Q. Give out the major sources of terror funding in India and the efforts being made to curtail these sources. In the light of this, also discuss the aim and objective of the No Money for Terror (NMFT) Conference recently held at New Delhi in November 2022.

Model Answer: 

Terror financing is the lifeblood of terrorism. India faces a multi-dimensional threat from terror funding, necessitating robust domestic mechanisms and proactive international countermeasures.

1. Major Sources of Terror Funding in India

1. Hawala & Informal Channels: Bypassing formal banking systems for cross-border fund transfers (Kashmir separatism).
2. Fake Indian Currency Notes (FICN): Smuggled via porous borders to destabilize the economy (Indo-Nepal, Indo-Bangladesh routes).
3. State-Sponsored Funding: Direct funding, training, and logistical support by hostile neighbors (Pakistan’s ISI).
4. Organized Crime: Nexus with narcotics, arms smuggling, and illegal extortion (Golden Crescent heroin trade, North-East insurgencies).
5. Charities & NGOs: Misuse of non-profits and religious trusts for radicalization (banned outfits like PFI).
6. Emerging Technologies: Anonymity provided by Cryptocurrencies, Dark Web, and crowd-funding platforms (lone-wolf radicalization).

2. Efforts to Curtail Terror Sources

1. Legal Frameworks: Stringent amendments to the Unlawful Activities (Prevention) Act (UAPA) and Prevention of Money Laundering Act (PMLA).
2. Institutional Upgrades: Establishing the NIA’s Terror Funding and Fake Currency (TFFC) Cell and empowering FIU-IND.
3. Demonetization (2016): Disrupted existing FICN stockpiles and terror-linked cash hoarding.
4. Global Coordination: Driving strict compliance with Financial Action Task Force (FATF) mandates and UN Security Council sanctions.

3. ‘No Money for Terror’ (NMFT) Conference 2022: Aims & Objectives

1. Zero-Tolerance Consensus: Forging global unity against state-sponsored terrorism and dismantling safe havens.
2. Regulating Emerging Tech: Creating unified regulatory frameworks to counter the misuse of cryptocurrencies and the Dark Web.
3. Monitoring Crowdfunding: Securing the non-profit sector to prevent charitable donations from being diverted to terror outfits.
4. Permanent Institutionalization: India proposed establishing a permanent NMFT Secretariat in New Delhi to sustain global coordination.
5. Strengthening FATF: Standardizing FATF rules and enhancing its mandate to proactively investigate terror financing networks globally.

Choking the financial lifelines of terrorism requires a “One Mind, One Approach” global consensus, integrating advanced technological surveillance with stringent, universal FATF compliance.