The door was opened by an English butler called Terry, dressed in perfectly creased pinstriped trousers and dark suit—a gesture of magnificent professional disdain of the sweltering Arabian sun. The manservant’s costume didn’t change to suit the set: The Emirates Hill mansion in Dubai, set around a sprawling courtyard with a fountain at its centre; the opulent apartment in London’s plush South Kensington; the five-bedroom, 154-foot yacht Raasta, its art-deco interiors carved from teak.
Ensconced in a lounge studded with art from across the Middle-East and South Asia, the new wife of Imran Khan glumly awaited the women-only gathering that lay ahead. “I groaned at the prospect of spending my afternoon with more silicone dolls,” Reham Khan recalled.
“Baby, they are very important,” the future prime minister of Pakistan remonstrated. “Arif Naqvi funded 66% of my campaign in 2013 himself.”
Fighting extradition to the United States, where he faces a 291-year sentence for financial fraud, Naqvi now finds himself at the centre of a storm over his role in financing the rise of Imran Khan’s Pakistan Tehreek-e-Insaaf (PTI). Explosive allegations have surfaced that Naqvi made the payments on instructions of former Inter-Services Intelligence (ISI) director-general Lieutenant-General Ahmad Shuja Pasha.
Legal filings by United States prosecutors allege Naqvi falsified documentation to cover up losses, and misappropriated at least $400 million from investors like the Bill and Melinda Gates Foundation, meant to finance healthcare for the poor in developing countries.
A part of that money, new evidence suggests, was used in a military-led plot to overthrow Pakistan’s political order.
Also read: Major financial scandal awaits Imran Khan? Follow Pakistan businessman Arif Naqvi’s money
The Generals and Imran
The story goes back to the summer of 2008, when prime minister Yousaf Raza Gillani’s government moved to impose civilian control over the ISI. The move, aimed at deepening détente with India and pushing the ISI to act against anti-United States jihadists, backfired. Former CIA officer Bruce Riedel has said that the ISI undermined the civilian peace bid by staging 26/11. Following the United States raid which led to the killing of al-Qaeda chief Osama bin Laden, civilian-military relations deteriorated further.
The Generals needed a trustworthy political partner. With a platform of seeking talks with Taliban jihadists, greater Islamisation and a hawkish position on Kashmir, Imran had the right ideological credentials.
Facing growing questions, Imran publicly denied reports of ISI funding in 2012. The evidence was mounting up, though. The military, Frédéric Grare has observed, launched a bloodless coup to help him in December, 2012, by facilitating mass protests against the government.
Imran’s 2013 election bid failed—but the new government of prime minister Nawaz Sharif also found itself mired in conflict with the army. Fresh protests led by Imran again paralysed the government in 2014. New ISI chief Lieutenant-General Zaheer-ul-Islam, Nawaz Sharif has claimed, threatened to mount a coup unless the prime minister resigned to make way for Imran,
Lieutenant-General Rizwan Akhtar was appointed ISI chief in 2014, in a bid to calm the tensions between the government and the army. Through Generals, though, nursed their unfinished business.
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The empire behind Imran
Earlier this year, Naqvi had submitted an affidavit to the Election Commission of Pakistan admitting that he raised $2.1 million for Imran in 2013—just the time the Generals were plotting his rise. Election laws in Pakistan prohibit foreign donations to political parties, but Naqvi asserted he raised the money from Pakistani nationals. Wootton Cricket, the Cayman Islands-registered company through which the money was paid, served only “as a convenient and traceable aggregator of funds.”
Last week, though, journalist and author Simon Clark revealed that bank records showed that $1.3 million paid to Imran’s party in March 2013 came from Naqvi’s Abraaj Investment Management. Abraaj later expensed the donation to the holding company through which it controlled power supply firm Karachi Electric.
Another $2 million, documents show, came to Wootton from United Arab Emirates (UAE) minister Sheikh Nahyan bin Mubarak al-Nahyan.
Imran Khan has admitted receiving funds from Naqvi, but says they were routine political donations. There has been no explanation of why the businessman and the Sheikh made these investments in his political fortunes.
Last year, an investigation by Margot Gibbs and Malia Pulitzer revealed several key members of Imran’s inner circle—including ministers Shaukat Tareen, Chaudhry Moonis Elahi and Makhdum Khusro Bakhtyar—held millions of dollars in offshore trusts and companies. Tariq Shafi, a leading PTI donor, was found to have $215 million in offshore accounts.
