Warlords, Inc.

by Noah Raford

  For many illiberal and less than legitimate states in the twenty-first century, embarking down the path of unspeakable crimes will become a likely adaption to the challenges of a 4GW threat. Their 5GW will be entering into the heart of darkness.

  8 Weaponizing Capitalism

  The Naxals of India

  Shlok Vaidya

  I have said in the past that left-wing extremism is the single biggest security challenge to the Indian state. It continues to be so.

  —Prime Minister Manmohan Singh

  Despite the attention potential conflict with Pakistan, Kashmir, and the menace of radical Islam receive, there is another, more immediate threat to India’s existence. In 2005, the government estimated that the Naxals are responsible for 89 percent of violent deaths. In 2012, Naxals conducted over 1,500 violent acts. Their influence spans two hundred districts, up from seventy-five just five years ago. Over the same time period, the Naxals have murdered thousands of civilians, killed hundreds of security forces, and lost many of their own.1 The once-suppressed Naxalite insurgency is siphoning the flows of globalization and inhibiting the economic expansion of almost half the country.

  From Ideology to Warfare

  The insurgency takes its name from the village where it originated, Naxalbari, in West Bengal. There, in March 1967, a generation of college-educated Maoist ideologues was given purpose when it united to free the peasant class from the bonds of servitude. By May, this cadre had recruited some two thousand villages and more than fifteen thousand residents as activists. In short order, these ragtag forces, armed with crude bows, arrows, and farming implements, had claimed some three hundred square miles of territory. Within this “liberated zone” the cadre set up a governing body that canceled debt, destroyed ownership records, and fixed wages as well as commodity prices. A focus on delivering on ideology resulted in a lack of emphasis on security, and soon a combination of poor tactical skills, lack of modern weaponry, and the overwhelming force of state police put an end to this insurrection. Five thousand attempts to reignite the flames of revolution over the next three years failed, and by 1972, some forty thousand members and leaders of the insurgency languished in jail.2 For the next decade, the Naxals lay mostly dormant. A handful of highly fragmented groups focused on energizing their rural population base and conducting sporadic guerrilla operations. When the violence began to gain intensity and speed, it faced ruthless opposition, particularly in Andhra Pradesh, and failed to achieve lasting impact. Not until India’s economy was pried open in 1991 did the Naxals again emerge on the national stage.

  This renewed campaign is focused on preventing the sale of India’s significant mineral resources. Over the past twenty years, India has signed thousands of contracts that parcel out its reserves of bauxite, thorium, and coal, respectively 10 percent, 12 percent, and 7 percent of the world’s reserves. India stands to do deals worth more than $80 billion, should the Naxals allow it.3 Unfortunately, 80 percent of these natural resources are found in four Naxal-afflicted states that lack governance and opportunity. Furthermore, despite aggregate foreign direct investment of $145 billion in this sector since 1991, the Reserve Bank of India estimates these four states receive less than five percent of this cash flow.4 As a result, these states constitute only 12 percent of the country’s gross domestic product, and none of their per capita income levels surpasses $900 per year. A recent study found that, compared to states not affected by the Naxals, these resource-rich but prosperity-poor states lost on average 12 percent of economic productivity year on year.5

  Sensing opportunity in globalization’s uneven distribution of capital, energy, and people, the modern Naxals have pioneered a strategy that enables the organization to wield these very flows against the state.

  A New Strategy

  We are ready with a blueprint to prevent entry into the region.

  —Rakeshji, Naxal Spokesman, Orissa

  Modern Naxals have corrected the flaws in their revolutionary predecessors’ model. Instead of relying on ideology to amass huge numbers with shared purpose, this generation is emphasizes execution: building tactical training capacity, capturing popular support, and stockpiling equipment. Instead of the bows and arrows, the new generation is armed with state-of-the-art weaponry. The goal remains the same—rendering the Indian state incapable of governing—but the means are notably different.

