Focus on regional supply chains: FM

Sitharaman says volatile geopolitics creating uncertainty and 'high-cost' risks

- Rajeev Jayaswal

The risk of terrorism is threatening businesses and disrupting global supply chains, Union finance minister Nirmala Sitharaman on Friday, when she suggested regional supply chains be developed to ensure global food security particularly for poor and vulnerable countries-amid uncertain and volatile geopolitical situations.

"Another factor... which is obvious, and it is the big elephant in the room... is the impact of terrorism across the globe," she said at the Kautilya Economic Conclave 2023'Navigating a World on Fireorganised by the Institute of Economic Growth (IEG) and the finance ministry.

She said terror attacks-led by organised groups or individuals are frequent and repeated. This is likely a permanent situation creating uncertainty and "high-cost" risks, which ultimately impacts "business decision-making or investments", the finance minister said, prompting the think-tank to find practical solutions.

The finance minister said businesses are also weary of terrorism and they are no longer attracted by only favourable policies, or by the opening up of an economy.

She said risks that the business would have to factor into their decision-making is "very strongly got to be influenced by the impact of global terror".