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COMBATING THE HAQQANI TERRORIST NETWORK

HEARING

BEFORE THE

SUBCOMMITTEE ON TERRORISM, 

NONPROLIFERATION, AND TRADE

OF THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED TWELFTH CONGRESS

SECOND SESSION

SEPTEMBER 13, 2012

Serial No. 112–177

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/ or

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

ILEANA ROS-LEHTINEN, Florida, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

DAN BURTON, Indiana 

ELTON GALLEGLY, California 

DANA ROHRABACHER, California 

DONALD A. MANZULLO, Illinois 

EDWARD R. ROYCE, California 

STEVE CHABOT, Ohio 

RON PAUL, Texas 

MIKE PENCE, Indiana 

JOE WILSON, South Carolina 

CONNIE MACK, Florida 

JEFF FORTENBERRY, Nebraska 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

GUS M. BILIRAKIS, Florida 

JEAN SCHMIDT, Ohio 

BILL JOHNSON, Ohio 

DAVID RIVERA, Florida 

MIKE KELLY, Pennsylvania 

TIM GRIFFIN, Arkansas 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

ANN MARIE BUERKLE, New York 

RENEE ELLMERS, North Carolina 

ROBERT TURNER, New York 

HOWARD L. BERMAN, California 

GARY L. ACKERMAN, New York 

ENI F.H. FALEOMAVAEGA, American 

Samoa 

BRAD SHERMAN, California 

ELIOT L. ENGEL, New York 

GREGORY W. MEEKS, New York 

RUSS CARNAHAN, Missouri 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

BEN CHANDLER, Kentucky 

BRIAN HIGGINS, New York 

ALLYSON SCHWARTZ, Pennsylvania 

CHRISTOPHER S. MURPHY, Connecticut 

FREDERICA WILSON, Florida 

KAREN BASS, California 

WILLIAM KEATING, Massachusetts 

DAVID CICILLINE, Rhode Island 

YLEEM D.S. POBLETE, Staff Director 

RICHARD J. KESSLER, Democratic Staff Director 

SUBCOMMITTEE ON TERRORISM, NONPROLIFERATION, AND TRADE

EDWARD R. ROYCE, California, Chairman 

TED POE, Texas 

JEFF DUNCAN, South Carolina 

BILL JOHNSON, Ohio 

TIM GRIFFIN, Arkansas 

ANN MARIE BUERKLE, New York 

RENEE ELLMERS, North Carolina 

BRAD SHERMAN, California 

DAVID CICILLINE, Rhode Island 

GERALD E. CONNOLLY, Virginia 

ALLYSON SCHWARTZ, Pennsylvania 

(III)

C O N T E N T S 

Page

WITNESSES 

Ms. Lisa Curtis, senior research fellow, Asian Studies Center, The Heritage 

Foundation ............................................................................................................ 7

Mr. Jeffrey Dressler, senior research analyst, Institute for the Study of War ... 20

Ms. Gretchen Peters, author, Haqqani Network Financing ................................. 28

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

The Honorable Edward R. Royce, a Representative in Congress from the 

State of California, and chairman, Subcommittee on Terrorism, Nonproliferation, and Trade: Prepared statement ................................................... 3

Ms. Lisa Curtis: Prepared statement ..................................................................... 10

Mr. Jeffrey Dressler: Prepared statement ............................................................. 22

Ms. Gretchen Peters: Prepared statement ............................................................ 31

APPENDIX 

Hearing notice .......................................................................................................... 50

Hearing minutes ...................................................................................................... 51

The Honorable Gerald E. Connolly, a Representative in Congress from the 

Commonwealth of Virginia: Prepared statement .............................................. 53

(1)

COMBATING THE HAQQANI TERRORIST 

NETWORK 

THURSDAY, SEPTEMBER 13, 2012

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON TERRORISM, NONPROLIFERATION, AND TRADE, COMMITTEE ON FOREIGN AFFAIRS, Washington, DC. 

The subcommittee met, pursuant to notice, at 2:08 p.m., in room 

2172, Rayburn House Office Building, Hon. Edward R. Royce 

(chairman of the subcommittee) presiding. 

Mr. ROYCE. This hearing of the subcommittee will come to order. 

This hearing title is ‘‘Combating the Haqqani Terrorist Network.’’ 

