Gems, Timber and Jiziya: Pakistan’s Taliban Harness Resources to Fund Jihad

Publication: Terrorism Monitor Volume: 7 Issue: 11

Swat Valley

The Taliban resurgence in Pakistan’s lawless provinces and its unhindered march towards the heartland of the restive country is fueled by an ever increasing economic life-line. Unlike Afghanistan’s Taliban, which depends on the poppy trade for revenues, the robustness of the Pakistan Taliban’s financial strength depends on a variety of sources, ranging from the timber trade, precious stone mining and now, the imposition of a religious/protection tax collected from minority religious communities.
The Islamabad administration has buckled under pressure from the Taliban, promulgating the Nizam-e-Adl (Islamic Jurisprudence) regulations in the Swat valley where the government has virtually lost control. The peace agreement gives the Taliban forces a massive opportunity to exploit the rich natural resources of Swat at will.
Before fighting broke out in Swat, one of the region’s main sources of revenue was a thriving tourist industry. Needless to say, there is no tourism in the region now and the Taliban have dismantled tourist resorts and tourism training facilities, auctioning off furniture, computers and building materials in Barabandai (The News [Islamabad], April 13).
The multiple sources of Taliban income make the Tehrik-i-Taliban Pakistan (TTP) a resilient and well-armed group with an agenda of turning Pakistan into an Islamic state.  Observers fear the wealth at the disposal of Taliban will enable them to sustain their jihad activities in Pakistan and beyond. 
The exploitation of northwest Pakistan’s natural resources for organizational revenues started in April 2008, when Taliban militants took over the Ziarat marble quarry, a white marble mine in the Mohmand tribal district. Before the arrival of the Taliban, Islamabad had planned to modernize the marble mines at Ziarat as part of an effort to increase marble and granite exports to $500 million per year by 2013. Roughly one million tons of marble are extracted from FATA every year (Daily Times [Lahore], July 20, 2008). Since the Taliban takeover, the quarry has brought the Taliban tens of thousands of dollars. Buoyed by this success, the TTP began eying the emerald deposits of Swat.

