Drug Business in India’s Gateway

Matthew Fishback is a senior studying International Relations at Appalachian State University in North Carolina, USA. His studies have focused on Latin America and security issues related to the illegal drug trade and narco-terrorism. This article focuses on the intersection of drug smuggling, militant, and terrorist organizations in India, along with the societal impacts of becoming a narco-economy.

The Indian state of Punjab concentrates a large Sikhi population and shares a sizeable portion of its border with Pakistan. Recently, it has been grabbing headlines in India for having become a significant drug use and trafficking hub. NGOs and activists claim that over 5.51 million households in Punjab, over two-thirds had at least one drug addict in the family. Furthermore, the Post Graduate Institute of Medical Education and Research found that 3.1 million Punjabis were dependent either on heroin, opium, cannabis or other narcotics [1]. Beyond the well-known health and economic impacts of drug addiction, India has been struggling to mitigate trafficking and terrorism-related activity in states bordering Pakistan, such as Punjab traditionally, but increasingly Himachal Pradesh, as well as Jammu and Kashmir (J&K). It has only been in the past three years the addiction epidemic has exploded in Punjab and neighboring states, setting off alarm bells at the national level. As evidence continues to emerge showing the links between organized crime, terror groups, and drug traffickers, Indian intelligence and security forces have been scrambling to implement new tactics. If the situation is not brought under control soon, India may face an increase in major security issues stemming from a porous border along with increasing health issues and economic decline among narco-economic states.

The Terrorism-Drug Nexus

On 14 February 2019, a suicide bomber in Pulwama (J&K) killed 40 security personnel riding on a bus. The Pakistan-based terrorist group Jaish-e-Mohammad (JeM) claimed responsibility for the attacks which was confirmed by India’s National Investigation Agency (NIA) [2]. The NIA also recently concluded that seven terror-related cases in Punjab between 2016 and 2017 which were aimed at reviving Khalistan, a Sikh separatist movement [3]. This has come as a shock to India’s intelligence community as it was thought that the JeM network had been sufficiently dismantled to the point where it was no longer a threat. Sikh separatists were also widely considered to have been brought under control by 1993.

Now, looking at the following two graphs, overall seizures of heroin and opium in India (in Kg) from 2002 to 2009 stayed fairly constant [Graph 1]. From 2014 to 2016, there was a sharp and steady increase in seizures [Graph 2]. A further study by the Indian Narcotics Control Bureau shows that the narcotics trade is back with full force in India, with street values in 2017 and 2018 at levels similar to the 1990s and early 2000s when many militant groups were desperate for funds [4]. In 2017 alone, 191 kilograms of heroin were seized in Punjab, a street value of 1.87 billion Rupees or 26 million USD.

The connections between various terrorist groups and drug trafficking organizations are widely acknowledged by intelligence organizations. Among others, the D-Company, Al-Qaeda, Lashkar-e-Taiba, and Indian Mujahedeen are all recognized as having significant amounts of funding from drug trade in India, typically originating from Afghanistan. In the past, the D-Company, named after Mumbai kingpin Dawood Ibrahim, has helped Jihadist terror groups in India by facilitating illegal border crossings and providing arms or money. The explosives used in the 1993 Mumbai terrorist attacks were thought to have been smuggled into India by the D-Company. Ultimately, border seizures of drugs and arms packaged together provided evidence of cooperation between the D-Company and anti-Indian elements [6]. Kashmiri, Sikh, and other militants have also used drug money to finance their terrorist operations, and according to one study “It is estimated that 15 percent of the finances of J&K militants were generated through the sale of drugs [7].” While it was true that many militant and terrorist organizations were funded by drug sales, especially Punjab’s Sikh separatists, those movements were brought under control by the early 2000s. Based on the available information, Indian security and intelligence groups have generally concluded that the uptick in drug smuggling is a lead up to renewed terrorist and militant activity.

Impact on Punjab’s population and economy

As of 2018, Delhi and Punjab have over 60 percent of households in the top quintile for total income. In Punjab specifically, the Jain community has 70 percent in the top income quintile, while the Sikhs follow with 59.6% [8]. Researchers noticed over time that drug sales have slowly replaced legitimate industry, agriculture, and business as the number of addicts grow in Punjab. Drug addicts, generally being unreliable workers, disrupt and eventually sink businesses or agricultural ventures. After losing legitimate work, users turn to other methods of income such as drug dealing or theft. It can be assumed that some of the richest in Punjab are not making money through legitimate means, and instead drug dealers are getting rich by turning their state into a narco-economy. As consumption increases, dysfunctional behaviors create law and order problems while simultaneously causing a massive economic drain. The state decreases production and increases security expenditures [9]. Adding to the overall societal cost of the drug trade, the lure of money has attracted and corrupted many state institutions. More than 100 employees of the Punjab police and other security forces have been arrested since 2014 due to their involvement in the drug trade [10][11]. Senior police officers also said that, “efforts to contain the flow of drugs into Punjab were further hampered by the patronage provided to smugglers by state politicians and police officials…[12]” Over time, as Punjab and surrounding trafficking hubs transition from distributor to user economies, whatever remains of a legitimate economy will continue to collapse due to rampant corruption and societal disruption without serious outside intervention.


[1] https://www.telegraph.co.uk/news/2018/07/09/drugs-crisis-indian-state-deadly-15-years-terrorism-government/


[3] https://economictimes.indiatimes.com/articleshow/67958238.cms

[4] https://www.indiatoday.in/india/story/synthetic-drugs-push-indias-narcotics-market-to-a-high-1113532-2017-12-21

[Graph 2][5] https://qz.com/india/905477/drug-data-ganja-ganja-everywhere-but-indias-getting-high-on-a-lot-more/

[6] https://idsa.in/system/files/OP_DrugTraffickinginIndia.pdf

[7] Ibid.

[8] https://www.indiatoday.in/education-today/gk-current-affairs/story/delhi-punjab-are-richest-states-all-about-the-latest-wealth-index-1145618-2018-01-15

[9]  https://idsa.in/system/files/OP_DrugTraffickinginIndia.pdf

[10] https://www.bbc.com/news/world-asia-india-46218646

[11] https://www.tandfonline.com/doi/full/10.1080/09592318.2012.642204

[12] https://www.telegraph.co.uk/news/2018/07/09/drugs-crisis-indian-state-deadly-15-years-terrorism-government/

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