We are examining a terrorist network that the State Department 

has just decided to designate as a Foreign Terrorist Organization. 

And yesterday, we were all saddened and angered over the killing 

of an American diplomat and three other U.S. Government personnel during an attack on our consulate in Benghazi, Libya. Exactly 1 year ago today, it was the Haqqani network that launched 

a 20-hour long assault on the U.S. Embassy compound in Kabul. 

And that attack left 16 Afghans dead. 

It was after this attack that our then top military officer pronounced the Haqqani network a ‘‘veritable arm’’ of the Pakistani 

ISI used to pursue its paranoid policy of ‘‘strategic depth’’ in Afghanistan. The Haqqani base of operation in Pakistan’s tribal area 

of North Waziristan is the most important militant haven in the 

region. Al-Qaeda is said to train and plan attacks under the protection of the Haqqani network from their bases there. Indeed one 

prominent report finds that ‘‘the Haqqani network has been more 

important to the development and sustainment of al-Qaeda and the 

global jihad than any other single actor or group.’’ The Haqqanis 

have plenty of blood on their own hands, killing U.S. and coalition 

forces. 

Yet the State Department more than dragged its feet in doing 

the obvious, which would have been to blacklist the Haqqani network. Despite calls from U.S. commanders to act, it kept the case 

under lengthy review. Frustrated, Congress—on a bipartisan 

basis—unanimously passed the Haqqani Network Terrorist Designation Act of 2012, and that legislation was signed into law last 

month. This act spurred last week’s designation announcement, 

which apparently was not an easy one for the administration to 

make. Without congressional pressure, I am sure the Haqqanis 

would have been under permanent review, further shortchanging 

our efforts against it. 

2

This hearing is about looking ahead though. What can we do 

now? In this regard, it is too bad the State Department was unable 

to provide a witness to discuss what this designation will mean 

operationally. 

The Foreign Terrorist Organization (FTO) designation sets the 

stage to attack the vast financial network supporting the Haqqanis. 

And as we will hear today, this outfit has built an empire out of 

kidnappings, out of extortion, out of their smuggling operations. 

Arab donors from the Middle East, trucking firms, car dealerships, 

real estate. The financial streams running into North Waziristan 

are very diverse and widespread. We have many targets. 

As one witness notes, while they have faced military pressure, 

‘‘the Haqqanis have never had to deal with a sustained and systemic campaign against their financial infrastructure.’’ As Ms. Peters will testify, such a campaign, in concert with military efforts, 

could even bring the Haqqani network to the point of ‘‘collapse.’’ 

That is optimistic but at least now possible with the Foreign Terrorist Organization designation that has been made. 

This subcommittee has looked at U.S. Government financial 

squeezes on others: The North Korean criminal state, arms dealers, 

such as Victor Bout, A.Q. Khan, and Hezbollah. Success has required sustained support and leadership from the very top. Given 

the administration’s dithering on the Haqqani designation, it is 

right to be concerned about its will to execute an aggressive financial campaign against that entity. 

Concluding, this cannot be a case of designate and forget. It is 

clear that continued congressional pressure will be needed to ensure that this was just a step toward hammering the Haqqani network. 

And I will now turn to our ranking member, Mr. Sherman from 

California, for his opening statement. 

[The prepared statement of Mr. Royce follows:]

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Mr. SHERMAN. Thank you, Mr. Chairman for holding these hearings. I want to join with you in our expression of both regret and 

anger as to the death of our diplomats in Benghazi. And I know 

that the administration is responding with urgency to work with 

the Libyan Government to bring these attackers to justice. 

Now the focus of our hearing. The Haqqani network based in 

Pakistan’s tribal areas is commonly viewed as the most lethal force 

battling us in Afghanistan. The group is responsible for many high 

profile attacks, including the attack on the U.S. Embassy in Kabul 

in September 2011. Secretary of State Hillary Clinton formally announced the designation of the militant Haqqani network responsible for these deadly attacks as a terrorist organization last Friday. I commend the Obama administration and the Secretary of 

State for making this choice. 

The Haqqani Network Terrorist Designation Act of 2012 was 

passed by this Congress and called upon the State Department to 

report within 30 days on the issue of designating the Haqqani network. I cosponsored that bill and also cosponsored a House bill 

with our colleague Ted Poe which would have simply taken the 

matter out of the administration’s hands and designated what we 

all knew to be true and that by any definition, and certainly the 

definition of our laws, the Haqqani network was a terrorist organization and remains so today. 

