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SOUTH ASIA INTELLIGENCE REVIEW
Weekly Assessments & Briefings
Volume 11, No. 19, November 12, 2012
Data and
assessments from SAIR can be freely published in any form
with credit to the South Asia Intelligence Review of the
South Asia Terrorism Portal
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Banking
for Terror
Sanchita Bhattacharya
Research Associate, Institute for Conflict Management
In what
seems a logical culmination of events, Bangladesh has
been given time until February 2013 to address deficiencies
in its fight against money-laundering and terror-financing
to avert black-listing by the Financial Action Task Force
(FATF). The deadline was set at the FATF meeting held
at Paris between October 15 and 19, 2012. FATF is an inter-governmental
body established in 1989 with the objectives of setting
standards and promoting effective implementation of legal,
regulatory and operational measures for combating money
laundering, terrorist financing and other related threats
to the integrity of the international financial system.
Under this
mandate, Bangladesh needs to adequately address the issue
of criminalising terror financing and establish and implement
procedures to identify and freeze terror assets, and to
remove deficiencies in its anti-money laundering (AML)
legislation and apparatus, to effectively combat the financing
of terrorism.
After the
FATF meeting, one of the members of the four member team
from Bangladesh, headed by Additional Finance Secretary,
Ranjit Kumar Chakraborty, stated, on October 22, 2012,
“We are making preparations for addressing these deficiencies
within the timeframe, set by the FATF… The Government
may consider amending the existing Anti-Terrorism Act
in line with the global standard to adequately address
criminalizing terror financing.” Earlier, in 2009, Bangladesh
promulgated the Anti-Terrorism Act, including provisions
to tighten controls on terrorist financing in the country.
Internationally,
the financing of terrorism was criminalized under the
United Nations International Convention for the Suppression
of the Financing of Terrorism, in 1999. To reinforce the
1999 Convention, the United Nations adopted UNSC Resolutions
1373 and 1390, directing member states to criminalize
terror finance and adopt regulatory measures to detect,
deter and freeze terrorists’ assets. The resolutions oblige
all states to deny financing, support and safe harbour
to terrorists.
Unfortunately,
despite these conventions and resolutions, the U.S. Senate
Permanent Subcommittee on Investigation, in its July 17,
2012, report titled U.S. Vulnerabilities to Money Laundering,
Drugs and Terrorist Financing: HSBC Case History,
disclosed that two Bangladesh-based banks, Islami Bank
Bangladesh Limited (IBBL) and Social Islami Bank Limited
(SIBL) were involved in terror financing. Regarding the
functioning of HSBC, it was mentioned that the bank acted
as a financier to clients seeking to route funds from
countries like Mexico, Iran, Saudi Arabia, Syria, North
Korea, Cuba, Sudan, Myanmar, Japan and Russia. The report
also stated that the HSBC supplied dollars to IBBL and
SIBL, ignoring evidence of their links to terror financing.
HSBC did not submit these two banks to enhanced monitoring
for suspicious transactions, despite recommendation by
HSBC’s own Financial Intelligence Group (FIG).
According
to the document, SIBL’s ownership stakes were held by
two Saudi Arabia based non-governmental organizations
(NGOs): the International Islamic Relief Organization
(IIRO) - implicated in terrorist financing by the U.S.
administration and included on the list of those prohibited
to do business in the country; and Lajnat-al-Birr-al-Islam
(Benevolence International Foundation, BIF), one of al
Qaeda’s financers.
It was
noted, further, that Saudi Arabia’s Al Rajhi Bank, also
engaged in suspicious transaction, had a 37 per cent ownership
in IBBL. HSBC also had maintained an association with
Al Rajhi, a member of al Qaeda’s “Golden Chain” – a list
including at least 20 top Saudi and Gulf States’ financial
sponsors of al Qaeda, including bankers, businessmen,
and former ministers.
The U.S.
report on terror financing was not a recent finding. Since
9/11, the U.S. has taken strong steps to halt the flow
of funds to terrorist organizations under Executive Order
13224 and related elements of the USA Patriotic Act.
