Indian Defence Review

Money is also raised by terrorist groups and their front organizations, as well as their political affiliates, in Pakistan, often directly to fund the jihad, but more comprehensively and routinely, towards the various religious charities these groups also run. Part of the money received for charitable works is skimmed off to fund terrorist infrastructure and operations. These organizations also receive substantial contributions from international Islamic charities and foreign sympathizers. Among the prominent charities, non-governmental agencies and political formations across the world that are believed to have funded various terrorist organizations are the World Assembly of Muslim Youth; the International Islamic Federation of Students’ Organisations; al Haramain foundation; the International Islamic Relief Organisation; the Global Relief Foundation; al Rabita Trust; al Rashid Trust; the World Kashmir Freedom Movement; the Consultative Committee of Indian Muslims; and, in Pakistan, the Jamaat-e-Islami, the Muslim Conference, the Jamiat-e-Ahl-e-Hadis and the People’s League, among others.

Terrorist fronts in Pakistan also raise some revenues from various investments in business ventures – including reportedly substantial transactions in the one-time booming Indian stock market. The narcotics trade, weapons’ smuggling and extortion are additional sources of revenue generation.

The principal sources of revenue generation for Islamist terrorists in India, consequently, lie outside the country, with a bulk of sources located in Pakistan, and protected by Pakistan state agencies, and its military in Pakistani-controlled areas in Afghanistan. The core challenge of tackling terrorist finance is, consequently, limited to the receipt and distribution of funds. The overwhelming proportion of such transfers occur through informal hawala channels, though forged accounts and some highly opaque transactions through the legal banking and wire transfer system also play an occasional part.”[v]

The fundamental basis of this money laundering network is the “hawala” system. In the most basic variant of the hawala system, money is transferred via a network of hawala brokers, or hawaladars. It is the transfer of money without actually moving it. In fact, a successful definition of the hawala system that is used is “money transfer without money movement.” Hawala or money laundering refers to the conversion of illegal and ill-gotten money into legal money so that it can be integrated into the legitimate economy. Money is also transferred through travellers from Pakistan to India, particularly on the bi-weekly Express Train that shuttles between Munabao in Barmer, Rajasthan, and Khokhrapar in Sindh, Pakistan, and the Samjhauta Express across the Attari border. There have also been occasional arrests of passengers carrying substantial sums for terrorists on the Srinagar-Muzzafarabad ‘Karvan-e-Aman’ bus. Proceeds of drug-related crimes are an important source of money laundering the world over.

One of the keys to its growth has been the Pakistan military presence in Afghanistan and the “Tribal Territories”. Pakistani military does what it wants in Afghanistan, just as it does in Pakistan. That is not a secret because about half of the time since Pakistan was created in 1947 the military has openly run the government until popular opposition forced the generals to allow elections again. Terrorism related deaths are overwhelmingly caused by the Islamic terrorists, mainly Taliban and Haqqani Network attacks. To maintain control of the Afghan Taliban the ISI calls on another of their “protected” Islamic terror groups; the Haqqani Network. This group was once a faction in the 1990s Afghan civil war but always had a good relationship with the ISI. Over the last two decades Haqqani have turned into a criminal gang that also manages terror operations in Afghanistan for ISI. On September 2, 2018: The United States told Pakistan that $300 million in military aid was suspended because continued refusal of Pakistan (specifically the military) to shut down Islamic terrorist operations inside Pakistan. The Pakistani military showed, in 2014, that it could do so against Islamic terror groups (Pakistani Taliban, ISIL) that threatened the Pakistani government. But Pakistan has refused to admit it protects Islamic terror groups, like the Afghan Taliban, Haqqani Network and several groups that carry out attacks in India.

