This policy paper is related to one of the country’s major internal security concern group, which are “Naxals”, this paper will take the economic perspective of Growing Special Government Forces growing influence with growing electrification in the state of Chhattisgarh and the impact on Naxal Activities. Naxals are the group of people which believes on Monist-Socialism, which has an adverse relationship with growing democratic economy. This paper will show justification data to prove the positive relationship of between growing impacts of Special Government Force, Development & Electrification on the Naxals activities in the State of Chhattisgarh. Electrification & Development is in the context to “Rural electrification & development” which is the process of bringing electrical power & development (in terms level of Road Connectivity, Railway Connectivity, Unemployment ratio, Literacy Ratio) to rural and remote areas of the state or district. Rural communities are suffering from colossal market failures as the national grids fall short of their demand for electricity, development.

1. 1
Microeconomics
Imperfect Markets, Game Theory and Political Economy
(EPP502)
Economic Policy Paper on:-
Does Growing Influence of Special Government Forces
contribution to the Development in the state of Chhattisgarh,
which result to impact on Naxal Violence?
Submitted to: -
Prof. Pallavi Vyas
Submitted by: -
Keval Modi
(4th
Year IMBA; 143)

2. 2
Table of Content
Introduction...........................................................................................................................................3
Literature...............................................................................................................................................4
My Contribution .................................................................................................................................13
Economics............................................................................................................................................14
1. Parallel Economics & Shift in Supply Curve towards Right ...................................................14
2. Deterrence theory .....................................................................................................................15
Next Step..............................................................................................................................................16

3. 3
Introduction
This policy paper is related to one of the country’s major internal security concern group,
which are “Naxals”, this paper will take the economic perspective of Growing Special
Government Forces growing influence with growing electrification in the state of
Chhattisgarh and the impact on Naxal Activities. Naxals are the group of people which
believes on Monist-Socialism, which has an adverse relationship with growing democratic
economy. This paper will show justification data to prove the positive relationship of between
growing impacts of Special Government Force, Development & Electrification on the Naxals
activities in the State of Chhattisgarh.
Electrification & Development is in the context to “Rural electrification & development”
which is the process of bringing electrical power & development (in terms level of Road
Connectivity, Railway Connectivity, Unemployment ratio, Literacy Ratio) to rural and
remote areas of the state or district. Rural communities are suffering from colossal market
failures as the national grids fall short of their demand for electricity, development.
Research Question –
“Does Growing Influence of Special Government Forces contribution to the Development in the
state of Chhattisgarh, which result to impact on Naxal Violence?”
This policy paper will be focusing on the level of sensitivity between the growing Influence
of Special Government Forces & the growth of Development; and which in favour impacts to
Naxal violation in the state of Chhattisgarh.
Motivation –
As we know, India is a Republic & Democratic Country, and everyone votes to elect one
candidate which they feel are the most suitable for the work. But there are some elements that
oppose by not favouring the publically elected official. And these people believe to their own
rules & thought process towards the government, then it should be considered as a serious
offence towards the Country, and same such issues are been observed in the states of east
India like Chhattisgarh, West-Bengal, Jharkhand, Madhya-Pradesh, Andhra-Pradesh, &
Orissa, here the local authority brainwash the minds of the poor population of these regions
against government
My motivation to write this paper is to create a link between the steps taken by government
till now against such gangs (by generating several rules & regulations and Polies), with the
development of those areas (in terms of growth in Electrification, Development by Road,
Railway constructions).