The exposure
of the unholy nexus between banking establishments and
terrorist activities in Bangladesh can be traced back
to the watershed country-wide serial bomb blasts on August
17, 2005. 459 explosions had been orchestrated in 63 of
the country’s 64 Districts (excluding Munshiganj), killing
three persons and injuring 100 others, on that date. After
the serial blasts, which were orchestrated by the Jamaat
ul-Mujahideen Bangladesh (JMB),
the role of IBBL in promoting religious terror was brought
under scrutiny, when Bangladesh Home Ministry constituted
a committee to investigate terror financing. Subsequent
to the arrest of the JMB ‘chief’ Shaikh Abdur Rahman and
his second in command Siddiqui Islam alias Bangla
Bhai, and the subsequent seizure of some banking documents,
the investigation team documented suspicious transactions
with IBBL branches in Sylhet, Gazipur and Savar, where
violations of the Anti-Money Laundering Act were noticed.
The Act which came into existence in 2002 was last amended
on June 20, 2011. Rahman and Bangla Bhai were also found
to have accounts with IBBL. The two were eventually hanged
on March 30, 2007 – Rahman in Comilla Jail and Bangla
Bhai in Mymensingh Prison.
IBBL was
also found to be linked with the Kuwait based Islamic
NGO, Revival of Islamic Heritage Society (RIHS), whose
bank accounts in Pakistan were closed following 9/11.
In Bangladesh, RIHS’s account with IBBL was closed in
2006, following revelations that, in November 2005, RIHS
released BDT 20 million to facilitate suicide bombers
in Bangladesh. Incidentally, Bangladesh experienced a
suicide bombing on December 8, 2005, in Netrokona District,
in which eight persons were killed and 46 were injured.
In addition, two officials of RIHS, one from Sudan and
the other from Yemen, were deported in 2006 for having
channeled from Bangladesh over USD 700,000 to local and
foreign terrorist organisations. Apart from the RIHS connection,
linkages were also discovered to Yassin Qadi, a Saudi
Arabian businessman and son-in-law of Sheikh Ahmed Salah
Jamjoom, a foreign sponsor of IBBL. IBBL is also believed
to have been closely tied to the August 17, 2005, serial
bombings across Bangladesh.
Interestingly,
Tarique Rahman, the son of Khaleda Zia (Chairperson of
Bangladesh Nationalist Party, BNP and then Prime Minister),
and the former vice-president of BNP, was also believed
to be involved in suspicious money laundering operations.
Reports indicate that Rahman and his associate Giasuddin
al-Mamun, Managing Director of Channel-1 Television, were
involved in money laundering, with Rahman linked forward
to Dawood Ibrahim, the principal accused and fugitive
in the March 12, 1993, serial blasts in Mumbai, India.
SIBL has
purportedly been engaged in Shariah (Islamic Law)
based banking in the country. Its Executive Vice President,
Shawkat Ali, was apprehended by Kolkata (West Bengal,
India) Police and was expelled from Kolkata in August
2006 for his involvement in undesirable and suspicious
activities. SIBL is suspected to be engaged in routing
funds to Kolkata, and from there to other destinations
in India and abroad. SIBL’s principal patrons are known
to be from the Middle East.
Investigation
of the financial operations of terrorist groupings such
as JMB and Harkat-ul-Jihad-al Islami Bangladesh (HuJI-B)
discovered that a major chunk of their funding came from
Pakistan through hawala (illegal money transaction)
channels. Terrorist organizations also received regular
funds from expatriate populations working in the US, Europe
and Middle East. A pro-Pakistani Political party – Jamaat-e-Islami
(JeI), Bangladesh, was found to be a frequent medium for
foreign funding. Funds were reportedly transferred into
JeI’s account with IBBL, and were then distributed to
various terrorist outfits in the country. JeI was a coalition
partner in Khaleda Zia’s Government.
Responding
to growing international pressure after 9/11, the Bangladesh
Government formed a central and regional taskforce on
January 27, 2002, to deal with money laundering and terrorist
finance. Subsequently, a Financial Intelligence Unit (FIU)
was also established in Bangladesh Bank on May 16, 2007.
