Biggest terror threats to India come from ISIL and Al-Qaeda-linked groups in J&K: FATF report

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Paris – The most prevalent and significant source of terrorist financing (TF) in four out of six conflict zones in India comes from outside the country’s borders, the latest Mutual Evaluation Report released by the global Financial Action Task Force (FATF) on Thursday showed. The report also said that the top terrorist threats appear to be linked to ISIL or Al-Qaeda (AQ)-linked groups operating in and around Jammu and Kashmir.

The FATF, which develops and promotes policies to protect the global financial system from money laundering, terrorist financing and proliferation financing of weapons of mass destruction, acknowledged that India has continued to face the effects of terrorism since its independence in 1947 and continues to face a “diverse array of terrorist threats” divided into six different theatres.

“These can be summarised as theatres associated with ISIL or al-Qaeda (AQ) extremist groups operating in and around Jammu and Kashmir, either directly or through intermediaries or affiliates, as well as other separatist movements in the region; other ISIL and AQ cells, their affiliates, or radicalised individuals in India; regional insurgencies in north-east and north India; and left-wing extremist groups seeking to overthrow the government,” the report said, praising Indian agencies for demonstrating a “good understanding” of both current and emerging terrorist financing (TF) threats and risks across different risk theatres.

According to the report, extortion is a major source of income for terrorist groups in the northeast and in areas affected by left-wing terrorism.

The report reveals telling cases of abuse of non-profit organisations (NPOs) with links to terrorist organisations and radicalisation, which received funding from abroad under the guise of funds for charitable activities.

“Terrorist financing risks are generally closely linked to terrorism risks, with flows of money or other assets restricted to India or neighbouring countries… The TF risk assessment identified several forms of terrorist financing, including from sources outside India, organised criminal gangs, extortion, NPOs, counterfeit Indian currency notes, narcotics financing, virtual assets and illicit arms trafficking, with each showing varying magnitudes depending on the theatre,” the report said.

The competent authorities noted in the report that the use of virtual assets is an emerging trend for TF in general, due to the difficulties it poses in tracking funding.

At the same time, the FATF praised the Indian government’s prevention strategies, including counter-radicalisation initiatives such as the ‘Sahi Raasta’ initiative launched in 2022, which aims to prevent radicalisation among youth in Jammu and Kashmir, where groups linked to ISIL and AQ are active.

It was noted that Maharashtra has also launched a campaign to prevent terrorism, allowing perpetrators of terror financing to surrender so that they can be rehabilitated.

In its report, the FATF commended the Indian authorities for demonstrating a “good understanding” of both current and emerging terrorist financing (TF) threats and risks across various risk areas in the country, and for conducting investigations in line with the identified risks.

“The case studies provided reflect India’s ability, particularly the National Investigative Agency (NIA) and ED, to conduct complex financial investigations and identify financial flows to support investigation and prosecution of terrorist activities and TF,” the independent intergovernmental body said on Thursday while releasing its Mutual Evaluation Report.

The Mutual Evaluation Report also commended India for achieving a “high level of technical compliance” with the recommendations and taking “significant steps” to implement measures to tackle illicit finance.

“A joint FATF-APG-EAG assessment of the country’s measures to tackle illicit finance concludes that India has implemented an anti-money laundering and countering the financing of terrorism (AML/CFT) framework that delivers good results, including understanding risk, accessing beneficial ownership information and depriving criminals of their assets. Authorities make good use of financial intelligence and cooperate effectively, both domestically and internationally,” the report said.

The report summarises the AML/CFT measures in place in India and analyses the level of compliance with the 40 FATF recommendations and the level of effectiveness of India’s AML/CFT system. It also provides recommendations on how to strengthen the system. (IANS)