SHREYA KEDIA
Though it is still early to come up with an estimate regarding the amount of black money unearthed due to demonetisation, what is clear as of now is that the Government’s masterstroke decision to demonetise high-value currency has achieved twin targets. As per an assessment by Central intelligence agencies, demonetisation has led to the closure of two printing presses in Pakistan which were involved in rioting fake indian currencies. This has in-turn stopped terror financing, with the result that there has been a 60 per cent decline in terrorism-related violence in Jammu & Kashmir. Consequently, there has been a drop in hawala transactions as demonetisation has dried up the funds for terror organisations across the border.
Counterfeiting of notes is not new. In fact, traditionally, it has been a massive lucrative business. What is new is that form being practised by individuals and various groups to earn profits, it is now being used as a state sponsor of terrorism. In India, counterfeiting of notes, fuelled by terror outfits, especially in Pakistan, separatists in Jammu & Kashmir, Left-wing extremism and also tax evaders within the country, have led to a gasping chasm between legal and illegal money.
This reached to a stage where circulation of fake currency had been a constant headache for our security agencies. Counterfeiting has rightly been termed as the world’s ‘second oldest profession’. The business ran so deep that as per National Crime Records Bureau data, more than 26 lakh fake currency of high-value denomination, with a face value of approx Rs 167 crore, were either recovered or seized by the Reserve Bank of India and law enforcement agencies in India from 2011 till 2015.
This proliferation into the Indian economy happened through various routes — some from within the boundaries and a major chunk of it from across the border. Of all, Pakistan had been a major contributor. The objective for which will not be too far to guess — to inflict maximum damage to the Indian economy and also to use the earned profit to fund covert activities. To achieve this, fake currency was scrupulously being used by terror outfits in Pakistan, underworld networks and also the Inter-Services Intelligence (ISI). There have been enough evidences that Pakistan had been running its printing press in Karachi, Lahore, Peshawar, and Quetta with direct support from the ISI. Money was being smuggled either directly or through multiple international routes, including Nepal and Bangladesh.
Terror financing followed many routes. Of the many, money was being transferred through the banking channel wherein, benefactors from across the border transferred money into the accounts of innocent middlemen in this country who had no terror linkages. The money was then withdrawn and handed over to Mujahideen cadres to fund their activities. Once money obtained, it was used by terrorists for buying arms and ammunitions, for operational activities and it also served as payments for the cadres.
The most common form of transfer opted by terror organisations such as the Hizbul Mujahideen and the Lashkar-e-Tayyeba is through hawala transactions which is also called the underground banking system. This form of transfer is, perhaps, the safest mode of transfer as there is no direct involvement of cash. Instead, hawaldars are hired to disburse money to different parts of the country.
On the other hand, there are authentic reports about the ISI’s direct involvement in this illicit business. David Headley, the 26/11 Mumbai attack convict, had himself in his statement said that Major Iqbal, who was his ISI handler, gave him fake currency for circulation and use in India. In yet another revelation, Syed Abdul Karim, who was a bomb maker for the Lashkar-e-Tayyeeba, and was also accused of masterminding over several bombings in India, confessed that he had received several consignments of fake currency arranged by an ISI Brigadier. He also revealed the key names of people involved in this business.
Side-by-side, demonetisation had also left the bank accounts of separatists groups like the Hurriyat Conference high and dry. It is a known fact that separatists had been working hand in gloves with the militants to wage a proxy war against India. The main objective was to keep the valley on the boil and also to thrawft any attempt of the Government to restore peace and normalcy in the valley. The most preferred route for the separatists too was ‘hawala’ money. Money was being transferred through a well-oiled machinery and hidden channels in the Kashmir valley. Money was pumped into the pockets of street protesters and stone pelters who would be at the forefront to organise protests against India and raise the banner of revolt.
The reason for this major crackdown is the added security features and highly specialised technology of the new currency, the duplication of which is next to impossible. The central agency report has also come as a tight slap on the face of all those people, especially the Opposition, who had questioned the efficacy of demonetisation. Now, all efforts must be made to sustain this concentrated effort and nip the problem in the bud.
(The writer is a practising journalist)