Prime Minister Narendra Modi's dramatic ban on the country's biggest banknotes will cripple Naxal activities more severely than any security operation could have in the recent past, according to an assessment by highly-placed intelligence and police officials.

In Naxal strongholds of Chhattisgarh, Jharkhand and Odisha, the insurgents have buried their finances in Rs 500 and Rs 1,000 bills deep in thick forests of the three eastern states on the red corridor, top officials told India Today.

VIGIL INCREASED

Security forces have now intensified their vigil after an information that the guerrillas might attempt to dig their expired cash holdings out of their jungle hideouts, the sources added.

"Authorities have stepped-up monitoring of all entry points to the forests where Naxals could have dumped their funds," intelligence officials said.

"If the Maoists are in possession of even a fraction of the amount estimated by security agencies, they will be hit badly," disclosed a senior police official.

Some security officials, however, also warn that a cash crunch could also push the Naxals to a reckless extortion overdrive for liquidity.

The ultra-left militants get much of their financial supplies through extortion from contractors of tendu patta, infrastructure firms and from businessmen.

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According to security agencies, the Maoists also extort illegal mining mafias and charge what is called a Maoist tax from vehicles passing through the so-called "liberated zones" in red belts.

"MAOISTS MAY HAVE BURIED RS 7,500 CRORE UNDERGROUND"



In its 2013 report, the Institute of Defence Studies and Analysis pegged the Naxals' extortion revenue at Rs 140 crore per year. But police on the ground consider this figure conservative.

Intelligence officials believe the Maoists could have buried as high as Rs 7,500 crore underground at this point in time in the state.

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In 2007, the arrest of Misir Besra, a central committee member of the CPI (Maoist), revealed the reach of the Maoists' parallel economy.

Besra reportedly disclosed to police that the Naxals had earmarked Rs 42 crore for arms, ammunition and explosives, Rs 2 crore for intelligence-gathering and Rs 16 crore for propaganda, computer training, documentation and transport in their one-year budget. In 2009, Maoists attacked a police team in Bihar and freed Besra.

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Security officials say the exact location of cash dumps is known only to the top committee leaders of the Maoists.

Desperate, these Naxal commanders may now pass on the word to some of their trusted tribals to take the money out, police in Chhattisgarh believe.

The Maoist leaders might be aware that their own movements into jungles could be filled with risks, said a top police official.

Picture for representation. Photo: Reuters Picture for representation. Photo: Reuters

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In Jharkhand, the Naxal extortion machine collects close to Rs 320 crore every year, Central Home-Ministry officials said. But the crucial question is how safe the money stays, they added.

BAG CONTAINING RS 29 LAKH EATEN UP BY TERMITES

In August this year, a bag containing Rs 29 lakh in the 1,000 denomination was eaten up by termites in the Chakri-Bakrakocha jungles of Jharkhand, authorities said. It is believed that the money, obtained through extortion, was buried by Kanhu Ram Munda, one of the CPI (Maoist) leaders in the state.

Maoist influence in Odisha and Maharashtra has been on the wane though. Last month's shootout in Odisha's Malkangiri, in which 30 Maoists were killed, is a pointer to the ability of the security forces to push them on the backfoot and hit their leadership, senior officials say.

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But given the expenditure incurred by the Maoists on intelligence-gathering, weapons and ammunition and medical emergencies, it is not yet clear how much they would be putting in for safekeeping of their finance dumps in forests.

Police sources say Maoists are also reported to pay a monthly remuneration to their cadre in the range of Rs 2,000 to Rs 5,000, depending on their so-called rank and tenure in the outlawed organisation.

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Since November 10, police are also keeping an eye on banks in Maoist-affected areas for anyone coming with large amounts.

Overground Maoist sympathisers in villages, towns and cities could also be safekeepers of Naxal cash, intelligence officials suspect.

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