Private security biz booms, requests for police cover go up

The Rs 40,000-crore private security business is witnessing a boom over increased threat perceptions from extortionists, terrorists and environmental activists.

The attack on Aurobindo Pharma Vice-Chairman K Reddy in Hyderabad could have been avoided if he had proper security, backed by the local police, say experts.

While most business houses have arranged for their own security, Reliance Industries Chairman Mukesh Ambani has cover from the Central Reserve Police Force (CRPF), which costs him about Rs 15 lakh a month.

Ambani and his immediate family members and the company's senior executives also have own private security teams which follow them when they go out in the city.
 

Ambani was provided round-the-clock protection by 28 CRPF commandos last April, following a threatening letter from terrorist outfits. Security for the Ruia-owned Essar Group headquarters and the Aditya Birla Group's headquarters in central Mumbai was recently increased after Greenpeace activists climbed Essar's headquarters to protest against damage to the Mahan forests in Madhya Pradesh by the group's power plant.

One of the biggest clients for private security is the cash logistics business, which deals with the movement and storage of currency notes and other valuables on behalf of banks. This business employs about 40,000 people and caters to approximately 80,000 automated teller machines for cash replenishment services.

Around 6,000 vans across the country carry Rs 15,000 crore of cash every day.

This business also holds Rs 4,000 crore of cash overnight in vaults on behalf of banks. Seven private companies account for 95 per cent share of the cash logistics business, says a Ficci study.

After the terrorist attacks in Mumbai in 2008, most business installations, including five-star hotels, have increased their security but experts say the cover is still not enough to prevent an attack.

Police officials say the real estate sector and the movie industry is prone to extortion from the underworld.

A police official said almost all top businessmen in Mumbai, builders and Bollywood celebrities had applied for police protection.