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HVK Archives: Pan-Islamic forces funding militancy

Pan-Islamic forces funding militancy - The Indian Express

Ritu Sarin ()
28 September 1996

Title : Pan-Islamic forces funding militancy
Author : Ritu Sarin
Publication : The Indian Express
Date : September 28, 1996

The Assembly elections may have revived the long-lost
hopes of normalcy in the Kashmir Valley, but whatever the
nature of the political process in the State, marginalis-
ing militancy will be no easy task.

For, according to a secret Government report, militants
in the State have developed what is by now a well-en-
trenched nexus with foreign sources for financial and
ideological support.

Indeed, foreign funding, it is claimed, is the prime
mover of secessionist and terrorist violence in the
Valley, in Punjab, and the North-East. According to a
report compiled by the Joint Intelligence Committee (JIC)
last year, Pakistan's Inter Services Intelligence (ISI)
spends about Rs 2.4 crore per month to sponsor its sub-
versive activities in Jammu and Kashmir.

The report, which for the first time, identifies both
sources and recipients of such funding, includes data
supplied by the Intelligence Bureau (IB), the Research
and Analysis Wing (RAW) and the Directorate of Revenue
Intelligence (DRI).

The JIC has identified Pakistan, Syria, Iran and Libya as
countries selectively supporting militancy for regional
gains. And Saudi Arabia, Kuwait, the United Arab Emi-
rates (UAE), Bahrain and Bangladesh as countries backing
pan-Islamic activities.

Linking the insurgency in Punjab and Jammu & Kashmir
(J&K) to drug money being generated in Pakistan, the
report claims that there is sufficient evidence pointing
to the "definite involvement" of the ISI and the Pakista-
ni Army.

The drug mafia in Pakistan used local couriers from
Pakistan Occupied Kashmir (PoK) to run a Rs 5,000-crore
traffic in narcotics through India.

Among the source material used by the JIC is a dossier of
the American Central Intelligence Agency (CIA), which
corroborates the fact that drug money was being used by
Pakistan to finance not only the Afghanistan war, but
also the proxy war against India in Punjab and Kashmir.

The CIA accused Sohail Zia Butt, the brother-in-law of
former Pakistan Prime Minister, Nawaz Sharief, among
others, for using "heroin money" for partially financing
Kashmiri terrorists.

According to the JIC, the funds move via clandestine, as
well as regular channels. For instance, in 1992-93, Rs
1,584 crore was transferred through the Foreign Contribu-
tions Regulations Act (FCRA).

Of this, intelligence agencies believe, a "substantial"
amount was given to militant and fundamentalist organisa-
tions.

There is also a "sinister" link, the JIC claims, between

contributions received for religious activity and their
use in terrorism. The report cites the example of Punjab,
which witnessed the maximum FCRA inflows between 1989 and
1992, at the height of its insurgency.

Hawala and the Foreign Exchange Regulation Act (FERA) are
the other channels for foreign funding.

The JIC report admits that a majority of FERA violations
go undetected, and since hawala operators worked on a
principal of anonymity, it was impossible to detect the
quantum of transactions being done through such channels.

The Government of the PoK is also said to be playing a
key role. The JIC claims that counterfeit currency was
being printed freely in PoK for distribution in the
Valley (as well as in Bangladesh for the North-East).
According to an Intelligence report, counterfeit currency
worth Rs 10 lakh was being printed every week at the
Abbasi camp located in the PoK for delivery to J & K.

Huge zakat collections (meant for welfare activities) in
mosques and other places of worship located on foreign
shores were also being siphoned into J & K. The PoK
Government, the report says, routinely funneled its zakat
collections to militants in J & K through the ISI.

Similarly, the Kashmir Liberation Cell headed by Retired
Air Vice Marshal Ayaz Ahmed Khan, set up by the PoK
Government also used the zakat route for its clandestine
funding.

Then there are the expatriate Kashmiri organisations,
such as the US-based Kashmiri American Council (KAC) and
the UK-based World Kashmir Freedom

Movement (WKFM), which work in tandem with the ISI and
play a major role in the diversion of funds to militants
in the Valley.

Along with this, an estimated $ 1 million (Rs 3.5 crore)
is said to be entering J & K every year under the aegis
of the

Organisation of Islamic Countries (OIC). For instance,
the Islamic Development Bank (IDB) gave a grant of US $
8,00,000, while another $ 30,000 was earmarked for Kash-
miri fundamentalist groups by the Islamic Solidarity
Fund.

Another Rs 13.5 crore is said to have been diverted to
the Valley by the Jamaat-e-Islami in 1990-91.

Taking a serious view of these, the JIC recommends an
audit of funds coming through legal and illegal channels
and an access to the country's banking system. On a
long-term basis, laws like the 'Banking Secrecy Act'
introduced by the United States (US) in 1970 could be
introduced.

