Terror Financing in Pakistan

Syeda Zainab

Terrorism has evolved as a concept that has permeated almost every state’s layers as it manifest itself in a variety of ways, ranging from individual pursuits to well-planned publicized plans. Terrorist activities, according to the Council of Europe, can take various forms, and thus the means of financing such endeavors would vary accordingly. The phenomenon essentially involves the generation of resources to finance any terrorist activity. Terror financing is a serious concern in Pakistan, not only for its socio-economic and political stability, but in terms of its internal and external security as well. Retaining Pakistan in FATF grey list despite addressing 26 out of 27 action points and overlooking India’s active role in terrorist activities depicts the favored role of international establishment.

Terrorism in Pakistan

Pakistan has been a target of terrorism since the 1980s. The actors involved have changed, but the underlying cause remains the same. Between 2001 and 2020, there were approximately 19,130 terrorist attacks with over 83,000 casualties in Pakistan.  These numbers reflect the gravity of the situation under consideration.With Pakistan’s participation in the Afghan Jihad, the floodgates of violence were opened, and Pakistan experienced terrorism for the first time. In the final stages of the Soviet-Afghan conflict, the violence reached its pinnacle. The Afghan and Soviet intelligence agencies planned the majority of the attacks. Later on, following 9/11 attacks in United States, Pakistan became a front line of United States in its so-called “Global War on Terror.” Pakistan fundamentally supported the United States and provided logistical support to NATO forces. Seeds of almost two decades long conflict were sown as militant groups, who were initially supported by Pakistan, saw the move as traitorous. When Pakistan military initiated the operations in 2004, the level of violence increased dramatically. The uprising continued and intensified following the operation of the Lal Masjid in Islamabad in 2007. Following these two courses of action, terrorist activity reached an all-time high in the country.

The Indian Sponsored Terrorism

With a widespread ray of terrorism across the state, Pakistan has been blamed as the perpetrator for decades, despite being the victim. India did not leave any stone unturned in accusing Pakistan of being a state sponsor of terrorism. It was India’s diligence that resulted in Pakistan’s admission to the FATF. The FATF’s primary goal is to develop policies to combat terrorist financing and money laundering. FATF expanded its mandate to include terrorist financing in 2001. Since 2018, Pakistan has been on the FATF’s grey list. FATF stated in February 2021 that Pakistan would remain on the grey list and that the decision would be reversed only if further compliance was demonstrated. Pakistan’s efforts were acknowledged, but the position was maintained that Pakistan should focus on the remaining three points out of the agreed-upon 27 points. The main worrying sign is that many FATF member states have noticed that Pakistan has been subjected to one of the most stringent terms in comparison to other countries. The case brought against Pakistan is the result of a powerful Indian lobby, but would the same be true if the tables were turned? Pakistan finally revealed India’s role in terrorism sponsorship on November 14th, 2020. The documents presented were described as “irrefutable evidence” of India’s nefarious activities. India has been involved in funding state and non-state entities for the purpose of sabotaging and threatening Pakistan’s very existence. During the press conference, the DG ISPR and the Foreign Minister presented a set of proofs to show that the India was involved in Pakistan’s internal affairs.

Terror Financing in Pakistan

The dossier included evidence that India is funding terrorism both directly and indirectly. Pakistan has “irrefutable proof” those Indian embassies are being used as a hub of terror sponsorship against Pakistan. There was a conversation between the Indian ambassador to Afghanistan and the Indian consulate in Jalalabad in which they discussed the monetary support for the TTP and Baloch separatists. Proofs regarding millions of dollars payment to TTP leadership were also presented by Pakistan. Avinash Paliwal wrote in his book “My Enemy’s Enemy” that Indian intelligence officials accepted the TTP and Baloch separatists’ dependency on Indian financial support, and that they would approach Indian officials stationed in Afghanistan for payment. RAW has also provided advance weapons and ammunition to the terrorists to aid in on-the-ground operations. The DG ISPR mentioned one such captured network that was given millions of rupees in exchange for carrying out suicide and IED attacks, target killings, and implanting vehicle-borne improvised explosive devices. Throughout the years, Indian intelligence has worked to ignite separatist movements across Pakistan. India has made four transactions worth approximately $23.35 million for Baluchistan for the aforementioned cause. Almost $60 million was set aside for sabotage of the CPEC. Kulbhushan Jadhav, the captured Indian Navy Commander, had already made revelations about India’s role in terror financing within Pakistan.Internally, factions such as the MQM, led by Altaf Hussain, received not only weapons but also financial support from anti-Pakistan elements to pursue their terrorized politics within Pakistan, particularly Karachi.  According to a recent report by the US Treasury Department’s Finance Crimes Enforcement Network, Indian banks were involved in money laundering and the funds were used to sponsor terrorism. According to data, approximately $1.53 billion was transferred illegally through 3,201 transactions between 2011 and 2017.

Since the 9/11 attacks on US soil, Pakistan has been engulfed in a war that has caused economic, political, and social upheaval. Pakistan appeared to be fighting a war against terrorism, but deep within, hidden networks were working to weaken and drag the country further into an unending conflict.With India vehemently lobbying for Pakistan to be blacklisted by FATF, the presented dossier is more than enough to expose India’s demonic role in terrorism sponsorship. Pakistan has been dragged into a vicious cycle since 2018 when it has been blamed for money laundering and terror financing. With the available and credible evidence, the FATF must consider India’s active and tyrannical role. These measures are clearly aimed at Pakistan, a country that has been a victim of terrorism for decades. As a result, the provided proofs should not be rejected but rather considered for further investigation. Pakistan, on the other hand, has taken some steps to help alleviate its situation. Terror financing through such long channels has been a disturbing factor for Pakistan. As a result, Pakistan has been working on legislation titled the “Anti-Terrorist Act 1997” since 2014, which would act against individuals involved in terrorism by confiscating their property. The Counter Terrorism Wing is another step in the right direction. One of the Counter Terrorism Wing’s responsibilities is to detect and investigate terrorist financing/money laundering cases. Pakistan has been working to take measures and concrete steps against religious groups such as Tehreek-e-Labaik Pakistan (TLP) and Lashkar-e-Taiba (LeT) in order to safely exit the grey list.

Pakistan’s evidence strongly suggests India’s involvement in money laundering and terror financing. India has provided support to UN-designated terrorist organizations such as the BLA, JUA, and TTP. Now is the time for the international community to take tough measures against India for its support of terrorism, in accordance with international law. Furthermore, Pakistan’s role in combating terrorism must be recognized in addition to its inclusion on the white list. The world has already seen the vicious face behind the smiling Buddha’s creators. The only thing left to do is act for the sake of regional peace and stability.




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