GOVERNMENT OF INDIA
Ministry of Home Affairs
UNSTARRED QUESTION NO 2481
TO BE ANSWERED ON 21.03.2007
Foreign Investment by Terrorists
SHRI RAJEEV CHANDRASEKHAR
Will the Minister of HOME AFFAIRS be pleased to state:-
(a) whether the Ministry of Home Affairs is aware of the NSA`s recent statement regarding use of foreign investments and equity stock markets by terrorists/anti national elements;
(b) if so, what steps the Ministry is taking in this regard;
(c) whether there is any coordination between Home and other Ministries like Finance, Civil Aviation, Ports and Telecom, which are the administrative Ministries of national security sensitive sectors; and
(d) whether there is any coherent and consistent approach from national security point relating to foreign investment and ownership, that covers all these sectors and Ministries; if so, the details thereof?
MINISTER OF STATE IN THE MINISTRY OF HOME AFFAIRS
(SHRI SRIPRAKASH JAISWAL)
(a): As per available reports, terrorists and terrorist organizations active in India are using different channels to fund their operations.
(b):The Unlawful Activities (Prevention) Act, 1967 as amended in September, 2004 has provisions to combat financing of terrorism. The Foreign Contribution (Regulation) Act, 1976, (FCRA), also regulates and monitors receipt and use of foreign funds by the recipients. The Foreign Exchange Management Act, (FEMA) has provisions to deal with the cases of unauthorized transfer of foreign exchange including through hawala. Further, the Prevention of Money Laundering Act and the Financial Intelligence Unit (FIU-IND) have also come into effect.
The security and law enforcement and Revenue agencies are sensitized from time to time to pursue an inter-agency approach to detect channels and use of funds received by terrorist groups.
At the international level, India is a member of Asia Pacific Group (APG) on Anti-Money Laundering and Combating of Financing of Terrorism and has Observer status in the Financial Action Task Force (FATF).
(c) & (d): There is continuous coordination between Home, Defense, Finance and other Ministries, which are the administrative Ministries of security sensitive sectors. Proposals relating to such sectors are referred to the Ministry of Home Affairs and Ministry of Defense for vetting from security angle.