Demonetisation in Kerala: Terror outfits use contraband money to indoctrinate youths

Kerala is one of the few states where demonetisation of Rs 500 and Rs 1,000 currency notes generated so much heat. The state witnessed a rare phenomenon of the entire state Cabinet sitting on a day-long dharna with the mutually acrimonious ruling party and the Opposition joining hands against the Union Government over the issue.

Economic experts are wondering why the demonetisation move aimed at flushing out black money has met with so much protest in Kerala, which incidentally is the country’s first total banking and completely digitised state. They feel it could be because of pressure from the black money lobbies.

Firstpost spoke to a cross-section of experts to get a dispassionate view of the situation. This is the third in a four-part report. You can read the first part here and the second part here.

No one in Kerala believed that terrorism could take root in the state, but the developments since the demolition of the Babri Masjid in 1992 forced them to change their perception.

Many outfits borne out of the Muslim anger later took radical turns.

Demonetisation in Kerala: Terror outfits use contraband money to indoctrinate youths

Representational image. PTI

Seeds of radical thoughts sowed by outfits like the National Development Front (NDF), which was one of the first radical outfits to be established after the mosque was pulled down, have made the state today a breeding ground for terrorists. Police and intelligence sources see the role of hawala money and counterfeit currency behind the transformation.

Sources said many of these outfits use the money to promote and propagate radical thoughts. Though finance for terror comes from many sources, Saudi Arabia is said to be the single largest financier of terror in India. Saudi contributes more to terror because many in the country share their ideology.

The money for terror outfits in the country is routed through Kerala, Uttar Pradesh and Andhra Pradesh. Officials have no clear idea about the amount of money arriving in the country for terror activities.

A recent report in said that 10 percent of all hawala transactions coming to India were terror finance. The report further said that terrorists were getting 30 percent of their funds from hawala.

Officials said it was difficult to detect terror fund as it gets mixed with hawala transfers made by the expatriates in the Middle East. The donor agencies also take special care not to send the money to people under the police radar. They have unassuming people to collect the money and take it to the targeted people.

Hormis Tharakan, former chief of Kerala state police and Research and Analysis Wing (RAW), says the bulk of contraband money received by radical outfits were going to indoctrinate youths. He said that terrorist outfits were now targeting young educated youths as they want people who are able to handle technology.

“Most of the people, who left the state in July with the aim of joining the Islamic State, are such people. The group of 21 youths from Kasargod and Palakkad who are suspected to have joined the Islamic State included engineers, doctors and business graduates,” Tharakan told Firstpost.

The former RAW chief said that youths from Kerala were getting increasingly drawn to radical groups because of their interactions with diverse forces across the world. They have been able to come into contact with different forces as a result of the migration.

“The IS and other terror outfits are spending more money on motivating such youngsters. They will also need their service if they succeed in their attempt to set up their Caliphate in various parts of the world,” Tharakan said adding that information suggested he had a dentist, who was among the 21 youths who crossed the border, and had set up a dental clinic at Khorasan in Afghanistan, a stronghold of IS.

The extremist organisations in the state have been using the funds they are getting to promote their radical thinking in a systematic manner by setting up communication and education channels. A school in Ernakulam funded by an Islamic agency introduced religious content in the teaching in addition to the Central Board of Secondary Education (CBSE) syllabus that the school follows.

The religious lesson set by the Peace International School for Standard 2 students asked the pupil’s willingness to die for Islam. After directing the school to remove the lesson, the Education Department has referred the matter to the police, who have registered a case against the school authorities.

Peace International School had caught media attention after three of its employees joined the group of 21 missing youths from Kasargod and Palakkad. The school was also found to have received money from some suspicious sources.

The state police are probing two such transactions the school run by Kozhikode-based Niche group received from Kashmir and Hyderbad in August 2015. Niche group founded by MM Akbar, who is called the Zakir Naik of Kerala, is running two conversion centres at Kozhikode and Poonani in Malappuram district. A graduate in Physics, Akbar is a religious orator and an expert in comparative religion.

A senior police officer at Kozhikode said hawala money and fake currency were also being used to fund terror activities across the country. He pointed out that investigations had revealed that hawala money pumped into the state was used in the blasts at Delhi, Bangalore, Mumbai and Ahmedabad.

The money for terror outfits in the country is routed through Kerala, Uttar Pradesh and Andhra Pradesh. Officials have no clear idea about the amount of money arriving in the country for terror activities.

The National Investigation Agency (NIA) suspects the role of Mumbai blast accused Tahir Merchant alias Tahir Taklya behind two containers of counterfeit currency rumoured to have landed at Kochi port in 2009. They believe that Taklya, while working as a manager with a firm in Sharjah, had sourced the fake notes from Pakistan.

The NIA has launched a reinvestigation into the matter following fresh information received from a person who was arrested with fake notes worth Rs 72.5 lakh from the Kozhikode international airport.

The Kerala police, who investigated the rumour, did not register any case as no seizures were made. The state Bharatiya Janata Party has alleged the hand of higher ups in the then Left Democratic Front (LDF) government behind the mysterious disappearance of the two containers.

Mohammed Sabir alias KP Sabir alias Ayub, who is an accused in the case related to the attempt on the life of former chief minister late EK Nayanar, controls the terror-related fake Indian currency notes (FICN) cartel operating from Peshwar in Pakistan.

A native of Kannur in north Kerala, Sabir was the former president of the now banned Students Islamic Movement of India. His links with international terror cartel came to light after the Bengaluru serial blasts in 2008. According to intelligence sources, Sabir escaped to Pakistan immediately after the blasts on a fake passport.

Tharakan said that the role of contraband money behind terror strikes was minimal since weapons used in such strikes come mostly from Pakistan. The weapon now being used commonly is improvised explosive device (IED), he added.

Tharakan said that counterfeit currency was not being used much in terror operations. The fake currency is mostly being used by Pakistan to subvert the Indian economy. He said the neighbouring country was able to do it successfully as it was not easy to detect the Indian currency produced by them. They were using the same machines and ink used by India to print counterfeit Indian currency notes, he added.

Though criminal activities fuelled by hawala are on the increase the authorities have not been able to crack the rackets. CM Pradeepkumar, a retired superintendent of police who was among those who probed the Marad communal riots in Kozhikode, said police were unable to do much in hawala and fake currency note cases since they come under the purview of Directorate of Revenue Intelligence and other concerned agencies.

“When the police come across such cases, we arrest the culprits and hand over the case to the agencies concerned. The agencies in many cases let off the culprits after levying the fine,” Pradeepkumar said.

Former director general of police Jacob Punnose has additionally alleged lack of political support in tackling terror cases. He said that a strong case made by the police about the undercover operations of some terror modules in the 1990s was spurned by the then political leadership.

This was because of the general presumption that terrorism will not take root in Kerala. Even the police were not free from this complacency. The steady growth of radical forces from NDF in the early 1990s to the IS now has shaken off this complacency.

Part One: Hawala, fake notes play big role in state's economic growth
Part Two: Curbs on cooperative banks are hurting Non-Resident Keralites

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Updated Date: Nov 23, 2016 19:24:41 IST

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