Addressing a meeting of chief ministers on internal security, he said thanks to radicalisation, many Indian groups have acquired the capacity to carry out terror attacks and there was no let-up in the attempts to strike terror wherever there was an opportunity.
He also said the state governments are at the front-line to defend internal security.
Chidambaram said an overview would lead to the conclusion that violence had declined in 2011 but cautioned that behind these figures lay a more worrying narrative -- which is the spread and the reach of some adversaries and their success in augmenting their weaponry and their military capabilities.
"The target is the Indian state and naturally, every constituent of the Indian state, and, in his offensive the adversary does not recognise state borders. His organisation does not match states' territorial jurisdictions.
"And he makes no distinction between the central government and the state governments," he said.
Referring to the two major terror attacks in 2011 -- the serial blasts in Mumbai in July and the blast near the Delhi High Court in September, the Home Minister said the "chilling facts" were that the principal suspects in the two cases were "Indian nationals".
They operated across states and many of them had no previous criminal record, the Home Minister said.
"I have to conclude, regretfully, that thanks to radicalisation, there are many Indian groups which have acquired the capacity to carry out terror attacks," he said.
Chidambaram said, "The international border and the Line of Control in the west continue to remain vulnerable. Every week has witnessed attempts to infiltrate into India and new routes appear to have been opened via Nepal and Bangladesh."
However, during his 20-minute speech, the home minister did not touch upon on the proposed National Counter Terror Centre, opposed by several non-Congress chief ministers, apparently due to the scheduled May 5 meeting which will deliberate on the controversial issue threadbare.
Describing the left-wing extremism as the "most formidable threat" to the internal security, Chidambaram said the decline in the overall number of casualties among civilians and security forces in LWE-affected districts may give a false sense of assurance, but that is not the true picture.
"The challenge of LWE has been compounded by the capacity of the CPI-Maoist to promote a number of front organisations and win the support of civil society groups. They use every instrument that is available in a democracy -- from freedom of speech to bandhs to judicial remedies," he said.
Chidambaram said several urban areas have emerged as new centres of pro-Maoist activities and there was a necessity to find ways and means to blunt the propaganda offensive launched by the CPI-Maoist.
"Two states are very badly affected, four states are affected and three states are within the arc of influence of the CPI-Maoist. Assam has emerged as the new theatre of Maoist activity. There are also inputs about links of CPI-Maoist with insurgent groups in Manipur and Arunachal Pradesh," he said.
Referring to the communal situation in the country, the home minister said though the situation was peaceful and the graph of incidents is declining, yet 91 lives were lost in 2011 and 1908 persons were injured in local communal conflicts.
"The so-called cause was usually trivial, but there were also cases of deliberate provocation. I urge state governments to remain vigilant, impartial and firm," he said.
Chidambaram said the success stories of 2011 were the dramatic improvement in the internal security situation in Jammu and Kashmir and in the north eastern states.
"Two factors seem to have turned the situation around -- first, the effectiveness of the security forces and, secondly, our ability to reach out to the adversaries and convince them that the Indian political system allows space for every shade of opinion and has the capacity to resolve differences through talks and other constitutional means," he said.
The home minister said in Jammu and Kashmir, there was a peaceful and splendid summer and winter and record numbers of tourists and pilgrims were there.
In the north eastern states, nearly all major groups are in talks with the government and exuded confidence that 2012 would see further advancement in bringing peace and development to these states, he said.
Chidambaram said in recent months, the security forces have made bold forays into hitherto forbidden territories such as Saranda Forest and Koel-Sankh in Jharkhand and Abuj-maad in Chhattisgarh.
However, the results remain sub-optimal, especially in areas under the control of area or zonal committees operating in Bihar-Jharkand-North Chhattisgarh, Andhra-Odisha and Dandakaranya, he said, adding that jan adalats and military training camps continue to be held with impunity.
"Economic infrastructure and so-called police informers continue to be targeted. Extortion is rampant. We have held frequent meetings with the DGPs and senior police officers of the affected states. I find that there is broad agreement on the two-pronged strategy of police action and developmental work, but, I am afraid, our capacity to execute the plans is not commensurate with the nature of the challenge," he said.
The home minister said the Integrated Action Plan launched in November, 2010, with an outlay of Rs 3,300 crore over two years, has been an outstanding success, thanks to the drive and determination shown by the district administrations.
"Still, we do not have the upper hand because there are not enough police stations; not enough men, weapons and vehicles; not enough infrastructure for the central armed police forces; not enough roads; and not enough presence of the civil administration -- especially in the health and education sectors," he said.
The home minister said more work need to be done in the front and pledged the cooperation of the central government in helping the states to overcome the challenge of LWE.
Chidambaram also referred to the unfinished tasks and sought the chief ministers' cooperation in utilising the funds that are made available and completing the projects.
"The Modernisation of Police Force (MPF) scheme was allotted Rs 1,111 crore in 2011-12, but we had to surrender Rs 311 crore because some states had large unspent balances. For the current year, we have been able to secure Rs 900 crore and I would urge state governments to address the deficiencies in the implementation of the scheme to help me request the Finance Minister for more funds," he said.
The home minister said in 2011-12, under Security Related Expenditure (SRE) and Security Infrastructure Scheme (SIS), the central government released Rs 883.51 crore and Rs 185.82 crore, respectively.
Release of funds and implementation can be more effective if proposals are submitted at the beginning of the financial year and greater financial and administrative powers are delegated to the director general of police in the state, he said.
"I have a vision of the overall security architecture that the country needs and deserves. Some elements are in place, for example, the Multi Agency Centre (MAC) and the Subsidiary MACs at the state capitals.
"NATGRID (for acquiring individual information) is work in progress. CCTNS (for tracking criminals), under implementation since 2010, has reached the crucial milestone of selection of system integrator, but only 16 out of 35 states/UTs have completed the task," he said.
Chidambaram said the development of Core Application Software (CAS) has been completed, field testing is under way, and agreements have been signed to establish nation-wide connectivity.
"The sum of all these, I am afraid, is that while CCTNS is progressing, it is 9 months behind schedule....Other elements have to be put in place to complete the security architecture and I earnestly seek your cooperation and support in that regard," he said.
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