A document titled National Strategy for Preventing
Money Laundering and Combating Financing of Terrorism
2011-2013, outlines the Government’s present strategy
to deal with the problem, and defines its mission, “To
bring the anti-money laundering/combating of financing
terror system and procedures of Bangladesh in full convergence
with international best practice standards set by FATF
and other multi-lateral forums”.
In November
2010, the National Coordination Committee, comprising
all agencies dealing with anti-money laundering and finance
related issues, was established. In addition, the Money
Laundering Prevention Act (MLPA), 2012, was promulgated,
repealing the Money Laundering Prevention Act, 2009. Similarly,
the Anti Terrorism (Amendment) Act, 2012, has been promulgated,
amending the Anti Terrorism Act, 2009, to meet international
standards and to establish an effective regime in Bangladesh
to deal with terror funding.
Unfortunately,
as recent revelations, including those by the US Senate
Subcommittee reiterate, such illegal activities continue
in Bangladesh. Despite a sharp decline in Islamist terrorism
related incidents and fatalities,
Islamist extremist mobilization and radicalization continue
in the country, and substantial flows of funds to groups
connected with terrorist continues. Some linkages between
Islamic Banking and terrorist organizations have now been
brought into the open, but the networks have not been
dismantled. In a country with a strong Islamist extremist
constituency, and an intricate web of collusive relations
with major political formations, as well as with significant
financial organizations, potent clusters of a residual
threat continue to exist. The Sheikh Hasina Government
has taken dramatic steps to target and neutralize these
subversive networks, with significant success. There is,
however, a long struggle ahead before the threat is fully
neutralized.
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KP:
Complicit Murders
Tushar Ranjan Mohanty
Research Associate, Institute for Conflict Management
While hearing the suo motu notice
on the recovery of dead bodies stuffed in gunny bags in
Peshawar, the provincial capital of Khyber Pakhtunkhwa
(KP), and its suburbs, the Peshawar High Court, on November
6, 2012, directed the KP Police to track down the people
responsible for dumping bodies by December 18, 2012. A
two-member bench, comprising Chief Justice Dost Muhammad
Khan and Justice Waqar Ahmad Seth, informed that so far
the Court had received post mortem reports of 26 recovered
corpses. It also reprimanded the Director General Health,
Sharif Khan, observing that doctors had filed forged autopsy
reports, giving starvation as the reason for most of these
deaths.
A report
about the cases had been prepared by the High Court’s
Human Rights Cell, which was later turned into a human
rights petition on August 16, 2012. The Peshawar High
Court on the same day took suo motu notice of the
incidents based on the report. The Chief Justice then
had stated that during the last one month 116 dead bodies
were recovered from different areas of the provincial
metropolis.
Earlier,
on October 30, 2012, a Bench of the Peshawar High Court
had sought an explanation from the Inter-Services Intelligence
(ISI) Director General, Lieutenant General Zaheer ul-Islam,
and KP Home Secretary Azam Khan, on the killing of Zahoorullah
Khan, allegedly in the custody of the enforcement agencies.
The Bench, comprising of the acting Chief Justice Miftah-ud-Din
Khan and Justice Waqar Ahmad Seth, asked the two to explain
under what law Zahoorullah Khan had been picked up and
under what circumstances he was killed. Zahoorullah Khan’s
father, Haji Mir Aslam Khan, had moved the Court, claiming
his son had been taken away by plainclothesmen accompanied
by the Police from his hujra (guest house) in the
Matani area of Peshawar on August 24, 2012. The father
submitted that after two months, the local Police handed
him body of his son for funeral.
Hearing
another case on the same day, the Bench directed the Station
House Officer (SHO) of Takht Bhai Police Station in Mardan
District to complete investigations into the killing of
Mohammad Riaz, whose father, Mohammad Ayub, had filed
a petition stating that his son went missing on June 1,
2011, from the Takhtbhai area. On June 27, 2012, his body
was recovered in the Haripur town of the same District.
