As analysts and media persons scout around for ‘breaking news’ on the visit of US President Donald Trump, the focus has been on trade and possible defence deals. While both are important issues in assessing Indo-US ties, what is often missed is the quiet cooperation in sensitive areas crucial to the security of both. Two recent instances are illustrative. In January this year, five men were indicted in the US for operating an international procurement racket that serviced at least two Pakistani government entities considered a threat to US national security. Even more recently, Indian customs officials detained a Chinese ship bound for Karachi, carrying dual-use equipment. That means it could be destined for either civilian use or military purposes.
Both these developments come at a time when the Financial Action Task Force (FATF) plenary meeting in Paris is to decide whether Pakistan will remain on the ‘Grey List’ in terms of risks to the international financial system. The assessment is not limited to terror finance alone. The FATF also concerns itself with the financing of proliferation of weapons of mass destruction, and on this parameter, Pakistan is only ‘partially compliant’, at a time when rumours of Turkey-Pakistani nuclear cooperation are resurfacing.
The US crackdown
The proliferation ring unearthed by US officials seemed to have been operating through front companies in Hong Kong, Canada, the UK and the US. Of the five indicted, one is a resident of Pakistan, two are from Canada and one each from Hong Kong and the UK. Three others linked to the case are Pakistani citizens.
The network seems to have been a family concern, run by a man named Md Kamran Wali. The group supplied the Advanced Engineering Research Organisation (AERO) and the Pakistan Atomic Energy Commission (PAEC) with goods that they could not legally procure as sanctioned entities.
The modus operandi was fairly simple. Kamran’s offices in Rawalpindi, Karachi (in Defence Housing Authority) and at an upmarket address in Islamabad, received the orders, which was then passed on to front companies outside Pakistan for sourcing. The listing provided by the District Court, New Hampshire, describes the set-up as a far-flung enterprise, sourcing satellite communication systems and emulators.
According to data from Wikileaks, a group of US officials who earlier visited its office in Wah found that it was co-located inside the top-secret Air Weapons Complex — an establishment that designs all airborne platforms for the Pakistani Air Force, including for its newest thrust area, the armed unmanned aerial vehicle. AERO is staffed by retired Air Force officers, who in this instance, were looking for technology to replace defective Chinese equipment. Put into the Entity List of the US Commerce Department in 2014, AERO has now come again into the limelight, for not just violating US laws, but also as a potential threat to the “delicate balance of power among nations within the region.”
AERO was supplying something that would have adversely affected India’s security. The most probable thrust of AERO’s present illicit exercise could be related to its race to hone its Armed UAV capability, which is fast-emerging as the chosen weapon for low-intensity warfare. With the armed UAV capability, there would be no need for that expensive, and potentially difficult to justify air raid, when a Long Endurance UAV can slip in and deliver a lethal strike against probable targets like India.
Whatever equipment it was, it was certainly something the Pakistanis could not get from China in spite of their close defence relationship.
A third company is also mentioned. The Heavy Mechanical Complex (HMC), Taxila, wanted Electro-Magnetic and Radio Frequency shielding, which was shown on paper as destined for MRI rooms in hospitals. The HMC was transferred to the Special Projects Division and the PAEC in 2016. While the whole case may have merited only a few pages of print space, it is one that would have involved months of patient intelligence gathering. This is intelligence cooperation at its best.
India comes into act
The second incident involves the detention of a Chinese ship by Indian authorities based on a tip-off from an unknown source. The vessel seems to have originated from Shanghai and then went on to ports in China’s Jiangsu province, before arriving at Kandla. Officials found that the vessel was carrying autoclaves, a pressure chamber with dual-use implications. In the 1980s, Pakistan was trying to source this from South Africa, as part of the ‘AQ Khan proliferation network’.
The seizure shows India has made great progress when it comes to tracking ships with the use of technologies like the Automatic Identification Systems (AIS), which operates in partnership with some 29 countries. This involves exchange of information on the safety and movement of commercial shipping. It also includes the setting up of coastal radars in Sri Lanka, the Maldives and Seychelles. This increased maritime domain awareness is vital in terms of the US-India ‘Indo-Pacific’ construct when dealing with diverse common threats in the region.
These developments highlight two issues. The first is that the Weapons of Mass Destruction Proliferation is well alive and that while the FATF does excellent work on curbing terrorist finance, its chair — who happens to be China — is not in compliance with its own norms. Second, new versions of Pakistan’s ‘AQ Khan network’ are again operating, probably to the benefit of both Pakistan and China.
Neither of these two issues has ever been fully acknowledged by non-proliferation supporters raging at Iran or North Korea. But, times have changed. As President Trump arrives, it’s all to the good that the Indo-Pacific construct is to now stretched from “California to Kilimanjaro”, a phrase coined by Deputy National Security Advisor Matthew Pottinger to flesh out an Indian need. But ‘strategic convergence’ will remain mere verbiage, unless both partners are able to deal with this dangerous illicit trade that threatens their core security calculations.
The author is former director, National Security Council Secretariat. Views are personal.