However, on 19 December 2018 President Trump announced he was removing a substantial number of troops from Afghanistan. The US military will quickly pull nearly half of its forces from Afghanistan, and likely withdraw the rest by the end of 2019. This proclamation was an outright victory for the Taliban, al Quaeda and other jihadists and opens the door to Pakistan’s ISI domination of the criminal and terrorist links in both countries. This will have a dramatic effect on the Kashmir-Jammu battle between India and Pakistan. “Pakistan’s use of jihadism as a foreign policy tool has been validated. Pakistan also has much to gain from a US withdrawal. It says much about America’s ineptitude and confusion that not a single Pakistani official was ever sanctioned or designated as a terror supporter throughout 17+ years of war. Besides the Trump administration’s decision to withhold some military aid, Pakistani officials never paid a real price for harbouring the same forces that were attacking Americans and their allies.”[vi]

Pakistan’s model of using jihadists to further its foreign policy goals in the region has been validated. Pakistan sponsors the Taliban and other terrorist groups as part of its regional security strategy. But there is more to it than that. Some unknown number of Pakistani officials have themselves fallen under the jihadists’ sway. The Pakistani military and intelligence establishment will continue to export the jihad to neighbouring countries, particularly in the Indian state of Kashmir, but perhaps also elsewhere, using the financial might of organised crime to fund these programs.

In the past few years it has become more difficult for state-sponsors of terrorism to maintain direct links to terrorist organisations as the threat of sanctions and economic pressure from the West has expanded. This has led to increased terrorist dependence on organised crime for financial viability and organisational survival. Structurally, terrorist groups will increasingly mirror organised crime groups and utilise their access and control of market and the hawala system. While the bulk of the terrorist groups will retain their political content, the potential for a few terrorist groups to degenerate into pure criminal groups will, nevertheless, increase. The linkage between organised crime and its ability to thrive in a web of corruption among politicians and militaries and its access to the international market for illegal trades in people, drugs, raw materials, weapons of war and equipment make it an invaluable resource for their partners.

The Key Role of Dubai

The geographic and financial hub of the growing symbiosis of organised crime and terrorism has been the city-state of Dubai. This is especially true of the success of criminal groups like D Company being sheltered in Dubai and protected by its government.

“One of the largest and most unregulated financial centres in the world, with huge turnovers in undocumented movements of gemstones – including those originating in the world’s worst conflict areas – gold and cash, and located at the strategic crossroads of the Gulf, South Asia and Africa, Dubai has long been a financial hub for organised criminal and Islamist extremist groups, as well as a primary transit point for the shipping of contraband. The Dawood Ibrahim gang controls much of this contraband movement from and to South Asia, as well as, crucially, a large chunk of the illegal hawala transactions in the region. It is this latter element that constitutes the gravest threat within the context of contemporary international terrorism: hawala is the future of terrorist financing, as various systems of transfer through ‘regular’ banking and conventional money laundering channels all leave behind paper trails that are vulnerable to eventual discovery. A paperless transaction, the traditional South Asian hawala system leaves behind no evidence once the monies are delivered to the recipient…. The reality of this superficially modernised City State is that it runs a highly efficient operation that uses contemporary technologies and commercial systems that supports the world of disorder, lawlessness and terror, and Dubai is, indeed, a direct beneficiary of, and heavily dependent on, its linkages with this underworld.”[vii]

As was pointed out by Lord Robertson, Secretary General, NATO, April 17, 2002. “”How easy it was for Al-Qaida’s bankers to have five hundred thousand dollars wired from a bank in Dubai for anonymous use in automatic teller machines in Florida and Maine. How difficult it has been, even with the backing of United Nations resolutions and 150 nations, to find out who raised or sent those dollars… illegal money doesn’t just feed other security threats – it also causes them.”

Of particular interest in Dubai has been the important shelter it has offered to many figures in the international crime scene, especially D Company. Occasionally, under pressure, it has arrested several of its member, including those involved in the 1993 Mumbai bombings. However, they have often escaped prosecution and their extradition to India has not been honoured.

