Question.
Give out the major sources of terror funding in India and the efforts being made to curtail these sources. In light of this, also discuss the aim and objective of the "No Money for Terror (NMFT)" Conference recently held in New Delhi in November 2022.
(UPSC 2023 General Studies Paper 3 (Main) Exam, Answer in 150 words)
Answer.
Terrorist organizations are often dependent on various sources of funding to sustain their activities. In India, the following are major sources of terror funding:
External Funding ( Hawala Transaction) :
Terrorist groups receive financial support from foreign entities, state-sponsored sources ( Pakistan), or external extremist organizations.
For example, Indian extremists receive remittance and radical charity from Gulf Countries.
Religious Donation ( Zakat):
Terrorist groups in India receive terror funding, in the form of zakat.
Illegal Trade and Smuggling ( Narco-Finance):
Terror funding in India is also done through drug trafficking ( primarily from Afghanistan and Pakistan), arms smuggling ( primarily from Pakistan and China), and counterfeit currency circulation ( primarily from Pakistan).
Extortion and Kidnapping:
Terrorist groups do extortion and kidnapping for ransom to generate funds from businesses, individuals, and even government entities.
India has implemented a multi-pronged approach to combat terrorism financing:
Financial Intelligence Units ( FIUs):
Financial Intelligence Units ( FIUs) play a crucial role in monitoring financial transactions, identifying suspicious activities, and sharing intelligence with law enforcement agencies with law enforcement agencies to prevent terror financing.
Money Laundering Act, 2002:
It empowers the Enforcement Directorate to investigate money laundering offenses and coordinate internationally.
Monitoring Charitable Organizations:
India has strict regulations on charitable organizations and NGOs, which helps prevent the misuse of these entities for funding terrorism. It ensures transparency and accountability.
International Cooperation:
India is a member of an international organization that monitors terror funding, like the Financial Action Task Force ( FATF).
India collaborates with other countries to share intelligence and coordinate efforts to track and block external sources of terror funding.
In this regard, "No Money for Terror (NMFT)" is a global initiative to combat terror finance. This Conference was recently held in New Delhi in November 2022.
The following are the objectives and aims of the "No Money for Terror (NMFT)" Conference:
Sharing Knowledge and Practice:
The conference aims to provide a global platform to share best practices and intelligence to combat terror financing. It also discusses the FATF guidelines.
Emerging Areas:
Cyberterrorism is recognized as an emerging area of terror financing.
Condemning State-sponsored terrorism:
The conference is also aimed at condemning the state-sponsored terrorism. Pakistan supports terrorism and illegal activities in India.
Civil Society Engagement and Awareness:
The conference also aims to spread awareness and promote civil society engagement regarding countering terror financing.
Monitoring and Evaluation:
The conference aims to monitor and evaluate the global standard of terror funding. It also aims to improve the transparency of financial systems and foster information sharing among nations to trace terror funding. For example, the SWIFT ( Society for Worldwide Interbank Financial Telecommunications) messaging system.
In summary, countering terror financing is an ongoing challenge that requires continuous adaptation to evolving methods used by terrorist organizations. In this regard, cooperation with intelligence agencies, law enforcement, financial institutions, and international collaboration is crucial in curbing terror funding and disrupting terrorist networks.
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