Indian Companies Face Higher Risk of Disruption Than Any Other Asian Economy

Civil unrest is significantly more disruptive to business in India than in any other Asian economy, reveals a new global index released by risk consultancy Verisk Maplecroft, which ranks the country 4th and categorized as “extreme risk” alongside Asian markets, such as Bangladesh (6th) and Myanmar (8th). 

According to Maplecroft, it is striking that Brazil, France, India, Mexico and South Africa, which have all witnessed substantial disorder in the last year, lack adequate structures to avoid grievances escalating into wholesale protests. While France has an active civil society and trade unions, these tend to encourage demonstrations.

In contrast, Germany (ranked equal 140th with the UK and ‘low risk’) has a more consensual political culture that supports close cooperation between trade unions, industry and government, so protest is less likely to be an option of first resort in labour disputes.

In 2016 so far in the western world, France has experienced significant protests on a weekly basis, in comparison to Germany and the UK, where unrest that markedly disrupts business occurs on average every 6 months. 

“As we’ve seen in South Africa and Nigeria, poor economic performance is also a critical bellwether for the likelihood of civil unrest,” says Principal Political Risk Analyst Charlotte Ingham. “In addition, widespread political and ethnic discrimination or corruption can inflame popular discontent and trigger significant events.”

In 2016, corruption has been the catalyst for the biggest protests seen so far. Brazil’s Lava Jato bribery probe brought the public out into the streets in their millions, causing major disruption to business in the country’s commercial centres.

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