The Act could make it mandatory for all banks to report
transactions, of, say, over Rs 1 lakh rupees to the
Government.

Another US law that could be incorporated in the Indian
system is the Money Laundering Suppression Act, so that

the law enforcement agencies get more teeth to deal with
the menace of illegal laundering of funds generated
through drug trafficking.

At the diplomatic level, the JIC suggests India should
enter into more extradition and mutual interest agree-
ments on security matters. as it recently did with the
United Kingdom (UK) and Canada.

This first-ever scrutiny of foreign funding should be
followed up with periodical reviews, and an investigation
conducted at the micro level by the various intelligence
agencies.

Militant violence may be a thing of the past in Punjab
but extremist groups continue to nurture their links with
foreign sources for financial support. This is claimed in
the confidential report of the Joint Intelligence Commit-
tee prepared last year. The report lists six such funda-
mentalist and 17 extremist groups, many of whom operate
from India as well as USA, UK, Canada, Malaysia and
Hongkong.

Apart from diversion of 'golak' collections from gurud-
waras whose control had been seized by Sikh extremist
organisations, the JIC claims that large sums continue to
be collected by extremist and expatriate leaders during
their visits abroad or through direct appeals made at
congregations and annual conventions held in these coun-
tries.

While tile JIC that it is not possible to precisely
quantify the extent of foreign funding, it estimates that
Rs 600 crore had come in from Pakistan and other coun-
tries into Punjab between 1981 and 1991.

Legal channels like the Foreign Contribution Regulation
Act (FCRA) were reportedly being used for the inflow of
funds. In fact. Punjab topped the list of states re-
ceiving contributions between 1989 and 1992. This A,as,
incidentally, the period in which terrorism was at its
peak.

Some important cases of funding mentioned in the JIC
report are the International Sikh Youth Federation (ISYF)
has been routinely sending money through hawala channels
to various Sikh fundamentalist groups. Details are
available of payments made to the Panthic Committee of Dr
Sohan Singh and Lakhbur Singh Brar and Baba Thakur Singh
of the Damdami Taksal, totalling Rs 20 lakh. In May
1992, the UK-based Council of Khalistan held Sikh conven-
tion and gave 86,500 pounds (Rs 47 lakh) to the Second
Panthic Committee. The following year, the Babbar Khalsa
office in France sent Rs 10 lakh to Punjab. The Germany
branch sent DM 30,000 (Rs 7 lakh) to the strife-torn
state. The most recent cases recorded have been of
Babbar Khalsa, Germany, sending Rs 2.7 crore through one
Manjit Singh Bagi to various groups as late as 1995.

These transactions have been linked to disclosures made
by a militant, Gurwinder Singh, who was apprehended along
with a consignment of 24 kg of heroin. This, according
to the report, suggests that the inflow of money and
drugs into Punjab is very much on. Moreover, an ISI
agent settled in USA, John Singh, is reported to have
corroborated the business of drug money being used to
finance hardcore Sikh extremists settled in Pakistan.

These instances, the JIC says, aren't exhaustive, only
illustrative. But what is significant is that while
large-scale funding of the Khalistan movement has been
going on since the early '80s, the flow of funds contin-
ues unabated. It is only the quantum that may have come
down.

Another trend noticed by the JIC is that of Punjab mili-
tants amassing property and wealth suggesting that a
portion of the funds given to extremist leaders, by their
patrons abroad, was hem. used for personal aggrandize-
ment. A case in point is the recovery of Rs 60 lakh from
the house of Navneet Singh Quadian, a militant of the
Khalistan Liberation Force, who had kidnapped Rajinder
Mirdha in Jaipur.

Funds were also being generated by some Christian and
other religious organisations and diverted for subversive
activities. Foreign aid coming to Christian organisations
have reportedly shown a steep increase in the past few
years. In fact, more than half of the 9,000 associations
receiving foreign contributions, under the FCRA were
linked to the church.

Besides money, ethnic groups in the north-eastern states
have been getting support from abroad by way of arms and
drugs.

Listing the major groups in each of the states, the
report states that a new dimension of "narco-terrorism"
had been added to the existing problem of insurgency
along the India-Myanmar border.

The United Liberation Front of Assam (ULFA) is said to
have kept Rs 200 crore in banks in Bangladesh and invest-
ed another sum of Rs 10 lakh in an unspecified project.

The ISI's network, the JIC report says, works in Bangla-
desh in collusion with groups like the Directorate Gener-
al of Field Intelligence and the Jamaat-e-Islami.

As for the funding of Hindu fundamentalist organisations,
the JIC report says that before the demolition of the
Babri Masjid in December 1992, Vishwa Hindu Parishad
units stationed abroad were said to have provided funds
to sustain the Ayodhya movement. But this could not be
confirmed. The JIC says that since this movement was not
a "secessionist" one, the collections had little security
implications.



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