In a globalized and interconnected world it was inevitable that terrorism would become globally interconnected and truly transnational. The fact that right from the start the US declared a ‘war’ on terror instead of treating terrorists as criminals and arresting and prosecuting them helped the terrorist networks to link up and establish lifelines for support and survival. By far the most important and the most elusive lifeline is the financial lifeline over which finances flow world wide to what has become Terrorism Inc.. Strangulating this life line has to be an integral part of any over-all counter terrorism strategy.
No state on its own has the capacity to stem the financial flows especially the flows from outside its borders. This means that this is an area where states have to cooperate by exchanging information and intelligence. Terrorists use multiple channels to move finances — the formal national and international banking channels, the various remittance systems available as movement of money becomes easier and convenient and then there is the risky use of couriers called ‘mules’. They also use a variety of cut-off systems to conceal the actual source of funds as well as the identities of the sender and recipient.
With a large number of Pakistanis, Indians and Bangladeshis working overseas in the West and the Middle East a very sophisticated and trust worthy system of moving money is well established. Known locally as the ‘havala’ or ‘hundi’ this system operates on trust and completely outside banking channels. Money is handed over to the ‘dealer ‘in the country from where the money is to be sent. The person handing over the money may be just a courier to hide the origin of funds and actual identity of the sender. The dealer sends the instructions to his counterpart in the country where the money is to be delivered and again the recipient may be a courier using a false identity. The money may or may not actually move as the dealers have accounts in many countries and in many currencies.
There is a well established tradition of charity and zakat (mandatory charity for Muslims) which flows from the rich to the poor and from the richer Islamic countries to the poorer ones. Clerics carry out very active and sometimes coercive fund raising within their countries and during tours abroad for religious purposes. These funds are also used to fund seminaries and madressahs. While some of these are imparting education but some are involved in radicalizing and even training for terrorist acts. Terrorists very cleverly create and manage sympathy for their cause among a gullible population eternally seeking salvation.
Terrorists foster lawlessness to weaken the state’s law enforcement machinery and eventually overwhelm it. This means creating ethnic and sectarian fissures that are then exploited to foster violence. Nascent separatist movements are fanned into full blown insurgencies against the state. Extortion, kidnapping for ransom, bank robberies, dacoities, carjacking, and drug, weapons and people smuggling are quick means of getting finances by creating mafias to control and direct these activities. Even hit men for hire are made available for politically motivated killings or simply to create confusion and mayhem. External intervention that seeks to undermine the state and its institutions exploits these vulnerabilities for their own purposes.
Pakistan is riddled with all these activities and these are the result of over three decades of protracted violence in our neighborhood that has now spilt over into the cities and of course is rampant in FATA. Any internal security strategy that is formulated has to not only strangle the channels for financial flows but has to be much more comprehensive by making the media and public opinion part of the overall strategy. Law enforcement capacity has to be built up and not allowed to get overwhelmed. A lead intelligence agency has to be designated from within available resources till more structures can be created. Above all the focus should be on human security and economic uplift because deprivation, oppression and poverty are the tools that terrorism uses for recruitment.