By Kunwar Vikram Singh, Chairman, Central Association of Private Security Industry (CAPSI)
India’s private security industry, which employs nearly one crore people, is facing a regulatory structure that needs urgent reconsideration. At a time when the government is promoting economic reforms, deregulation and Ease of Doing Business under the principle of Minimum Government, Maximum Governance, the industry continues to operate under the Private Security Agencies (Regulation) Act, 2005 (PSARA), which requires agencies to obtain licences from the police to conduct business.
The author argues that, after more than two decades, it is time to examine whether PSARA has genuinely improved professional standards or has instead created another layer of bureaucratic control.
Private Security Is a Commercial Service
Private security is essentially a privately financed commercial service. Residential societies, businesses, industries and individuals hire security agencies according to their requirements. Clients assess the competence of agencies, negotiate commercial terms and enter into service-level agreements. Agencies, in turn, recruit personnel, provide training and supervision, and deliver the contracted services.
The author questions why such a market-driven industry should require continuous government licensing and administrative intervention. A government licence does not automatically guarantee professional competence, adequate training, supervision or quality of service. Professional excellence, he argues, should emerge from education, experience, competition, ethical conduct and accountability rather than merely from the issuance of licences.
Private Security Should Not Be Confused with Internal Security
The article also challenges the perception that private security is an integral part of India’s internal security machinery. Maintaining law and order, investigating crimes, gathering intelligence and protecting national security are sovereign responsibilities of the State.
Private security agencies do not possess comparable statutory powers. Their primary responsibilities arise from commercial contracts with clients. Although security personnel can assist during emergencies, report suspicious activities and cooperate with law enforcement agencies, cooperation should not be confused with institutional subordination.
If the government wants private security agencies to play a formally recognised role in the national internal security framework, it must provide appropriate legal recognition, institutional representation, authority and clearly defined responsibilities. Otherwise, private security should be treated as a professional service industry operating under ordinary laws.
PSARA and the Problem of Inspector Raj
Under the existing PSARA framework, private security entrepreneurs must deal with licences, renewals, police verification, inspections and multiple administrative procedures.
Industry representatives have raised concerns about delays, inconsistent interpretations, excessive paperwork and arbitrary administrative action. The author argues that such discretionary powers can create opportunities for harassment and corruption, particularly where transparency and accountability are weak.
He also questions why police organisations, already burdened with crime prevention, investigations and public-order responsibilities, should administer the commercial affairs of private security agencies.
His position is straightforward: the police should concentrate on policing, professional institutions should establish industry standards, and clients should decide which agencies meet their requirements.
The article also calls for greater transparency regarding the licensing and renewal fees collected from the industry. There is insufficient publicly consolidated information about how these revenues contribute to professional training, research, entrepreneurship or the welfare of security personnel. A national assessment of licensing revenue, administrative expenditure and regulatory outcomes is therefore necessary.
Financial Pressures on the Industry
The private security industry largely finances its operations through payments from clients. Entrepreneurs invest in recruitment, training, salaries, supervision and administration without the routine budgetary support available to government security organisations.
Despite this, agencies face multiple regulatory obligations, including taxation, labour laws and separate licensing requirements.
Their financial difficulties are increasing because of delayed client payments, GST-related cash-flow problems, rising wage obligations, unrealistic tender conditions and extremely low service charges.
An agency may be legally required to pay its employees on time even when a client has withheld payments for several months. While protecting employees is essential, the author argues that legitimate employers also need protection against chronic payment defaults.
He calls upon the Ministries of Finance and Labour and Employment to recognise that a financially unsustainable industry cannot provide stable employment or reliable security services.
Ease of Doing Business, he says, must mean reducing unnecessary government intervention rather than simply digitising existing bureaucratic procedures.
The Alternative: Professional Self-Regulation
As an alternative to police-administered licensing, the author proposes creating an autonomous National Council for Private Security Services, supported by state-level professional councils.
Drawing comparisons with professional institutions such as the Bar Council of India and the Institute of Chartered Accountants of India, he argues that professional standards can be maintained through independent institutions rather than routine government control.
The proposed National Council should be established through appropriate legislation and governed primarily by elected representatives of the profession, with participation from security personnel, professional institutions and Central and State Governments.
Its responsibilities would include:
Professional registration of security agencies and practitioners.
Establishing competency and training standards.
Accreditation of training institutions.
Maintaining ethical standards and disciplinary mechanisms.
Quality certification and professional assessments.
Workforce development and career progression.
Government representatives would safeguard public interests and provide guidance without unnecessarily controlling routine professional activities.
However, essential public-safety responsibilities, including criminal antecedent verification, investigation of offences and weapons regulation, would continue under existing laws.
The author emphasises that self-regulation does not mean freedom from accountability. It means replacing unnecessary bureaucracy with professional responsibility.
Empowering Clients and Security Personnel
Under a professionally regulated system, clients should be able to assess agencies through recognised certifications, experience, independent quality ratings, trained personnel and measurable service standards.
Agencies would have greater incentives to invest in technology, training, supervision and ethical practices.
The article also highlights the importance of Recognition of Prior Learning, competency-based certification and continuous professional development to improve the career prospects of millions of security personnel.
At the same time, professional self-regulation must remain transparent and inclusive. It should not become a mechanism for established businesses to restrict competition or prevent new entrepreneurs from entering the industry.
The objective should be professional freedom combined with public responsibility.
Appeal to the Prime Minister
The author appeals to Prime Minister Narendra Modi to initiate a comprehensive review of PSARA, 2005, and examine whether the existing licensing framework is still necessary in its present form.
He proposes establishing a high-level committee involving the Ministries of Home Affairs, Law and Justice, Finance, and Labour and Employment, along with State Governments and representatives of the private security industry.
The committee should evaluate the costs and benefits of the current licensing system and recommend ways to eliminate unnecessary inspections, discretionary powers and repetitive compliance requirements.
The central argument is that an industry providing livelihoods to nearly one crore Indians should be encouraged to become more professional, competitive, innovative and financially sustainable.
The article concludes with a call for a fundamental shift in the regulatory philosophy governing India’s private security sector: Let the Government govern, let professionals regulate their profession, and let clients choose their security service providers.
The author believes that replacing excessive bureaucratic control with accountable professional self-governance would represent genuine regulatory reform and give practical meaning to the government’s promise of Minimum Government, Maximum Governance.