Mohammad Ayub stated that his son’s neck was broken, his
body had marks of severe torture and was riddled with
bullet holes.
The problem
of torture and illegal executions, apparently by state
agencies, is compounded by frequent illegal detention
and rising numbers of ‘missing’ persons. Official documents
conceded that 676 persons had ‘disappeared’ in Pakistan
between January 1, 2011 and September 12, 2012. These
include 241 from KP; 244 from Punjab; 99 from Sindh; 48
from Balochistan; 27 from the Federally Administered Tribal
Areas (FATA); and 16 from ‘Azad Kashmir’. However, the
Supreme Court-appointed commission on missing persons
disclosed, on October 2, 2012, that the number of missing
persons during this period was significantly higher, at
852.
On October
22, 2012, the Peshawar High Court had directed the Federal
Ministry of Defence as well as the Federal Ministry of
Interior Affairs to submit replies with sworn affidavits
of senior officials in some 55 habeas corpus petitions
challenging the alleged illegal detention of the scores
of people by enforcement and intelligence agencies in
Peshawar (KP). The Bench, comprising of acting Chief Justice
Miftah-ud-Din Khan and Justice Waqar Ahmad Seth, directed
the representatives of the Federal and Provincial Governments
to make efforts to trace the missing persons. Significantly,
most of the habeas corpus petitions were filed
by women against the enforced disappearance, principally,
of their husbands or sons. In their petition they had
claimed that their cases had seen no progress over extended
periods of time.
Before
this, on October 4, 2012, the Court directed the Federal
Ministry of Defence as well as Federal Ministry of Interior
Affairs to provide the list of secret detention centres
run by the ISI, Military Intelligence (MI), Frontier Corps
(FC) and other agencies. The Bench stated that, under
the law, any detention centre run by the enforcement or
intelligence agencies that was not listed and notified
was illegal. The Bench observed that the intelligence
agencies pretended ignorance even after petitioners brought
evidence on record that the missing persons had been picked
up by or handed over to the personnel of these agencies.
The Bench passed the directives after both the ISI and
MI expressed their ignorance, in their affidavits, regarding
the whereabouts of the missing persons.
The complicity
of Government agencies in the unaccounted killings and
detentions is thus quite clear. On July 10, 2012, the
Peshawar High Court noted unambiguously:
As
a last resort, the Ministry of Defence is directed
to retrieve missing persons from the clutches of
the Military Intelligence otherwise the Court would
be constrained to take action under both the civil
and military law.
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Further,
on March 20, 2012, a Bench of the High Court had directed
the National Accountability Bureau, KP, to conduct an
inquiry against the SHO of Hayatabad Police Station in
Peshawar, Rajab Ali, suspected of being involved in extortion
from detainees kept at illegal detention facilities. In
one such case, in a petition filed on April 11, 2012,
Shamor Rehman, a businessman, claimed that the SHO detained
him at the Hayatabad Police Station and demanded PKR 600,000
for his release. He said that the SHO made him pay PKR
175,000, adding that his father had also paid PKR 200,000
to secure his release. Meanwhile, on April 10, 2012, the
Bench revealed that three illegal detention facilities,
allegedly run by the Rajab Ali had been discovered within
the jurisdiction of the Hayatabad Police Station. “The
illegal detention centres were used to extort money from
the detainees,” the Court observed. The SHO has now been
sent to the Police Lines under the Court’s directives.
During
its hearing on November 6, 2012, the KP Police told the
Peshawar High Court that they had registered cases against
‘unknown persons’ for the murders in the case of the recovery
of dead bodies in the Province, and had recorded statements
of the victims’ legal heirs. Additional Inspector General
(Investigation) Idrees Khan, however, argued, “Just one
person has alleged in his statement that the Armed Forces
are responsible for the murders.”
It is not
surprising, consequently, that the affected people, as
a last resort, are approaching the Courts in the hope
of some relief. The rise in such incidents only adds to
the misery that the Province is facing as a result of
terrorism and sectarian violence. According to partial
data compiled by the Institute for Conflict Management,
at least 11,782 persons, including 3,986 civilians, 1,465
SF personnel and 6,331 ‘militants’ have been killed in
terrorism-related incidents since 2005 (all data till
November 11, 2012). The number of fatalities for the current
year stands at 586.