  Overruns

  On April 6, 2010, a convoy of 120 federal and state police forces returning to headquarters after operations deep in the forests of Dantewada was ambushed. Two land mines were detonated, and then three hundred Naxals swarmed the already fatigued troops. Reinforcements rushed to the scene, only to discover seventy-five dead policemen and the burning wreckage of a convoy that had been pillaged for firearms and equipment. This was the deadliest attack the insurgency had ever conducted.

  Adopting a tactic from the Maoist model, Naxals regularly overrun targets—that is, concentrate overwhelming numbers and firepower on a single location. In contrast to a strategy designed to maintain control of an area, as in Naxalbari, this guerrilla approach prevents state troops from engaging the group and minimizes the exposure of the insurgency to harm. In particular, Naxals target police forces and more specialized paramilitary soldiers patrolling the forests. After executing a successful ambush, the insurgents retrieve what equipment was not destroyed and disappear into the night. Any loot is amassed at later time in a secure location. In a two-year period beginning in 2008, the Naxals conducted six thousand such attacks. In addition to ambushes, the insurgency has conducted other operations:

  • They have used improvised explosive devices. Every year, dozens of police units inadvertently set off landmines placed in their path. To mitigate this, they began to use metal detectors able to find landmines just under the surface. But in response, Naxals adapted their approach. Now, the insurgency embeds explosives in roads while they are under construction. Naxals can simply connect their detonators to explosives already in place and lay in wait.6

  • They have assassinated officials. In a stunning attack in May 2013, Naxals assaulted a convoy of leading Indian National Congress officials, then stabbed select politicians and their sons. In all, twelve senior politicians and eight policemen were murdered. In an effort to silence former chief minister of Jharkhand Babulal Marandi, the insurgency stormed a sporting event attended by his brother. In the hail of gunfire, they killed his son instead. Only months earlier, the Naxals had publicly shot a member of Parliament, Sunit Mahato, seven times and set his jeep ablaze.7

  • They have destroyed police infrastructure. Naxals regularly overrun remote forest-ranger outposts as well as more urban police stations. The insurgency specializes in night raids that begin with grenades and are followed by indiscriminate automatic-weapons fire. In 2005, Naxals overwhelmed a jail in Bihar, setting free almost four hundred of their own. These prison breaks can even come from inside. A Naxal-led riot inside a Chhattisgarh prison overcame sixteen jailers. In all, 253 prisoners escaped, fifty of them members of the insurgency.8

  India is clearly under assault, and the situation is likely to worsen. Recognizing the disruptive value of thousands of overruns in rapid succession, Naxals have shifted their strategy to exploit this vulnerability.

  Disruptions

  The state-owned Coal India is the largest single holder of coal reserves in the world, at 64 billion tons. The company produces over 430 million tons of coal per year and held an initial public offering of its stock in 2010 that earned $53 billion. However, a deeper look at its portfolio reveals some troubling facts. A full 92 percent of the company’s coal production is from eleven fields that sit squarely in Naxal territory.9 As a direct result of the insurgency’s violence, the state of Jharkhand has seen coal production losses double from 60,000 in 2007 to 110,000 in 2011.10 Naxals attack not just the nodes but also the networks themselves.

  Railways, roads, and telecommunications infrastructures are prone to disruption by the insurgency as well.
There were nine hundred such attacks over the last four years—and the pace is quickening. In 2008, there were a reported thirty Naxal-related security incidents on the railways. This figure almost doubled—to fifty-eight—in 2009. These attacks include bombing freight trains; destroying tracks in order to derail trains; holding passengers hostage; and conducting hijackings in which only the train’s engineer is left, but hundreds of paying passengers are removed and replaced with sympathizers.11 These tactics require remarkably few resources to execute, yet generate out-sized returns. The case of the Jnaneswari Express—a fast passenger train—in 2010 illustrates the destructive potential of even the simplest of attacks. In the hours before the Jnaneswari was to pass by, Naxal-affiliated organizations pulled the spikes tethering fifty feet of the railroad tracks to the ground using only a shovel and a pick. The group also removed a one-foot section of the track itself. When the train approached, the tracks shook and destabilized the engine, and the train derailed. A freight train headed in the opposite direction was unable to stop and slammed into the thirteen carriages littered across the track. In minutes, 141 were dead and 180 were injured.

