Fake currency racket: Police fear Naxal-terrorist nexus

The circulation of fake currency notes is on the rise in Andhra Pradesh and what the police fear is the growing proximity between Naxals and terrorists. Vicky Nanjappa reports

The menace of fake currency is growing in India, more so with the involvement of Naxals. A recent investigation conducted by the Hyderabad police has revealed that those associated with the Naxal movement have been raising funds by circulating fake currency in Andhra Pradesh.

Hyderabad in particular has become the nerve centre of the fake currency racket. While earlier notes were smuggled into Andhra Pradesh, today notes are being printed and circulated within the state, say police sources.  

Nizamabad has been put under the scanner after the police busted an operation carried out by a local gang, which manufactured fake Indian currency. Further investigation pointed out that some members of the gang were associated with the Naxal movement.

According to the Nizamabad police, the fake currency racket has been operational on a small scale for months now. The gang has procured machinery to print out counterfeit currency and has been circulating notes in the denominations of Rs 500 and Rs 1000 in the local market.

Unlike the Dawood Ibrahim gang, which exchanged fake currency for original notes on roughly 2:1 ratio, the locals from Nizamabad exchanged notes on a 5:1 ratio.       

However, sources say that the fake notes were poor in quality compared to the currency racket, which involved Pakistan's Inter-Services Intelligence.

The police are now digging deeper to get to the roots of the counterfeit currency racket that has been funding Naxals. The presence of Naxal sympathisers is very high in Andhra Pradesh and the state continues to be one of the biggest markets for fake currency. Desperate for funds, the Naxalite movement today heavily depends on this racket for their operations, the police say. What they dread most the possibility of a nexus between Naxals and terrorists.

Two key Dawood operatives -- Aftab Bhakti, Babu Gaithan  -- are the masterminds of the currency racket in Andhra Pradesh. Originally from Hyderabad they are now based in Dubai. The police say that for years they have been smuggling fake currency into Andhra. But if they join hands with Naxal sympathizers it would provide a tremendous boost to this operation.

They Hyderabad police are conducting regular checks in the city as well as rural areas, where the Naxal movement is rooted. There is a need to keep a close watch on these developments before it snowballs into a bigger menace, the police said.