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India's IT firms step up security with paramilitary
Sun Sep 20, 2009 11:44pm EDT
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By Rina Chandran
MUMBAI (Reuters) - When Infosys Technologies, India's second-largest IT firm, hired paramilitary troops to protect its sprawling headquarters in Bangalore, some observers might have thought they had gone overboard.
But since the Mumbai attacks last year, India's software exporters have bolstered security due to concerns that militants might target their headquarters as symbols of the country's economic success and to deter foreign investors.
Foremost among those seeking to hire well-armed paramilitary troops are companies in India's Silicon Valley, Bangalore, the nerve center of the nation's $60 billion outsourcing industry that runs services from software coding to managing computer networks and call centers.
"India's IT firms are the flag-bearers of the country's thriving knowledge economy. This makes them 'high economic-value' targets with a global identity," said Manoj Vohra, director of research at the Economist Intelligence Unit's India division.
"Any assault on them will not only hurt India's commercial interests, but will also make the message travel faster globally."
Nasdaq-listed Infosys Technologies last month became the first private-sector firm to get the elite Central Industrial Security Force (CISF), a government trained paramilitary force, to guard its swanky Bangalore premises, which has about 20,000 staff. More than 80 firms, including IT firm Wipro, are also potential candidates for CISF protection.
The Mumbai attacks prompted the government to expand the services of the CISF, trained to protect such critical infrastructure as airports and power plants, to private sector firms in order to calm nervous investors.
The move signaled a shift in the role of government agencies in securing the private sector which has been a major engine of growth for India. The services sector, to which IT is a major contributor, makes up 57 percent of India's GDP.
"Clearly, even a minor incident at these firms can have an impact on their business and, therefore, the Indian economy," said Apurva Shah, head of research at brokerage Prabhudas Lilladher.
"If clients are nervous about visiting the Infosys campus because of security concerns, that is sure to have wider implications for the entire country," he said.
REASSURING FOREIGN INVESTORS
India is no stranger to security threats, including from Maoists, who have targeted factories and mines and have kidnapped businessmen in the past, as well as Islamists, such as the Pakistani-trained gunmen behind the Mumbai attacks.
The Mumbai police, armed with World War Two era rifles, were caught flat-footed by the gunmen who came armed with automatic weapons and high-tech communications equipment and targeted hotels popular with foreigners in India's financial capital.
So it's probably no surprise that firms have little confidence in entrusting their security to the local police, who are seen as ill-equipped, poorly trained and corrupt.
The CISF has 112,000 personnel manning nearly 300 public spaces, and will recruit about 10,000 every year, CISF spokesman Rohit Katiyar said. Continued...
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