4. 4
Literature
1) Operation Green Hunt –
‘Operation Green Hunt’ is an on-going counterinsurgency operation run by the
Ministry of Home Affairs, meant to liberate various forested areas through the Red
Corridor from Maoist control. It involves the deployment of thousands of central
paramilitary troops and Cobra Commanders in conjunction with State Police in the
states of Chhattisgarh, Jharkhand, Bihar, Odisha, and Maharashtra. The operation
began in July 2009 in the Abujmadh forest in Chhattisgarh. At first, the operation was
not openly discussed by the Centre—‘Operation Green Hunt’ was named so by the
Chhattisgarh government after a 2009 offensive in that state, and the media adopted
the nickname. The Chhattisgarh operations reportedly resulted in hundreds of
casualties among suspected Maoists and civilians, breeding resentment against the
government. Operation Green Hunt resulted in a spike of retribution attacks. The
centre’s reluctance to claim and endorse these military operations is due in part to
their preference to be seen as combating the Maoist threat mostly through
development schemes, rather than military action, which inevitably result in civilian
casualties. Also, security sources have said that the opacity is designed to limit the
flow of information to Maoist leaders.
 This operation started in the F.Y 2009, in the month of June, July &
September.
 Their main target were, “Sangam” villages of Red Corridor region (Sangam in
Hindi, the gathering of something or some elements) which are established by
Naxalites in their Prone/Hegemonies area's and are been kept alienated from
rest of the world (in terms of economy & development).
 Under this operation 499 Sangam members arrested in 2009– up from 214 in
2007.
 Type of Forces Included for Operation- Salwa Judum, Special Security Force
(Guerrilla Force), CRPF, BSF (Border Security Force), Indo-Tibetan Border
Police (ITBP), Service Selection Board (SSB), State Police.
 Total number of personnel deployed by this force- 20, 000 (Of which 6,000
were State Police).
 Named the Arm Force- Cobra Force (A Joint Operation by above mentioned
Forces and State Police)
 Deployment Days- 3 Days in Dantewada.
 Deployment area in 40,000 square kilometre of Chhattisgarh.
 Result
Number of Naxals killed - [F.Y 2008- 66] => [F.Y 2009- 113]
Number of civilian death due Naxals - [F.Y 2008- 143] => [F.Y 2009- 116]
https://scholar.princeton.edu/sites/default/files/jns/files/svia_2017_india_state_coin_histo
ries.pdf
2) Special Infrastructure Scheme (SIS):
SIS was approved in the national Eleventh Five- Year Plan (2007-12), with an
allocation of Rs. 500 crore, to cater to critical infrastructure gaps, which cannot be
covered under the existing schemes. These relate to requirements of mobility for the
police and security forces by upgrading existing roads and tracks in inaccessible areas,
providing secure camping grounds and helipads at strategic locations in remote and
interior areas, measures to enhance security in respect of police stations outposts
located in vulnerable areas etc. Now, this scheme has been expanded to provide funds

5. 5
for up gradation of infrastructure, weaponry, equipment and training of Special Forces
for operations in LWE affected States.
https://scholar.princeton.edu/sites/default/files/jns/files/svia_2017_india_state_coin_histo
ries.pdf
3) Road Requirement Plan for LWE areas –
RRP’s Phase-I was approved in February 2009 for improvement of road connectivity
in 34 extremely LWE affected districts in eight LWE affected States of Andhra
Pradesh, Bihar, Chhattisgarh, Jharkhand, Madhya Pradesh, Maharashtra, Orissa and
Uttar Pradesh. The RRP-I envisages development of 1126 kms of National Highways
and 4351 kms of State Roads (total 5477 kms), at a cost of Rs. 7300 crore. A length of
2750 kms has been built at an expenditure of Rs 3479 crores till 31 December 2013.
https://scholar.princeton.edu/sites/default/files/jns/files/svia_2017_india_state_coin_histo
ries.pdf
4) “Indian State Counterinsurgency Policies: Brief Historical Summaries”
{Written By- Jacob N. Shapiro, Oliver Vanden Eynde, Katherine Ingram & Emefa
Addo Agawu}
This paper, has clearly described whole chapter of Naxalism in the Republic of India’s
state wise. In this literature my main focus of study was the influence of Naxals in the
state of Chhattisgarh. This literature has clearly mentioned the history of establishment
of Naxals in this state and consequences happened in state economy due to their
presence, like- Naxals established a presence in rural and tribal areas districts of
Surguja and Bastar in the early 1980s. These areas have some of the lowest rates of
education and health care access in India as well as few government facilities.
Additionally, villagers in scheduled areas allege that corporations and government
forces have threatened and intimidated them into giving up land for mining and
industrial purposes.
Basically, this policy paper has shown the emerging market of Chhattisgarh with the
consequences happening by this Naxals, like-
1) Having 30%-32% literacy rate during 1980’s
2) Positive sex-ratio
3) Poorest Ranking States in the Human Development Index
4) 38% of Steel Producer
5) 16% total mineral producer
6) In 2016, highest death-troll due to naxal influence
7) Lack of Government facilities (In influence areas like- Bastar & Dantewada)
8) Introduction of Local Self Governance (As per Schedule Areas Act, 1996). Made
local representatives & people, mass resentment against Government.
9) Establishment of Special Gorilla War Force i.e., “Greyhounds” by Andhra Pradesh
Government; resulted as a clearance of Naxals in the state and decreased their size to
0.1%.
10) April-2013, Government of India initiated to apply such war force in pan India
(especially, Naxal effected regions).
11) Policy for “Voluntarily get Surrendered”, this initiative had started during Naxal
were at weakest point and the Government of India has started this scheme. Under
which many of the group leader got voluntarily surrendered.