These problems
of illegal detention and killings have also drawn the
attention of the international community. Concluding its
10-day visit to Pakistan on September 20, 2012, the UN
Working Group on Enforced or Involuntary Disappearances
(WGEID) acknowledged the incidents of enforced disappearances
across Pakistan, and recommended that the Government should
act to improve the situation at the earliest. The UN working
group urged the Government to set up an officially recognized
place of detention; to reinforce the commission of inquiry
to enable parallel hearings; to assist families to meet
the commission in the absence of members of the enforcement
agencies; to include the new crime of enforced disappearances
in criminal code; to ensure fair trial and punishment
for perpetrators; to suspend the perpetrators, including
army officers, from their official duties during the probe;
to ensure accountability of law enforcement agencies;
to train law enforcement and intelligence agencies in
the human rights field; to ensure protection of witnesses
and relatives of abducted persons; to provide financial
aid to relatives of missing persons; and to ratify the
convention for protection of all persons against enforced
disappearances.
There is
little hope of these ambitious demands being met in the
foreseeable future, given the fractured and flailing nature
of Governance across Pakistan. Indeed, whatever little
relief the affected individuals and families may receive
will only come from the aggressive interventions of the
Courts, even as the Army and its covert agencies, as well
as the Police, continue to use their considerable extra-constitutional
authority to stonewall the courts and evade accountability.
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Weekly Fatalities: Major
Conflicts in South Asia
November 5-11,
2012
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Civilians
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Security
Force Personnel
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Terrorists/Insurgents
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Total
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INDIA
|
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Arunachal
Pradesh
|
0
|
0
|
1
|
1
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Jammu and
Kashmir
|
0
|
0
|
4
|
4
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Manipur
|
0
|
0
|
1
|
1
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Meghalaya
|
2
|
0
|
1
|
3
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Nagaland
|
0
|
0
|
3
|
3
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Left-wing
Extremism
|
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Andhra Pradesh
|
1
|
0
|
0
|
1
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Chhattisgarh
|
0
|
1
|
1
|
2
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Jharkhand
|
4
|
3
|
0
|
7
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Total (INDIA)
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7
|
4
|
11
|
22
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PAKISTAN
|
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Balochistan
|
12
|
0
|
0
|
12
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FATA
|
6
|
1
|
12
|
19
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Khyber Pakhtunkhwa
|
6
|
6
|
3
|
15
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Punjab
|
4
|
0
|
0
|
4
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Sindh
|
58
|
5
|
10
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73
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Total (PAKISTAN)
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|
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Provisional
data compiled from English language media sources.
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BANGLADESH
BSF
submits list of militant camps to
BGB: The Border Security Force
(BSF) has submitted the names and
locations of the camps, of militants
of Northeast, in Bangladesh to Border
Guards of the Bangladesh (BGB during
a meeting between the BSF and BGB
held at Sylhet from November 5 to
8. BSF Public Relations Officer
(PRO), Ravi Gandhi, on November
9 said, "We have given them all
the details and they have assured
us of taking action against the
insurgents."
The Shillong Times,
November 10, 2012.
INDIA
Terrorist
outfits investing in Indian stock
markets, says UMHA Sushil Kumar
Shinde:Terrorist outfits are
investing in the Indian stock market
through spurious companies, Union
Minister of Home Affairs (UMHA),
Sushil Kumar Shinde said at an Interpol
General Assembly meeting in Rome
(Italy) on November 5. Shinde commented,
"Credible intelligence suggests
that terrorist outfits are investing
in stock markets through spurious
companies, setting up fictitious
businesses and laundering money".
The EconomicTimes,
November 6, 2012.
