Naxal challenge

Though the severity of Tuesday’s Naxal attack on CRPF personnel took everyone by surprise, investors have been thinking about its impact on investment for quite a while. Citibank’s January 15 report on India has 10 trends for the decade, one of which is the impact of Naxal violence. While outlining where the violence has spread and how the Naxalites are tapping into popular discontent, the report quotes a Ministry of Rural Development statistic to say that while tribals comprise 9 per cent of the population, they account for 40 per cent of the land that has been acquired so far.

The response of the government, the report says, has been to come up with a special development package of Rs 20,000 crore for 33 Naxal-affected and 22 Naxal-infested districts. That is, apart from sending paramilitary forces. Whether this reassures investors is the question.