6. 6
https://scholar.princeton.edu/sites/default/files/jns/files/svia_2017_india_state_coin_h
istories.pdf
5) Physical Power/Electricity Producing Infrastructure –
Below data represent the opportunity (in terms of Economics of Scales) that State of
Chhattisgarh has utilized through its natural resources. By establishing new power
plants off different technology (i.e. Thermal Based, Hydro Based, Nuclear Based &
Renewable based), and there has been increase of 7% electricity capacity per year
from FY17 to FY18. And majority of electricity is produced from thermal energy i.e.
94%. And also the state has surplus electricity in reserves. So, they exports it other
states.
Below data shows, the Physical Road Infrastructure in State of Chhattisgarh, where it seem to
be that in the FY-> 2017-18 the government has completed 1019.57 km. compared to
previous years 1020 km. of the districts are been covered-up by the Government under the
scheme of “Pradhan Mantri Gram Saḍak Yōjanā”. This seems to be great development
growth in the state.
https://www.ibef.org/states/chhattisgarh-presentation

7. 7
6) Physical Infrastructure in Roads Development-
Below figure shows the biggest initiative taken by government for the development of rural
area (especially which influenced by Naxals), by building road. This made a huge
contribution like a helping hand for enforcing infrastructure & easy connectivity at those
areas. These also lead to dropping down the grey activities due to increasing presence of
government forces at those areas. It also reduce the travelling time, which lead to the great
contribution to GDP of the state.
https://www.ibef.org/states/chhattisgarh-presentation

8. 8
7) Physical Infrastructure in Roads Development-
Below data shows the emerging railway connectivity in the State of Chhattisgarh, were the northern
railway connectivity were rich in nature, but after 2009 Government initiative. There has been drastic
growth in rail connectivity among as state’s areas and with other cities of the country (Like-
Ahmedabad, Prayagraj, Bengaluru, etc. It has also increased the economics of scales for mining
industries of the mineral-rich state.
https://www.ibef.org/states/chhattisgarh-presentation
8) Document by Road Transportation and Highway Departments -
This document which has been submitted by the Ministry of Road Transportation & Highways, it
literally shows that, there has been growth year on year in terms of Budget Allocation & new road
tender passing.
It shows that there has growth of 13% & 19%, in road transportation. So, government initiative is
clearly been quantified by this data.
https://www.indiabudget.gov.in/ub2019-20/eb/sbe81.pdf

9. 9
9) Employment Data (By World Bank) –
If we look the above figures in the table (for the F.Y 2012), it clearly shows that the, from all genders
only 13% & 14% are employed in Industry & Service sectors respectively of participative populations
rate other than agriculture (which is seasonal employment) i.e. 82%. And from that 10% are salaried,
36% are casual wages based population. This seems to be having a gap of a large chunk of population
which are unemployment in Government directory. From which many can be genuine, disguised &
many could be employed by these informal sectors also (Like- Naxals).
The above graph clearly shows that state of Chhattisgarh is at top in terms of Poverty Rate in
the pan India. Basically, poverty rate is the ratio of the number of people (in a given age
group) whose income falls below the poverty line. This can be one of the main reason that
people tend towards the parallel economy based employment (Like- Naxals hiring children’s

10. 10
of localities) for generating revenue for their households. And if look at the map, the darkest
area is the Naxal prone region (like- Bastar & Dantewada districts).
http://www.worldbank.org/en/country/india/brief/india-states-briefs---chhattisgarh
10) Literacy Rate (As per Census- 2011) –
This that there was an increase in 2.89% & 8.39% of literacy rate in Male & Female
respectively. And in F.Y 2011 there was 42% (approx.) female were literate & 58%
(approx.) man were literate compared to 40% & 60% in the F.Y 2001 for Female &
Man population respectively. So, there has been an increase in the literacy rate @
37.65% (approx.). Which is a good indicator for a developing nation & country for
better racial growth?
https://www.census2011.co.in/census/state/chhattisgarh.html
11) Crime Statistics of Dantewada -
-

