Oil smuggling in Balochistan represents a significant concern that poses serious economic, environmental, and security threats. In the vast region of Balochistan, the illegal oil trade not only makes the state bear the financial losses but also provides crucial funding for terrorist organizations like BLA, BLF, and TTP to organize their criminal network.
The extensive and porous border with Iran is crucial in facilitating oil smuggling. The Iranian oil, which is comparatively cheaper and heavily subsidized than the legal imports in Pakistan is transported across the border in substantial volumes. Reports indicate that around 2.8 million liters of oil are illegally brought into Pakistan, leading to an estimated revenue loss of 227 billion rupees (around 816$ million). This illegal trade has given rise to a black market that not only weakens Pakistan’s formal energy sector but also enriches criminal networks and insurgent groups.
The relationship between oil smuggling and the financing of terrorism is deeply concerning. Insurgent groups such as the Balochistan Liberation Army (BLA) and Tehreek-e-Taliban Pakistan (TTP) utilize the financial gains from smuggling to support their militant activities. These terrorist organizations depend on these funds to acquire arms, train personnel and carry out devastating attacks to create instability in the province. For instance, BLA targeted foreign investment and critical infrastructure, particularly those related to the China-Pakistan Economic Corridor (CPEC). A significant attack took place in 2024, in which BLA attacked a train station resulting in 2024 deaths and more than 40 injuries.
The consequences of smuggling are not limited to the economy but have far-reaching effects that one can comprehend. It undermines legitimate businesses, discourages foreign investment, and diminishes public trust in state institutions. Moreover, the environmental repercussions are also significant. Smuggled oil does not meet the criteria of quality regulations, leading to pollution and health risks. The unregulated movement of oil also heightens the likelihood of spills and accidents, resulting in lasting ecological harm.
International conventions and agreements provide the necessary framework to combat smuggling and disrupt the financing of terrorism. The United Nations Conventions Against Transnational Organized Crime (UNTOC), which was adopted in 2000, established a global framework to combat transnational organized crimes such as smuggling. Its protocol highlights the importance of sharing intelligence and a collaborative approach to tackle these issues. Similarly, the Financial Action Task Force (FATF) holds a significant position in the battle against terror financing. Through the formulation of anti-money laundering (AML) and combating the financing of terrorism (CFT), the FATF provides guidance to countries in highlighting and dismantling financial networks that facilitate terrorist activities.
Pakistan, being a signatory to these conventions has initiated efforts to tackle the challenges related to financial terrorism. The Pakistan Army now adopted more stringent control border measures, which include a one-document regime that requires all individuals to present proper documentation for border transit. These efforts have provoked smugglers and terrorist organizations who are involved in these transnational organized crimes notably the Baloch Liberation Army (BLA).
The recent enforcement actions pose a significant risk to their source of income, leading to pushback from affected parties. Smugglers and affiliates of the BLA have mobilized protests in response to the stricter security protocols, portraying these measures as an infringement on the economic well-being of border communities. Notably, protests occurred at the Chaman border, where participants obstructed roadways and interrupted regular activities, demanding the withdrawal of the newly implemented policies.
Mahrang Baloch, and Mehran Marri who is the head of the United Baloch Army, a militant organization support this illegal smuggling. While they accuse Pakistan of arms trading, they have been linked to these organized crimes and misusing BLA’s funds. Moreover, Maulana Hidayat ur Rehman an MPA from Gawadar criticized security forces for allegedly extorting money from coal trucks and diesel shipments. However, the reality is that these smuggling networks provide logistical support to terrorists. Whenever actions are taken against them, figures like Maulana Hidayat ur Rehman organize protests to disrupt these efforts.
Maulana also criticized the Coast Guards, but these same forces are a significant obstacle to smuggling and illegal activities in Balochistan. Smuggling funds terrorism and Maulana’s criticism reflects his discomfort with the Coast Guards’ operations against these networks.
Although challenges persist, the recent enforcement action is a pivotal step in eradicating the relationship between smuggling and terrorism. . By aligning security efforts with socio-economic development, Pakistan is effectively dismantling the financial networks that underpin smuggling and insurgency, thus paving the way for increased stability in the region.