For his part, General Pasha was appointed advisor to the UAE after his retirement in 2012. From 2016, he began working as a consultant for WAK Group. The company, owned by politician-tycoon Waqar Ahmad Khan, is alleged to have profited from gas quotas awarded without open bidding. WAK was also held by British courts to have defaulted on loans to develop a 1.5 acre London property into a mansion with 21 bedrooms, a basement, swimming pool, a cinema, a sauna and orangery.
Also read: Why Imran Khan blamed the US for his downfall and not Pakistan army
The electric man
Educated at the Karachi Grammar School and the London School of Economics, Naqvi had leveraged his education to escape a toxic milieu where success depended on connections and corruption. In 1982, he married Fayeeza Chundrigar, a descendant of Ibrahim Ismail Chundrigar, the tycoon who briefly served as Pakistan’s prime minister for 55 days in 1957. Following a successful career at several major banks, he moved to the UAE and set up Abraaj. At its peak, Abraaj held assets of $13.6 billion in six continents.
The Naqvis counted Hilary and Bill Clinton, Barack Obama and Bill Gates among their friends. They donated to top universities and prestigious charities. Then, he bet big on building a swamp called Karachi Electric.
Ever since the 1950s, Karachi’s electric supply system had slowly disintegrated. While consumers disdained to pay their bills, governments under-invested in infrastructure. In 2005, the government offered Karachi Electric to Abraaj for a token $1. Finally, a Saudi-Kuwait consortium acquired 71 per cent of Karachi Electric’s shares.
The consortium soon learned it had made a mistake. In 2008—on the back of Karachi-wide blackout caused by industrial action—Naqvi was again asked to take over. This time, he agreed. Friends in Washington helped out, pushing through a $7.5bn aid package that would have helped power sector reform in Pakistan.
Farrukh Abbas, related through his wife to then-president Zardari, was hired to lead Abraaj in Pakistan. The president’s privatisation of Karachi Electric, though, ran into opposition from within his own party. In 2011, Abraaj’s decision to sack 4,300 workers led to violence, allegedly instigated by powerful ruling-party politicians.
Likely, the unhappy experience with Zardari had something to do with Naqvi’s support for Imran.
Faced with a mountain of unpaid bills from government customers—and a growing pile of debt to its own energy suppliers—Karachi Electric struggled. The solution emerged from President Xi Jinping. Shanghai Electric, one of China’s biggest power companies, stepped in with a $1.7 billion offer to take Karachi Electric off Naqvi’s hands.
In the summer of 2016, Simon Clark and Will Louch have written in an authoritative book on the Abraaj story, Naqvi drew up a $20 million contract with a middleman, to gain prime minister Nawaz Sharif’s backing. The prime minister, though, was forced out of office by a Supreme Court judgment in 2017, which held him guilty of corruption.
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The end of the dream
Imran Khan finally came to power in 2018, installed in office, scholar C. Christine Fair has recorded, facilitated by the army. Facing financial pressures because of investments gone bad, Naqvi needed the Karachi Electric sale to go through. Federal Investigation Agency (FIA) director-general Bashir Memon stood in the way. Abraaj owed Pakistan’s state-owned gas company Pakistani Rs 87 billion. In response to the demands for payment, Memon later said, Karachi Electric would threaten to shut down power to the city—and secure a reprieve.
Imran ordered Memon to close the case. The FIA chief refused, leading to his unceremonious transfer. Talks to sell Karachi Electric remain stalled, among disputes over how much it is owed by the Pakistan government, the scale of its debts and future power-pricing.
To help Naqvi, Imran also threw his weight behind plans to create a sovereign wealth trust, Sarmaya-e-Pakistan, which would control the country’s public-sector assets. Abraaj hoped for a major share in the trust’s operations, in which former employees were to have key roles.
Forensic examination of Abraaj’s affairs aborted Imran’s efforts to bail Naqvi out. Naqvi was held at Heathrow Airport in early 2019. Like fugitive diamond merchant Nirav Modi, Naqvi is fighting extradition on mental health grounds. The two cases will likely be decided together.
Even though prime minister Shehbaz Sharif and the ruling alliance of Pakistan Muslim League-Nawaz and Pakistan People’s Party have used the Naqvi revelations to assail Imran, no criminal investigation has been ordered. The Election Commission of Pakistan has held that Imran Khan received prohibited funds, but its investigation does not touch on the sources and their motives. The hold of cronyism on Pakistan’s politics is too deep—and the Generals involved too powerful—for the full truth to be told.
The author is National Security Editor, ThePrint. He tweets @praveenswami. Views are personal.
(Edited by Prashant)