Tobacco.org

• The Taliban and Tobacco 

As government sanctions restrict traditional sources of terrorist financing, Pakistani militant groups increasingly rely on proceeds from counterfeit cigarette production and smuggling, intelligence sources say. Although income figures are rough estimates at best, profits from the illicit cigarette trade account for as much as 20 percent of funding for these militant groups, second only to heroin production, according to terrorism experts in Pakistan. "Taliban and other militant groups do not have to do much," says Ikram Sehgal, a senior defense and security analyst who heads SMS Security, Pakistan's leading private security company. "They simply receive taxes on a regular basis from owners of illegal and legal cigarette factories and later for the safe passage they provide to the convoys."

Sahib Ayub Afridi: local philanthropist, convicted drug smuggler, and top cigarette counterfeiter in Pakistan.The Afridi case is part of a broader trend of terrorism groups relying on contraband to finance their activities, experts say. Even if efforts to cut the region's booming heroin production are successful -- an unlikely prospect -- the lucrative tobacco trade suggests how hard it will be to stanch funding to terrorists and insurgents in areas far from government control. The world's longest-running civil wars are fueled by contraband according to a 2002 study by Stanford University's James Fearon. Cocaine smuggling has largely propelled FARC's 40-year insurgency in Colombia. Diamonds have funded civil wars in Sierra Leone and Angola. Opium has led to drawn-out conflicts in Afghanistan and Burma.

In the badlands of the Afghan-Pakistan border, the challenges are particularly daunting.

Jump to full article »