  Even in instances when no one is hurt by a Naxal attack on the railway, the insurgency can cause major delays to cascade through the system, such as in 2010, when Naxals destroyed three feet of track and halted twenty-four trains.12 Because of this threat, all night trains through insurgency-affected areas have been halted. Companies have resorted to transporting goods by road—incurring costly delays in the process. In 2009 alone, the Indian Railways lost $110 million—a 40 percent loss from the previous year.13 There are long-term consequences as well. In Jharkhand, a $259 million increase in costs caused by frequent Naxal attacks has halted six major railway-development projects.14

  The Mineral Development Corporation (NMDC), distressed by the inability of the railways to keep pace with the NMDC’s production schedule, constructed a pipeline system, failing to note that this sort of infrastructure is particularly vulnerable to the same kind of attack. Sure enough, in June 2009, the Naxals blew up a critical pipeline and caused a loss of $200 million.15 To prevent this from happening again, the NMDC is building a $200 million pipeline system along existing roads.16 Unfortunately, the road network is easily disrupted as well. Naxals frequently attack contractors building roads and set vehicles and machinery on fire to delay construction.17 These attacks are troubling, given that the NMDC relies on a single district in Chhattisgarh for 71 percent of its output, and that district is hard-hit by Naxals.18

  In contrast to railways, pipelines, and roads, all of which have been in place for some time, telecommunications infrastructure is still in its infancy, having taken off only in 2004. Disrupting this system enables the Naxals to isolate rural areas from the flow of information. Informers and police forces are prevented from passing on intelligence or calling for reinforcements when mobile networks are down.

  Since 2006, Naxals have destroyed more than three hundred cell-phone towers in six states. It is interesting to note that more than 60 percent of these attacks took place after 2008, in what is likely a response to the surge in the number of towers being built. In Jharkhand, there are already close to nine hundred towers, and Chhattisgarh has five hundred of its own. The government is intent on building an addition 550 throughout the Naxal-affected areas.19 But this will be a turbulent process, should it happen at all. In 2009, the state-owned Bharat Sanchar Nigam Limited planned to build fourteen towers in south Orissa. After Naxals attacked three, causing $700,000 in damage, the company temporarily abandoned its plans to expand in the area. Despite this, plans proceed to install three thousand new towers throughout the affected areas.20

  To mitigate this threat, in a tactic not unlike the NMDC’s plan for locating pipelines along roads, the communications providers have taken to placing cell-phone towers within the walls of the network of police camps that litter the forests. The state views this as a way of controlling the battle space. Raids conducted by the Naxals, however have shown that this is not a deterrent, and in fact, it could present an incentive, as it provides the opportunity to attack two valuable targets at once. This begs the question: if the Naxals possess overwhelming force, the element of surprise, and the ability to successfully execute hundreds of these attacks per year, why aren’t they concentrating on the highest-yielding attacks on critical infrastructure?

  The Deviant Economic Engine

  The Naxals see industry as a source of earning and won’t ruin its work.

  —Vishwa Ranjan, director general of police, Chhattisgarh

  The answer is to be found in what is the clearest demarcation between Naxalbari’s revolutionaries and the insurgency of today. This generation has embraced the very activity the Maoist ideology so vehemently opposes: profit. India’s illicit economy is estimated to be between 40 and 71 percent of the size of the legitimate economy—somewhere between $500 billion and $1 trillion.21 The Naxals underpin a huge segment of this growing market. Weaponizing capitalism has sparked a deviant economic engine that steadily burns through the poorest parts of India with minimal effort.

