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Why peace with India is Pakistan’s only option to get out of its economic mess

Peace with India can help Pakistan's economy (Image Courtesy: Twitter/@MaheenUsmani)

Soon after assuming office in Islamabad, the newly anointed Pakistani Prime-Minister Shehbaz Sharif headed for Saudi Arabia and the United Arab Emirates. His motivation was clear—to seek finances that would help bailout the Pakistani economy,  which was on life support. Projected inflation in Pakistan for the financial year 2022-23 according to an Asian Development Bank (ADB) report was 11% . The fallout of the Ukraine-Russia crisis, especially the rise in oil and food prices was also hurting Pakistan badly.

The country’s deficit has swollen  from USD 2.5 billion in 2015 to USD 13.5 billion in 2019.  

But Sharif’s endeavours immediately hit a roadblock when the  UAE, Saudi Arabia and China linked a possible financial bailout to the stance which the International Monetary Fund would adopt on providing financial relief to Islamabad.

After his “mission not-accomplished” in the Gulf, the beleaguered Pakistani premier finally turned to Turkey. Not only are the two Islamic republics, both Turkey and Pakistan  find a lot of common ground on Kashmir, taking the cue from Palestine.

 Turkey (now called Türkiye) has very well bought the idea of Kashmir bugled by Pakistan and has offered relentless support in the several international forums. Both countries want to fully internationalise Kashmir.

But ideological bonding apart, Turkey is itself experiencing severe economic turbulence.  Ankara’s  economy has been facing a steep downturn. Annual Inflation in Turkey has hit a record high of 73.5% since 1998. The Turkish lira has lost 48% in value over a period of 1 year. So, Tukey too was unable to bailout Pakistan.

On the contrary,  India, growing at a healthy 8 percent could have been an option to lift the Pakistani economy, had Sharif decided to think out of the box. But instead of reaching out to India, Pakistan has  continued to impair ties with New Delhi by becoming a resource hub for the so-called Kashmir Jihad. The recent verdict on Yasin Malik by the Patiala Court in New Delhi is just one example of foreign involvement of conspiring and raising funds for terrorist acts in Kashmir.

Let us have a look at some of the common means and methods employed by the state of Pakistan to fulfil their illicit ambitions through non-state actors in the region of Jammu & Kashmir. 

Narco-terrorism, that is selling narcotics to fund terror has been  routine.  “An estimate by Ex-NCB Zonal director, J&K, indicates that more than 25% of the money spent on terrorist activities in India by ISI comes from narcotics drugs trade” . Very recently, in a 3-day long joint operation by Indian Army and J&K police in Poonch seized 44-kg of narcotics near LoC.  

Besides, non-governmental organizations, charities, and donor agencies form part of  terror financing network in Kashmir. This kind of financing is usually blurred by deep religious beliefs and the spread of extremist Islamic ideas.  The Hizbul Mujahideen (HM) Chief, Syed Salahuddin, has been involved in exploiting a charity called Jammu and Kashmir Affected Relief Trust (JAKART) for funnelling more than Rs. 100 crores in J&K. Though Pakistan has been the prime facilitator of terror financing in Kashmir, much of the support has also been provided by countries in West Asia that profess Wahabi ideology

In October 2020, NIA had conducted raids in Srinagar and Bandipora at J&K Coalition of Civil Society, Association of Parents of Disappeared Persons of Kashmir, Offices of NGOs Athrout and GK Trust.. Recently in 2021, a special court in Delhi has framed charges against four persons in the Jammu Kashmir Affectees Relief Trust (JKART) terror funding case. It is alleged that the Trust was a front through which Hizbul Mujahideen received ₹ 80 crore between 2004 and 2011 to carry out terror activities in India. 

In an article by Hindustan Times, Turkey is gradually becoming the hub for anti-India activities by funding separatist elements in Kashmir. “Indian security officials believe that much of this radicalisation effort being bankrolled by Ankara was being carried out in coordination with Pakistan’s deep state”.   

The Kashmiri diaspora, which has settled in different parts of the world during the 1990s and has friends and relatives in present-day Kashmir, could make transfer payments in remittances, which would also act as a cover for financing Terrorism. The diaspora, while it remains a perennial source of funding, it instils confidence among the the trans-national actors supporting the Kashmir cause.

The amount transferred by friends and family from different parts of the world remains small which makes it difficult for security agencies to track and do not raise red flags. A part of these direct payments is utilized towards personal expenses and the remaining portion becomes an addition for various political movements under the aegis of separatist or religious organisations. In the book Lifeblood of Terrorism, Vikram Chadha writes, “ The Kashmiri diaspora, from both sides of the Line of Control (LoC), supportive of the clarion call for independence, contributed generously. One of the prominent areas of support was the United Kingdom (UK). There is a large segment of the Mirpuri population from POK, which has settled there”. 

In March 2021, World Kashmir Awareness Forum (WAF), a Washington DC-based Kashmiri diaspora group, has demanded release of Masarat Alam Bhat, a separatist leader who is in jail on being implicated in a terror finance case. Thus, the Kashmiri diaspora would continue to remain an integral and sustainable source for long-term financing needs which serves the geo-political aspirations of Pakistan.  

(Mayank Gupta works on public policy at the Kautilya School of Public Policy, Hyderabad. Views expressed are personal and exclusive to India Narrative)