Some of Dawood’s D Company people were taken into custody in Dubai; that included twenty-six of the Dawood Ibrahim gang, including two of Dawood’s brothers – Noora (Noorul Haque) and Mustaqim. Both Noora and Mustaqim – along with Mohammed Dossa, another of the arrested gangsters – were accused in the 1993 Bombay Blasts. Both Noora and Mustaqim are permanent residents of Dubai, with substantial business interests in this City State. Indian authorities were unable to extradite them. They were later released for ‘lack of evidence’. Some were allowed to leave for Pakistan.

This set the scene for the liberation, once again, of the most important brother, Anees. The United Arab Emirates (UAE) authorities announced on December 8, 2002, the arrest of Anees Kaksar Ibrahim in Dubai (He was arrested on December 3, three days after his reported arrival from Pakistan). Anees was one of the fugitives on the list of 20 most wanted terrorists. Three days later Anees was released on bail and extradited to Pakistan. This is at least the third time this has happened: in January 1996, Anees was arrested in Bahrain, but was later shifted to Dubai, allegedly on the intervention of some of Dubai’s ruling notables and was then allowed to slip away to Pakistan. He was again arrested in 1998 on charges of having murdered a former associate and then rival, Irfan Goga, in Dubai, but was freed after two days for ‘lack of evidence’. Anees maintains a sprawling establishment, owns a number of other properties, operates a thriving combination of legitimate and illegitimate businesses, and where he visits regularly. Anees has been the operational head of D-Company, ever since Dawood has been depressed and visiting doctors in Karachi, Pakistan where he is ‘protected’ by Pakistani soldiers.

He is not alone in Dubai. “Indian Mafiosi, who substantially owe their success to operations based in Dubai at one time of their career or another, include Abu Salem currently in custody in Portugal on charges of travel documents fraud, but wanted by both the USA and India for involvement with terrorist activity; Aftab Bhatki, who controls the entire fake currency operations in India on behalf of Dawood Ibrahim, and who has an Interpol Red Corner notice against him on India’s request; Raju Anadkar, perhaps the largest money launderer in the region; Babloo Shrivastava, who controlled his kidnapping and extortion empire in India from Dubai, till he made the mistake of travelling to Singapore and was nabbed and extradited to India, where he currently bides his time in jail; Chhota Shakeel, another D-Company associate, who controls operations in Mumbai from Dubai; Chhota Rajan, a former Dawood man, now a bitter enemy, who the ‘Company’ tried to assassinate in Bangkok in November 2000; and, of course, Dawood Ibrahim himself, though he now finds residence in Karachi, under the ISI’s protection, safer than Dubai. A substantial volume of illegal trade to and from Russia also passes through Dubai, and the Russian mafia has now established a significant presence there. The US is also said to be ‘advising’ Dubai on how to prevent the ‘abuse’ of its facilities as a free trade zone by criminal and terrorist groups, and US investigators are currently looking into large volumes of clandestine (hawala) financial transactions by various terrorist fronts connected with the Al Qaeda, especially the movement of escalating volumes of gold in innumerable unaccountable transactions since the collapse of the Taliban regime in Afghanistan. Indeed, Dubai is a veritable Utopia as a secure base for criminal and for terrorist financial operations that target other countries.”[viii]

Although Dubai hosts a wide variety of gangsters from the subcontinent, they do not always get along with each other. This was particularly true in the battles, assassination attempts and mayhem between the forces of Dawood and Chhota Rajan after their split and the rise in communalism in the ranks of organised crim. The Dubai authorities have always said that the reason they didn’t extradite the various Indian gangsters but let them ‘escape’ to Pakistan or India was that they wanted to avoid a ‘turf war’ in Dubai’s streets. An additional factor was the struggle within D Company between Dawood’s right-hand man, Chhota Shakeel and Anees Ibrahim over who controlled D Company in Dubai. This conflict has come to a head with the death of Chhota Shakeel.