  The Revolutionary Tax

  In 2000, India began an ambitious project to connect at-risk villages with populations greater than one thousand to major road arteries by 2003. By 2007, it planned to connect all villages with more than five hundred people. It is a powerful initiative, and thus far India has built 175,000 miles of roads, though much of the remaining 1.6 million miles of rural road system remains barely passable. This project was reinforced in late 2010 by a $1.5 billion loan from the World Bank to build another fifteen thousand miles of road to the benefit of six million people.22 The government and the people were not the only ones to cheer this initiative on. This investment represents a huge windfall for the Naxals as well. Former director of the Intelligence Bureau Ajit Doval estimates that between 30 and 40 percent of development funds have been captured by the Naxals.23

  Having proven their ability to destroy critical nodes and crash networks, Naxals are now able to exact ransoms with the mere threat of violence. The insurgency extorts hundreds of millions of dollars from businesses and others, including small shops, paper and rice mills, doctors, and property owners. The insurgency calls this a “revolutionary tax.” This strategy yields massive return. In Chhattisgarh alone, Naxals extorted $60 million from mining firms, the transportation sector, and government contractors in 2009.24 That state’s director general of police, Vishwa Ranjan, estimated the national revenue of the Naxals at $400 million per year.25 Perhaps due to the outcry around these large figures, the following year’s estimates were remarkably lower, at $30 million and $280 million, respectively.26

  How much the Naxals are able to extort depends on to how much the government spends, and because of this, there is no sign that this source of revenue will diminish. The government has allocated $3 billion over the next decade for construction designed to dampen the Naxal threat, including affordable housing, roads, highways, hostels, hospitals, drinking water projects, and electricity networks.27

  A Revolutionary Tax Economy

  Whereas the state can levy tax only on legitimate enterprises, the Naxals have expanded their tax pool to include illicit actors as well, such as extortionists, smuggling rings, and drug producers. Rather than assume the costs of running these operations using their own human capital and assets, the insurgency incentivizes and enables others in the extortion ecosystem.

  Each Naxal foot soldier is paid $60 per month, with a performance bonus based on how much revenue he or she brings in. The market sets pricing, though one captured leader revealed going rates for extortion (on a monthly basis): $2 for daycares, $4 for elementary-school teachers, $10 for high-school teachers, $4 for bank employees, $14 for bank managers, $100 for businessmen, and $.20 and a kilogram of rice for villagers.28 This corporate model enables individual and organizational profit to grow together. This system steadily generates revenue for all parties involved, but given that individual cells and
leaders manage their own budgets, their relationship with one another can be contentious. There have been several noted heists and conflicts between factions jockeying for larger shares.29

  The Naxals are not only market makers but regulators as well. In Chhattisgarh, gangs of unemployed young men used to shake down businesses and government officers using letters that imitated those written by real Naxals. Only when victims complained that they were being asked to pay twice per month did the Naxals respond to this dilution of their brand. In 2009, they began to enforce a simple edict: gangs were allowed to extort so long as they did not cut into existing Naxal revenue. As a result, the criminals are now giving a portion of their revenue, estimated at more than $4 million, to the insurgency while seeking out new victims.

  This deviant economic engine is being fueled not only by extortion. The model is leveraging a variety of illicit activity across the country:

  • Mining. Government records show 182,000 instances of illegal mining across seventeen states, with 30 percent of those being found in the Naxal-affected area. There are an estimated sixty thousand illegal mines operating today, with five hundred million untrained laborers working in entirely unregulated conditions.30 These mines are operated by criminal organizations that also pay into the Naxal revenue pool. Prasoon S. Majumdar, editor of economic affairs at The Sunday Indian, estimates that Naxals receive between 20 and 30 percent for each truckload of coal, with another 15 percent reserved for corrupt local bureaucrats and policemen.31 To continue their work unhindered, illegal miners bribe individual police inspectors at the cost of $7,000 per year.