Financial Superstitions: Hawala accusations and boundary-making in Kashmir
Saraf, Aditi
(2022) Economy and Society, volume 51, issue 3, pp. 514 - 533
(Article)
Abstract
Trust-based informal credit forms an important basis for capital and commodity circulation in the bazaars of South Asia, comprising promissory payments settled according to vernacular timelines and practices. These systems are also regarded with acute suspicion outside their networks of circulation. In Indian-administered Kashmir, this suspicion acquires another layer due
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to associations of informal credit with putatively illegal hawala transactions, viewed by the state as channels for ‘black money’ that fund anti-state protests and militant activities. I set trust-based credit practices alongside national controversies around hawala in India to examine how and when such informal credit transgresses boundaries between licit and illicit domains. By studying legal pronouncements, national ‘scandals’, the rhetoric around demonetization and the experience of traders operating amid political violence in Kashmir, I trace how hawala becomes criminalized and how the indeterminacies of informal credit are exploited by the state to enforce spatio-political rather than financial boundaries.
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Keywords: informality, trade, statecraft, law, borders, Kashmir, General Social Sciences, Economics and Econometrics, History, SDG 16 - Peace, Justice and Strong Institutions, SDG 11 - Sustainable Cities and Communities
ISSN: 0308-5147
Publisher: Routledge
Note: Funding Information: I am grateful to everyone in Kashmir and Delhi who helped with conducting this research, and especially to my interlocutors from the trading community in Kashmir for their time and generosity. This paper grew out of a paper developed for a workshop on cash and cashlessness. I thank the conveners Atreyee Sen, Camilla Ida Ravnbøl and Marie Kollig for inviting me to present my work. The workshop was part of the research project ‘“After money, what is debt?”: Indebted urban poor households in emerging cashless economies’ led by Atreyee Sen at the University of Copenhagen and funded by Independent Research Fund Denmark. The paper benefited from suggestions and comments from the anonymous reviewers and the editors at Economy and Society, my thanks to them and to Dawn Bailey for their patience and support. For helpful insights and generous engagement with various questions and versions, I thank Ajay Gandhi, Atreyee Sen, Ishani Saraf, Jason Cons, Megha Sehdev, Pernille Hohnen, Raheel Khursheed, Renu Kohli, Sarah Tobin and Yathukalan Yogarajah. All shortcomings and errors are mine. Funding Information: was received from the Social Sciences Research Council, The Wenner Gren Foundation and the European Research Council. I am grateful to everyone in Kashmir and Delhi who helped with conducting this research, and especially to my interlocutors from the trading community in Kashmir for their time and generosity. This paper grew out of a paper developed for a workshop on cash and cashlessness. I thank the conveners Atreyee Sen, Camilla Ida Ravnbøl and Marie Kollig for inviting me to present my work. The workshop was part of the research project ‘“After money, what is debt?”: Indebted urban poor households in emerging cashless economies’ led by Atreyee Sen at the University of Copenhagen and funded by Independent Research Fund Denmark. The paper benefited from suggestions and comments from the anonymous reviewers and the editors at Economy and Society, my thanks to them and to Dawn Bailey for their patience and support. For helpful insights and generous engagement with various questions and versions, I thank Ajay Gandhi, Atreyee Sen, Ishani Saraf, Jason Cons, Megha Sehdev, Pernille Hohnen, Raheel Khursheed, Renu Kohli, Sarah Tobin and Yathukalan Yogarajah. All shortcomings and errors are mine. Funding Information: Such claims were undermined by protests in Kashmir that continued regardless. However, as currency moved to digital forms under state surveillance, several individuals in Kashmir were charged for transferring ‘terror funds’ through hawala channels. Besides members belonging to the conglomerate of pro-freedom political parties, the All Party Hurriyat Conference (APHC), a number of traders were investigated and arrested by India's National Investigation Agency (NIA). Pro-freedom leaders in Kashmir condemned the NIA's ‘open chargesheet’ as an extensive tool for intimidation and silencing – allegations that were supported by a newspaper report that managed to obtain the 1,200 page document and revealed that it drew primarily on ‘open source’ information available in the public domain to frame charges of sedition (inciting ‘hatred, contempt and disaffections’ towards the government of India): for example, extracts from websites, protest calendars, speeches on YouTube, participation in the funerals of slain militants and calls for financial help to their families (Angad & Tiwary, ). In framing its chargesheet in Kashmir, the NIA was aided by the draconian UAPA, newly amended in 2019 to expand its scope for punishing the raising of funds ‘likely’ to be used to commit terrorist acts, irrespective of whether these funds were raised from legitimate or illegitimate sources. Specifically, the NIA singled out ‘LoC trade’ for facilitating ‘hawala’ transfers for funding ‘terror acts’. According to the NIA this was achieved through ‘over and under invoicing of goods’, that is, bartering goods of non-equivalent value instead of a zero-sum exchange, with the residue channelled by hawala brokers for funding various terror activities. Publisher Copyright: © 2022 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group.
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