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Terror Financing. Pixabay

Pakistan’s restive northwest province Khyber Pakhtunkhwa has issued directives to its administrative and security departments to make serious efforts to cut off the money supply of banned terror groups.

The provincial departments have been instructed to devise a strategy to crack down and to closely monitor the proscribed groups and individuals involved in raising funds illegally for welfare or religious purposes, Pakistani media reported.


Despite its continued efforts against terrorism, terror financing remains a challenge for Pakistan due to political resistance, sympathizers and money trails that are hard to track, analysts say.

“Pakistan will have to come up with a strategy to freeze assets of terror groups, make it difficult for terrorists to gather funds, but to also spot those who’ve adopted new identities and have re-established their networks,” A. Z. Hilali, head of political science department at the Peshawar University told VOA.

Suspect groups identified

The official document circulated by Khyber Pakhtunkhwa’s government emphasized banned groups are not allowed to gather money “under any circumstances” and security forces and the administration should ensure people and groups raising money for mosques, charity or madrassas (religious seminaries) are lawfully doing so.

In 2015, Pakistan banned around 200 terror groups after establishing their involvement in sectarian and terrorism related activities against the state.

Pakistan had also frozen around $3 million worth of assets of 5,000 suspected terrorists last year. “We will make every possible effort to implement National Action Plan (NAP) to counter terror financing in our province,” Shaukat Yousafzai, spokesperson for the Khyber Pakhtunkhwa government told VOA.

“We’re the biggest victim of terrorism and we do not want them [terrorists] to succeed. We’ll also work to start awareness programs so that banned groups can be prohibited from gathering funds from the masses,” Yousafzai said.

A report issued by the Financial Monitoring Unit of Pakistan in March estimated the annual operational budget of terrorist organizations is $48,000 to $240,000.

The terror groups in Pakistan generate hefty amounts through charity and welfare work, receive huge foreign donations and use the “hawala system,” an alternative finance system, used for money laundering, experts say.

Also Read: US has given Pakistan $265 million to fight terror: US State Department report.

National plan

Pakistan’s National Action Plan, a comprehensive strategy aimed at eliminating extremism mentions the state should “choke financing for terrorist and terrorist organizations.”

Hilali says there is a need to introduce legislation to prohibit collection of funds from the general public. “Terrorists collect large sums of money especially during the holy month of Ramadan under the guise of Zakat [mandatory Islamic charity].”

“The madrassas [religious seminaries] also play an important role and we are aware that a few of them remained involved in collecting funds on behalf of banned terror outfits in the past,” Hilali added.

Security analysts also stress that the government should regulate and register all the religious seminaries across the country and should practice caution before making donations to religious organizations and seminaries.

In 2016, Khyber Pakhtunkhwa’s government received scathing criticism when it allocated a grant of $3 million to Darul Uloom Haqqania, a religious seminary that is interpreted by some critics as the “University of Jihad.”

The Haqqani network, considered a terrorist group by Afghanistan and the United States, continues to fight Afghan and U.S. forces in Afghanistan.

U.S. officials have long accused Pakistan of providing support to the Haqqani network. The U.S. State Department released its annual Country Report on Terrorism 2016 earlier this month. It criticized Pakistan and said it remained unsuccessful in stopping the activities of the Afghan Taliban and the Haqqani network. (VOA)


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