Emerald Mining

Arguably, the Taliban’s current strategy in the Swat region of Pakistan’s North-West Frontier Province (NWFP) is to exploit all resources available to them while the truce agreement with the Pakistan government is in force. Late in March, reports from the Swat valley emerged that the Taliban militants had taken control of government controlled emerald mines located in the mountains of Mingora. The occupation of the Mingora mine apparently took place sometime in February 2009, following the peace deal between the provincial administration and Sufi Muhammad, leader of the Tehrik-e-Nifaz-e-Shariat-e-Mohammadi (TNSM – Movement for the Enforcement of Islamic Law). Taliban forces then seized the nearby Shamozai and Gujjar Killi mines and initiated mining and trading processes on their own, employing a large number of local laborers. Locals are eager to work for the Taliban, who take one-third of the profits and distribute the rest to the workers.
The Gujjar Killi emerald mine in Shangla district (NWFP) was formerly leased to Luxury International, a US-based firm that abandoned operations when fighting began in the area. Nearly 70 Taliban militants occupied the mine after ousting government-appointed officials and employed local laborers on a profit sharing basis (Daily Times, April 2). Locals said the Taliban had decided to occupy Gujjar Killi when the government failed to take any action after the seizure of the Mingora mine (The News, April 2). Muslim Khan, spokesman for the Swat Taliban, justified the mining by saying that “all these minerals have been created by Allah for the benefit of his creatures” (Sunday Telegraph, April 4).
Mullah Fazlullah, the leader of the Swat-based Tehrik Taliban Swat (TTS), has been largely responsible for this economic activity in the NWFP. Fazlullah, the son-in-law of TNSM leader Sufi Muhammad, now controls these mining activities in Swat and adjoining places. According to one report, the gemstones are sold quickly at below market prices and smuggled to the Indian city of Jaipur (capital of Rajasthan) and thereafter transported to Bangkok, Switzerland and Israel (Sunday Telegraph, April 4). A BBC report indicated that emerald prices range from $1,000 to more than $100,000 for a cut stone, depending on the size and quality (BBC News, March 24).
Emerald mining and the international sale of gemstones through various channels provides much needed capital for the Taliban to capture other natural resources in the region. Most alarming is the possibility that the Taliban, which is largely immune to any offensive for now, could target other precious stone mines in the NWFP. Pink Topaz, Peridot, Aquamarine and Tourmaline are all available in abundance in different parts of the province. There are also reports that archaeological sites in the area are being looted, with the Taliban likely taking a cut of the proceeds, either as protection money or to encourage the continued instability that makes such looting possible (Dawn [Karachi], March 22). It is feared that the Taliban will use the money made from the excavation and sale of gemstones to finance more suicide attacks on NATO forces in neighboring Afghanistan and support Taliban expansion in Pakistan.
Timber Trade
Another lucrative source of income for the Taliban is Swat’s forests. The symbiotic tie between Taliban militants and the Timber mafia in Swat and nearby Dir is no secret. Large-scale illegal cutting of the region’s pine forests began simultaneously with the 2007 Taliban offensive in the area and the flight of most of the people living in the forests (Dawn, March 22). Taliban militants have been involved in the widespread cutting of the thick pine forests and apple orchards of Malam Jaba, Fatehpur, Miandam and Lalko, often in collusion with the mafia elements that cause enormous environmental damage to the region while making immense profits (The News, April 13).
The Taliban has long been in control of the timber trade in the NWFP and parts of the Federally Administered Tribal Areas (FATA). In mid-2008, Environment Minister Hamidullah Jan Afridi pointed towards the militant-criminal nexus in FATA and stated that the “timber mafia” has been responsible for funding militancy in the NWFP and in FATA (Daily Times, July 28, 2008). The enormity of the illegal exploitation of this state-owned natural resource can be determined by the statement of one government official: “The losses suffered by forests in the last year were more than the losses of the last two decades” (The National [Abu Dhabi], April 3).
The Jiziya Tax
Taliban financing efforts have reached the Orakzai Agency of FATA, situated close to Swat and Bajaur Agency, the site of heavy fighting between the Taliban and government forces in recent months. Taliban militants have demolished houses belonging to the minority Sikh community and confiscated their property in the Ferozkhel area of Orakzai Agency after they failed to pay the negotiated amount of 15 million rupees to the Taliban as jiziya—the poll tax levied on non-Muslim minorities living under Islamic rule as sanctioned by Shari’a. The houses were destroyed at the behest of Taliban commander Hakimullah Mahsud, the Taliban head in the Orakzai Agency and a close aide of TTP chief Baitullah Mahsud (The Nation [Islamabad], April 30). Earlier in April, Taliban militants demanded 50 million rupees a year as jiziya. To enforce their demands they held local Sikh leader Sardar Saiwang Singh captive and occupied a number of Sikh-owned houses (ANI, April 15; Daily Times, April 16).
Many Sikhs have decided to flee Swat, followed by members of the Hindu and Christian minorities (SamayLive, April 25). The situation for the Christian minority in Swat following the imposition of a Shari’a-based administration is not good and they are reportedly living in constant fear of the Taliban, even though the TTP’s Qari Abdullah is reported to have agreed to provide equal opportunities to the religious communities of Swat (Compass Direct News, March 31). Qari Abdullah’s pledges to protect minorities aside, pro-Taliban elements have attacked the Christian community in the Karachi neighborhood of Surjani Town. The violence began when pro-Taliban militants tried to prevent local Christians from removing graffiti on their church that demanded Christians convert to Islam or give jiziya, like the Sikhs in Orakzai (Daily Times, April 23; The News, April 23).
Surprisingly, the Islamabad administration has so far remained silent over the Taliban takeover of mines and the exploitation of forest resources. Pakistan is suffering the loss of 65 billion rupees annually from the illegal timber trade and indiscriminate deforestation alone. The plight of minority communities has been ignored by the government.

The brief military operation against a marauding Taliban in Buner and Lower Dir notwithstanding, the Pakistan government is largely reluctant to initiate any major offensive in Swat against TNSM-TTP militants there. Instead of addressing the exploitation of minorities and the indiscriminate looting of Swat’s resources, the central government seems prepared to go ahead with implementing Islamic law in the Swat region under the Nizam-e-Adl Regulations. The continuing decline in government authority in the region will give ample opportunity to the Taliban to organize an exploitative but functioning financial system.