New Economy of terror

In the business of global terrorism, Western capitalism and jehad have found common purpose Each time one opens a newspaper in America, one aids Osama bin Laden financially


M ONEY MAKES the world go around. So it does for international terrorism. Even the business of sending across jehadis to do battle in the Kashmir Valley is expensive — it can cost up to nearly Pakistani Rs 250 million in one operating season in one sector for one terrorist group. Now imagine other terrorist outfits operating from other sectors across the LoC, and the sum adds up to an astronomical amount for just one operating season. And the war (wrongly called low-intensity conflict) has been on for more than a decade! Considerable profit is to be made by local functionaries and the terrorist overseers from the infrastructure. Inevitably this spawned overnight millionaires in Pakistan. Even so, this spillover from the Afghan jehad is short change compared to the Big Game played internationally.
Although the Saudis matched the US dollar for dollar in the battle against the Soviets in Afghanistan, money was always a problem. The Americans and Pakistanis decided to take the narcotics route, where Afghan opium production was increased, processed and smuggled to rich Western markets. By the midEighties, a lucrative heroin pipeline using the army-owned National Logistics Cell from the north to Karachi was functioning profitably both for the jehad and the controllers.
With between $ 100-200 billion in the kitty, financial managers for money laundering were needed. The Bank of Credit and Commerce International (BCCI), an Arab bank that dealt with financing from nuclear weapons, gun running and drugs and went into liquidation subsequently, provided financial and other logistic support to this operation. The BCCI had 3,000 criminal accounts and all the holders were ‘page 1 news stories’.
The BCCI had Khalid bin Mah fouz, the scion of one of the powerful families of Saudi Arabia and a close associate of the Bin Laden family, as the biggest shareholder ($ 1 billion) in the bank. Khalid was connected with the politically influential business venture, the Carlyle Group, in the US, of which Bush senior was an adviser and people like George Baker and John Major were members. Often they would fly off to Saudi Arabia to meet the Saudi royals and the wealthy, like the Bin Mahfouz and Bin Laden families. The CIA had used the BCCI for illegal arms sales to Saddam Hussein in the Eighties.
Later in the Nineties, anxious to ensure that Turkmen gas was available to American interests like Unocal, the US and the Pakistanis helped the Taliban, hoping that they would provide stability to Afghanistan and enable the $ 4.5 billion pipeline project to go through. Both provided the Taliban with arms and funds to try and defeat the Northern Alliance. As Ahmed Rashid says, “Until 1999, US taxpayers paid the entire annual salary of every single Taliban government official.” Meanwhile, Hamid Karzai, an ex-mujahideen and subsequently a Unocal representative, lobbied for the pipeline deal along with Zalmay Khalilzad. The State Department led by Robin Raphael lent a hand.
The US was comfortable with the Taliban insisting on the imposition of Sharia in Afghanistan. The alliance between American capitalism and Islamic fundamentalism was not limited to the creation of the Taliban. The US explored new avenues for business ventures with the new Taliban regime. Unocal joined hands with Saudi Delta Oil Corporation to form Centgas. Delta Oil is partly owned by the Bin Mahfouz fam ily. Khalid had sponsored many charitable institutions, which were used by Bin Laden’s associates as fronts through the National Commercial Bank which the Mahfouz family controls.
It was through the Centgas consortium that the Bin Laden family became close to the Bush family. Enron had carried out the feasibility study of the Central Asian pipeline and Kenneth Lay was an old Bush buddy. Donald Rumsfeld was a large stockholder in Enron. Bush’s secretary of the army was a vice-chairman of Enron. One of the major beneficiaries in the Centgas deal would have been Halliburton, a pipeline construction giant, which was at that time headed by Dick Cheney.
In the Eighties, the Americans encouraged the Afghans to process opium to fight the Soviets to make up the financial deficit in the cost of jehad. Two decades later, the Northern Alliance was allowed to produce opium as payment for anti-al-Qaeda and anti-Taliban operations. Osama and the others are now trying to enter the retail business of narcotics, where the real profits lie.
The Nineties were a far cry from the early days of dependence on the Cold War sponsors of violence and terrorism. In the Seventies, terrorists began to rely on legal economic activities for raising funds. The buzzword today is globalisation, including in the business of terrorism. Armed groups have linked up internationally, financially and otherwise, have been able to operate across borders with Pakistani jehadis doing service in Chechnya and Kosovo, or Uzbek insurgents taking shelter in Pakistan.
Osama bin Laden is widely known to have controlled a huge transnational business empire. In 1998, President Clinton wanted to impose sanctions on Sudan, including on the supply of gum Arabic (used to fix the print in newspapers, in soft drinks and coating on pills). The US, as the largest importer of gum Arabic and fearing that the French would import the stuff and then offer it to the Americans at a higher price, excluded this item from the list.
Osama had 70 per cent of the shares in the company which supplies 80 per cent of the world’s produce. Each time one opens a newspaper in the US, one aids Osama! Narcotics smuggling generates its own separate business lines, globally connected with arms smuggling and human trafficking, and all dealt with in hundred dollar bills. These black dollars have to be laundered, which is yet another distinctive, secretive and complicated transnational occupation closely connected with these illegal activities and is really a crucial infusion of cash into the Western economies.
This entire terrorism and international crime business has been calculated to be worth about $ 1.5 trillion annually, higher than the GDP of Britain, ten times the size of General Motors and 17 per cent of the US GDP (1998). Loretta Napoleoni says this is divided into three parts. One, US $ 500 billion constitutes money that has moved illegally from one country to another. Another $ 500 billion is generated primarily by criminal activities and called the Gross Criminal Product while the remaining $ 500 billion is the money produced by terror organisations, of which one-third comes from legal businesses and the remainder from narcotics and smuggling. Napoleoni refers to this as the New Economy of Terror.
Extortion, tax levies and demands for awarding contracts to their favoured persons are some of the methods insurgents in North-east India, and lately the Naxals, have been adopting. There is little difference between their tactics and those of various mafia gangs. Across the globe, Hamas and Hizbollah have been using the ‘tri border’ area of Ar gentina, Brazil and Paraguay to launder money, use drug money to purchase and smuggle duty free goods out of South America and purchase arms in Europe.
While terrorism has local vest ed interests, it is also big busi ness, it is global and Western capitalism and terrorism are becoming interdependent. There is thus a huge infrastructural and international tie-up between jehad/terrorism, profits and local interests. No unilateral or uni-dimensional approach will succeed in tackling this menace. Like crime, it will never be completely eradicated.
The ideology of the dollar is the strongest of all.

Source : Hindustan Times 5 Jan 2006