How Lashkar-e-Taiba generates money

It is becoming clear that the US and other Western nations have failed to rein in one of the most resourceful and powerful terrorist groups in the world, Lashkar-e-Toiba (LeT). The group has not only remained intact after the Mumbai attack of November 2008 but has grown manifold in the years since, if the secret documents from the US State Department made public recently are read carefully.

According to the US State Department documents, the terrorist group spends over $ 5 million every year to recruit, train and launch terrorists not only against India but also against the US and other Western nations. This money was spent by Zaki-ur Rahman Lakhvi, the jailed LeT operations commander “to purchase all materials required for LeT operations other than weapons and ammunition”.

The LeT generates this huge cache of cash from private donations, NGOs, madrassas and business spread throughout South Asia, the Middle East and Europe. Substantial part of the funding comes from Saudi Arabia and Kuwat where LeT has considerable support not only among the Pakistani diaspora but also among Muslims from other countries. Besides, the terrorist group also enjoys the patronage of the royal families and other elites in both these countries allowing it to solicit funds for terrorist activities quite openly.

The group, however, draws maximum from Pakistan where businessmen, industry leaders, farmers and others donate freely for the terrorist cause. These donations are collected throughout the year, across Pakistan, sometimes in the name of religion and often, openly, for `jihad`.

The documents say that while parts of the funds were used for charitable purposes, large portions were diverted to strengthen its terrorist infrastructure. One report shows how LeT’s charity front, Idara Khidmat-e-Khalq, in December 2005 was issuing Jamaat-ud Dawa receipts for donations collected in Saudi Arabia. Jamaat is the parent body of LeT. The group operated through a “front company in Saudi Arabia where an LeT finance official may have been closely associated with the general manager possibly acting as a front for moving LeT funds”. Another memo confirms that “Saudi Arabia remains a critical financial support base for al-Qa'ida, the Taliban, LeT and other terrorist groups, including Hamas, which probably raise millions of dollars annually from Saudi sources, often during Hajj and Ramadan.”
 
Although Saeed himself does not travel abroad, fearing arrest or murder, it is his brother-in-law and second-in-command of the terrorist group, Abdur Rahman Makki, who travels frequently to Saudi Arabia and other Middle East countries to generate funds. He has been known to seek donations in the name of building a new school or upgrading madrassas in Pakistan. Highly inflated costs of construction were projected to potential donors at a madrassa, enabling the group to siphon off the ‘charity’ funds for terrorist activities.

Another method, revealed by the leaked cables, is to siphon off the money given to the group by Haj pilgrims. One memo says that the LeT leadership used the annual Haj pilgrimage for laundering money and cash from pilgrims. This, the memo says, was also used to finance the Mumbai terror attack. This finds confirmation in another memo which details how Saeed and Lakhvi had “planned, directed, and executed LeT attacks throughout South Asia and likely have used some funds collected in the name of JuD’s charitable activities to support multiple LeT terrorist operations, including the November Mumbai attacks.”

Ironically, LeT is perhaps the only terrorist group in the world which gets grants from the government. Last year, the Punjab government in Pakistan gave a grant of close to $1 million to LeT’s parent body, Jama'at-ud-Da'wah (JuD), banned by the UN and US, besides India and several other countries around the world, to run its chain of schools and welfare organisations.

Since it is clear that Pakistan, despite the international pressure, will not do anything to weaken its ‘strategic asset’, the international community must step up its pressure and activities to stem the financial flow to the terrorist group. This must be done urgently and on a global level to starve the terrorist group of funds without which it will die a natural death.

Rajeev Sharma is a New Delhi-based strategic analyst and a senior journalist who has authored five books on foreign policy, strategic issues and terrorism

(The views expressed in the article are that of the author and do not represent the views of the editorial committee or the Centre for Land Warfare Studies).