Union Finance Minister Nirmala Sitharaman on Friday (October 20) said terrorism is a big hurdle for businesses and suggested they factor in its impact on their operations and strategies.
In her address on day 1 of the three-day Kautilya Economic Conclave 2023, Sitharaman acknowledged that terrorism now has become a "permanent uncertainty" with a high-cost risk associated with it and economic policies alone are insufficient to address it.
Speaking during the Plenary session, the Union Finance Minister said, “The impact of terrorism across the globe is no longer an occasional one and no one region is spared. With that level of risk or uncertainty coming into business decision-making, investments will face uncertainty and high risk permanently.”
"Businesses can no longer be just attracted by policies or by the openness of an economy. The risk that the investors and businesses will have to factor into their decision-making is going to be strongly influenced by the impact of global terror," she added.
In recent years, the world has witnessed several lone wolf attacks engineered by isolated groups of people or sometimes, even a single person in some cases, making it difficult for governments to track them. The offenders often work just out of their ideological commitments.
The finance minister also highlighted the conflicts in Europe, Africa and now West Asia having diverse impacts on global supply chains that are resulting in price hikes of several commodities. "We are witnessing three wars all happening simultaneously where supply chains are very severely impacted."
Gazan militant outfit Hamas' invasion of Israel on October 7 and Tel Aviv's retaliatory aerial bombing and siege on the conclave have added to current instability, with some experts even suggesting oil prices could touch the $100/barrel mark.
India's Minister for Petroleum and Natural Gas, Hardeep Singh Puri, was quick enough to suggest that India will be able to manage oil prices above $100 per barrel, but it could lead to "organised chaos".
Sitharaman later pointed out that the government is conscious of macroeconomic stability and fiscal management in its decision-making. RBI Governor Das, who also spoke at the event, said the country's economic fundamentals and robust financial system provide India a cushion in light of the global challenges. Das also emphasised that central banks have a larger responsibility to maintain financial stability.
First Published: Oct 20, 2023 4:56 PM IST
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