The ISI has on its list Indian politicians who continue to indulge in hawala transactions and the flip side to it is that these politicians are blackmailed each time there is a purposeful inquiry sought into this issue.

Intelligence Agencies have gone into this issue several time since the past 20 years, but there never has been a closure and some officers tell rediff.com that this is largely due to political pressure. It would not be right to say that these politicians who are being blackmailed by the ISI are directly indulging in terror activities, but they do ensure that the probe which could identify the routes is being hampered due to undue interference.

Colonel RSN Singh, former officer with the Research and Analysis Wing (R&AW) writes that there are enough reasons to believe that some politicians are being blackmailed by the ISI and Hafiz Saeed because of their hawala and other links. This was clearly evidenced when separatists in Kashmir met Sartaz Aziz, Nawaz Sharif’s envoy in Delhi. It was in evidence also when Hafiz Saeed shared stage with Yasin Malik in Pakistan.

The issue shot to the limelight after the 1993 Bombay serial blasts when the Home Ministry had listed out names of politicians who had taken help of the underworld and terrorist elements to stash cash away through hawala channels. The report stated that there was a definite nexus between politicians in Maharashtra and the underworld. It further went on to state that a hawala racketeer Choksi who was also involved in the Jain Hawala case had transferred sums of Rs 72 crore to politicians from Maharashtra through hawala transactions.

While states such as Maharashtra have been notorious for such transactions, todays reports would suggest that several politicians from Kerala are stashing away cash from the Gulf through hawala deals. An intelligence bureau official says that there is nothing on record that would show that these politicians are aiding the terrorists. The problem is because the money involved in so huge and they need big time operatives to stash their money away. Unfortunately these persons who stash such money for our politicians are the same ones who do the work for the terrorists or the underworld which is directly under the control of the ISI. The ISI has managed to pick up the names of these politicians and continue to blackmail them each time India has tried raising or sorting out the hawala issue.

Former Chief of RAW, C D Sahay says that a hawala transaction is not confined to financing terrorism alone. There have been instances of people not involved in terrorism indulging in such transfers as well. I would not be surprised if large sums of money belonging to powerful people such as politicians are changing hands and anti social elements have got a whiff of the same.

V Balachandran, former RAW officer says that these allegations are being made since the past 20 years. The Vohra committee had gone into this, but that report is still classified. There are reports today of Kerala politicians indulging in hawala transactions and only a purposeful probe can sort out this issue.

Politicians have used hawala transactions an alternate money remittance system since the past 20 to 25 years. Their money has changed hands through operatives in countries such as the Middle East, North Africa and South Asia.

The Intelligence Bureau says that hawala is being used both by some politicians and businessmen. After they gather large sums of money, they take the help of a hawala operator and transfer these large sums of money into foreign accounts. A lot of this money which has been earned through illegal means has been laundered off into Swiss Banks by hawala operators who incidentally work for terror groups and the underworld too.

One may recall the dreaded Jain Hawala scam in which a bribery amount of 18 million dollars was involved. Many leading politicians are alleged to have got money and all this cash landed into their hands through a hawala broker. It was at this time that it was alleged that some of this money was used to support Kashmir based militant groups such as the Hizbul Mujahideen.

The IB says that the worry is that there are high profile personalities involved in this. There are politicians, businessmen and film stars too who have used hawala to ensure that their money is non taxed. The ISI ensures that any deal to finance terrorism is carried out through a hawala transaction. It is infact through the blessings of the Pakistan spy agency that operators are able to work smoothly. The ISI safeguards these operatives and today they are also blackmailing Indian politicians each time there is a sign of a probe.

Several agencies have probed into this aspect but the proofs have been tough to come by due to the kind of influence that is involved in this racket. The money that is involved is obscene and persons involved in transferring black money through a hawala channel would go that extra mile to safeguard the money, the IB points out. The ISI too is aware of this and hence blackmailing such persons is always easy. These statistics would give a fair idea of the kind of money that is involved in such rackets.

The total amount that is involved in such transactions since the past 25 years is an obscene Rs 73 lakh crore. Between 2002 and 2006 about 692,328 crore has been the illegal financial outflow from India alone. Not only has this amount gone to the Swiss Banks through hawala channels, but money has also been stashed away in other tax havens as well.

(Story first published on rediff.com)