Fake money in Pak diplomatic baggage, on flights

Kathmandu: This is how easy is to cross the India-Nepal border: simply walk across. You can do this across the entire 1751-km-long border.

Driving along the India-Nepal border, one is struck by its openness and contiguity. Cross-border trade, legally is only allowed at one point of this border: the Rixaul-Birganj crossing. And that has made smuggling across the rest of the border an everyday activity.

At the Raxaul border crossing, Assistant Customs Commissioner Shaukat Ali says his men are on permanent vigil for fake currency couriers. “We are doing what we can,” says Ali.

In the remote border region of Belderwah, the Sashashtra Seema Bal camp in-charge says his men have choked the smuggling of fake currency. “There was smuggling but we have stopped it now. We patrol in the daytime and set up check posts at night,” says Inspector Ramesh Bhandari of the Sashashtra Seema Bal.

But on the Nepal side, officials admit that the sheer length of the porous border makes it almost impossible to police. “We cooperate with the Indian police. Whenever we are informed over the mobile phone or wireless, we take action but people are taking advantage of the porous border,” says Shivnath Yadav, Head Constable with the Nepal Border Police.

Babban Singh, an independent member of Nepal's Constituent Assembly, says Pakistan’s spy agency Inter-Services Intelligence (ISI) has bought the support of many government officials in Nepal. “Politicians and policemen are involved in fake currency. Otherwise how else can so much fake currency come in through Kathmandu,” says Babban.

Marked D for Dawood

Nepal's politicians and policy makers have a different description for fake currency. They call it the 'D' currency, all of which comes here at the Tribhuvan International Airport.

For the ISI and gangster Dawood Ibrahim's 'D' Company, Kathmandu is a crucial base in the financial terror campaign against India, and Kathmandu's Tribhuvan International Airport an important hub.

It is from the airport that fake notes enter Nepal, but their journey begins in Pakistan. The notes are first printed in ISI printing facilities in Multan and Quetta, on currency standard printing paper imported from London. Increasingly, the ISI is also using printing facilities in Bangladesh and Thailand.

The ISI transports the fake notes through the state-owned Pakistan International Airlines, or through the diplomatic route to Dubai, Kuala Lumpur, Hong Kong, Bangkok, Colombo and Dhaka.

From these locations ISI-backed couriers like, Azhar, bring consignments of fake currency on PIA flights to Kathmandu. From Kathmandu the notes are taken to Birganj. And from here they are pushed into India across the porous border through a vast network of couriers.

The Raxaul railway station is the biggest conduit for fake currency routed from Birganj. From here the notes travel to Patna, Kolkata, Delhi, Mumbai and Bangalore. Nepali law enforcement officials have also tracked two other routes through which fake currency enters India.

One is through Beherwa village on the Nepal border. From here couriers take fake currency consignments across the border to Suguali and then through rail to Gorakhpur, Lucknow, Delhi and Mumbai. The other route is from Birganj to Biratnagar on the Nepal border. From here fake notes make their way across the border to Darbhanga, Inerwa, Siliguri and Kolkata.

Nepalese intelligence sources say a hotel in Birganj is a key transit hub for the ISI's fake currency operations. ISI operatives in Kathmandu get Rs 500 for every Rs 1,000 of fake currency they give to dealers in Birganj.

These dealers in turn pay couriers Rs 500 for every consignment of one lakh rupees in fake currency across the border to Raxaul and other small border towns in Bihar. Buyers in India then buy the fake notes: Rs 700 rupees for Rs 1,000 rupees of fake currency.

India's National Security Advisor M K Narayanan has admitted that the government is aware of the ISI-'D' Company fake currency racket. “From the point of view of financial establishment the percent of fake Indian currency is not even a speck in terms of numbers. From the point of view of security establishment, I think it is a matter of concern because then it is used for purposes which are anti national,” says Narayanan.

But senior members of the Birganj Chambers of Commerce say they are surprised the Indian government is not doing more to counter the growing influence of the ISI in Nepal.

The Indian government acknowledges that fake currency is a grave threat, but it is unclear what it has asked Nepal to do to stop the racket.

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