11. 11
My Analysis- Above diagram clearly shows that there has been a decrease in “Dacoity” in the
district of Dantewada (One of Most Influence District of Chhattisgarh by Naxals) compared
to a well-developed & established the capital of Chhattisgarh i.e. Raipur. It clearly shows that
step was taken by Government after the F.Y 2009, the level of “Dacoity” has decreased at a
drastic level, even Dantewada has lower dacoity then Raipur, i.e. 1/year and 4/year
respectively.
http://www.neighbourhoodinfo.co.in/crime/Chhattisgarh/Dantewada

12. 12
12) Naxal Affected Area Comparison 2007; 2013 &; 2016 -
Figure 1. During 2007 Figure 1. During F.Y 2013
Figure 2. During F.Y 2016
The above maps shows influence area under naxals. It clearly been seen that year by year the
influence areas by naxals are decreasing drastically (Majorly after 2009 Government initiate
for cleaning Naxals).
https://en.wikipedia.org/wiki/Naxalite%E2%80%93Maoist_insurgency#/media/File:India_ma
p_Naxal_Left-wing_violence_or_activity_affected_districts_2013.SVG

13. 13
My Contribution
In this policy paper, I have tried to fill the gap of findings regarding the linkage of
growth rate of development and electrification with level of impacts on Naxal
violence’s. For this I had linked the state government GDP, employment ratio data,
literacy ratio data, road development data, railway development data, Naxal influence
area mapping year by year, electrification data, many government initiatives taken by
government like- Operation Green Hunt, Special Infrastructure Scheme & Road
Requirement Plan for LWE Areas, and Level of Dacoits based crime in the state
before and after. This relationship clearly showed the positive relationship between
Government Special Force growing influence and Development of Infrastructure &
Electrification, which impact on the Naxals Activities in quantified manner.

14. 14
Economics
1. Parallel Economics & Shift in Supply Curve towards Right –
This is a grey part of the economy which is based on the “black money or unaccounted
money, and it is a big menace to the Indian economy. It is also a cause of big loss in the tax-
revenues for the government. As such, it needs to be curbed. Its elimination will benefit the
economy in more than one way.”
We will have a look into the sensitivity of Naxals activities on the Economy of the
State (in terms of GDP). As, we know the uncertainty in the economy leads to a
reduction in the output rate compared to normal, and the same has been seen during
Naxals activities, by threatening the Corporate Peoples, Normal People,
Government/Armies, etc. which leads the result of “Shift in Supply Curve towards
the Right”, by having decrease in demand and increase in the price/quantity due to
shortage in supply (in that market). Example - There has been a great level of exertion
towards the corporate world by kidnapping industrialists and representatives of
BALCO, NALCO, Jindal Steel, etc., by the Naxals. This resulted in strikes in
Companies and Curfew’s, which indirectly would affect the GDP of the state and
nation as a whole. The graphical representation of such a state is shown at below
Graph-
As per a study done by scholars in their article, it represents that, the violence made
by Naxals accounts to 17.23% of State economies’ loss
https://pdfs.semanticscholar.org/e2b5/48ae4b9cd66a060c2d41b292409a789e4a4a.pdf

15. 15
2. Deterrence theory -
Deterrence is a theory from behavioural psychology about preventing or controlling
actions or behaviour through fear of punishment or retribution. This theory of
criminology is shaping the criminal justice system of the United States and various
other countries.
Operation- Green Hunt (F.Y: 2007-09), made a deterrence to Naxal forces them
physiologically, by showing them a huge number of well-equipped & armed forces &
made them into a dilemma between reviling their information by voluntarily or else
get jailed & killed by Special Arm force. So, here comes the existence of “Game
Theory”, by creating a dilemma between voluntarily surrender or not.
Naxal
Reveal
Not-
Reveal
Special
Force
Kill 3,0 1,2
Let Go 2,1 0,3
Here,
 If Special Force play the “Kill” decision, then Naxal would play “Not Reveal”
option. As 2>0.
 If Special Force play the “Let Go” decision, then Naxal would play “Not
Reveal” option. As 3>1.
 If Naxal play “Reveal” decision, then Special Force would play “Kill” option.
As 3>2.
 If Naxal play “Not-Reveal” decision, then Special Force would play “Let Go”
option. As 3>2.
So, the Nash-Equilibrium would be that Special Force decides to “Kill” &
Naxals “Not-Reveal” the information.

16. 16
Next Step
As, these people showcase that, they fight against the Government for forest protection, tribal
protection, culture protection & want to provide each furthermore everyone with a related
supply of basic requirement. For this, I would like to work on building-up framework a
policy which would solve this matter of connectivity, which has led to such dispute in such a
developing nation.