Kukis
threaten to resume armed struggle,
says report:The Kuki National
Organisation (KNO), an umbrella
organization of 16 Kuki outfits,
threatened to resume armed struggle
and secede from Manipur if the Centre
did not begin talks with them. However,
KNO leaders stressed they want a
solution within the Constitution's
framework. The seven-year-old Suspension
of Operations (SoO) agreement between
the KNO and the Government of India
ends on November 22. "If the government
does not begin talks with us before
November 22, we will be forced to
take up arms. Does the Government
of India want an armed rebellion?"
said Seilen Haokip, KNO spokesperson
in New Delhi. In 2005, KNO signed
the SoO with the Centre leading
to a ceasefire. Currently, KNO has
about 2,000 armed cadres.
Times of India,
November 3, 2012.
PAKISTAN
58
civilians and 10 SFs among 73 persons
killed during the week in Sindh:
At least 19 persons, including six
students of Deobandi School of thought,
were killed in separate incidents
of violence in Karachi, the provincial
capital of Sindh, on November 10.
Three
persons were killed in separate
acts of violence in Karachi on November
9.
Six
persons, including two Shia men
and a Policeman, were killed in
separate acts of violence in Karachi
on November 8.
At
least three Rangers personnel were
killed and 14 others injured in
a suicide attack outside the Sachal
Rangers Headquarters in North Nazimabad
Block B area of Karachi on November
8.
13
persons, including five Shia men,
were killed in separate incidents
of target killing in Karachi on
November 7.
15
persons, including three Bohra community
members, were killed in separate
incidents in Sindh on November 6.
Three
people, including two activists
of Muttahida Qaumi Movement (MQM),
were killed in separate incidents
of violence in Karachi on November
5. Daily
Times;
Dawn; The
News,
November
6-12, 2012.
UN
orders global sanction against Haqqani
network: The UN Security Council
on November 5 ordered global sanctions
against the Haqqani Network in Afghanistan
and its chief suicide attack organiser
Qari Zakir. Haqqani and Qari Zakir
were added to the UN's Afghanistan-Taliban
sanctions list. US put the Haqqani
network on its terror blacklist
in September 2012. The network has
been widely linked to Pakistan.
Dawn November
6, 2012.
Mullah
Fazlullah hiding in Afghanistan,
confirm US officials: According
to a report, the US officials have
confirmed that Mullah Fazlullah,
a 'commander' of the Tehreek-e-Taliban
Pakistan (TTP), is hiding in Afghanistan.
The report stated that the TTP leader
has escaped retribution by hiding
in a section of eastern Afghanistan
where the US forces are present
but focused on other targets. Tribune,
November 7, 2012.
CoAS
General Ashfaq Parvez Kayani warns
SC judges not to cross the limit
and undermine military: The
Chief of Army Staff (CoAS) General
Ashfaq Parvez Kayani on November
5 warning Supreme Court (SC) judges
said that that any effort to undermine
the military and "draw a wedge"
between it and its citizens would
not be tolerated. "Any effort which
wittingly or unwittingly draws a
wedge between the people and Armed
Forces of Pakistan undermines the
larger national interest," said
General Ashfaq Kayani. The SC Chief
Justice Mian Iftikhar Chaudhary
in October 2012 had ruled that the
military must stop interfering in
politics. Daily
Times, November
6, 2012.
Fuel
supply to NATO troops via Torkham
border check-post restored:
The supply of fuel to NATO troops
through the Torkham border post,
which lies in the Khyber Agency
of Federally Administered Tribal
Areas (FATA), resumed on November
7 after one year when two oil tankers
crossed into Afghanistan amid tight
security. The fuel supply remained
suspended despite resumption of
overall supplies in July 2012 after
the US apologised to the Government
over the killing of 24 Pakistani
soldiers in a NATO air strike on
the Salala checkpost in Mohmand
Agency on November 26, 2011.
Dawn, November
8, 2012.
The South
Asia Intelligence Review (SAIR) is a weekly service that
brings you regular data, assessments and news briefs on
terrorism, insurgencies and sub-conventional warfare, on
counter-terrorism responses and policies, as well as on
related economic, political, and social issues, in the South
Asian region.
SAIR is a project
of the Institute
for Conflict Management
and the
South
Asia Terrorism Portal.
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