This designation last Friday was not the first action taken 

against the Haqqani, either legal or kinetic. Several Haqqani network members were already on the U.S. Government’s list of specially designated global terrorists. The administration has posted a 

$5 million reward leading to the capture of one of the group’s leaders and killed the main leader’s son who was also an operational 

figure. This is an organization, the Haqqani network, that works 

hand in hand with the Taliban and has a history of supporting alQaeda. 

Most worryingly, then Chairman of the Joint Chiefs of Staff, Admiral Mullen, testified before Congress that the Haqqani network 

acts as a veritable arm of Pakistani intelligence, the ISI. The admiral also noted that with ISI support Haqqani operatives planned 

and conducted the assault on the U.S. Embassy in September 2011. 

So this is a terrorist organization that seems to be benefiting 

from moneys of the U.S. taxpayer in two ways. First, we provide 

a lot of aid to Pakistan with insufficient control. Much of that ends 

up in the hands of the ISI, and the ISI then supports the Haqqani 

network. 

Second, our use of private contractors to get supplies into Afghanistan, combined with the fact that we maintain 85,000 or more 

troops there, means that these private contractors sometimes find 

it profitable to pay protection money to the Haqqanis. So both our 

foreign aid funds and our military operations funds can find their 

way into Haqqani hands. 

The Haqqani network has a sophisticated financial means, according to recent studies. The organization raises money from those 

who are ideologically sympathetic donors, but also gets profit from 

smuggling the protection payments and transportation that I have 

previously mentioned, et cetera. 

6

In fact, the labeling of the Haqqani network as a terrorist organization is necessary but not sufficient. Now is the time for the State 

Department and Transportation Department to ramp up efforts to 

go after the network’s global finances and businesses and front 

companies. 

We also have to change our policy toward Pakistan. Part of that 

is reaching out to the Pakistani people. We should no longer kowtow to Islamabad when they tell us that the Voice of America 

should broadcast only in Urdu. It is time to reach out to the Pakistani people in other languages, particularly southern Pakistan in 

the language of Sindhi. And it is time for us to try to go around 

the military-dominated political forces in Islamabad and reach out 

to the Pakistani people while at the same time conditioning our aid 

on different policies of the Pakistani Government. 

And I yield back. 

Mr. ROYCE. Thank you, Mr. Sherman. 

We will go now to Mr. Connolly of Virginia for 3 minutes for your 

opening statement. 

Mr. CONNOLLY. Thank you, Mr. Chairman. I also want to commend the State Department for declaring the Haqqani network as 

a Foreign Terrorist Organization, however long overdue that designation might have been. But I want to join with the chairman in 

expressing disappointment that the State Department is not represented here today. I think they owe the subcommittee and the 

Congress a fuller explanation for how and why we got to that determination and operationally, as the chairman suggested, what it 

means moving forward. Responsibility to account to the Congress 

is a constitutional responsibility and it is not a matter of when and 

if the administration chooses to respond to Congress’ request to testify before a subcommittee such as this. 

I must say the designation, however, raises as many questions 

as it provides answers. What does it mean with our drawdown in 

Afghanistan just across the border given the impunity with which 

the Haqqani network now operates in that part of Pakistan? What 

does it mean that there is clear and documented evidence that the 

ISI, the Pakistani ISI, has long provided overt protection, including 

security protection, to leaders of the Haqqani network within the 

Pakistani borders? And what does that mean for the level of cooperation that is actually cited in the designation announcement in 

which Pakistan was referred to as an extremely valuable ally in 

countering extremism and terrorism? How does that comport with 

overwhelming evidence that one branch of the Pakistani Government is not cooperating in those endeavors at all when it comes to 

the Haqqani network? 

So I am looking forward, Mr. Chairman, to this hearing and to 

the testimony to be provided. And like you, I wish the State Department were represented here. I think they should be. Thank you 

so much for holding the hearing. 

Mr. ROYCE. Thank you, Mr. Connolly. 

Ms. Lisa Curtis is the senior research fellow for South Asia at 

the Heritage Foundation. And before joining Heritage, she served 

on the Senate Foreign Relations Committee staff and at the State 

Department and at the Central Intelligence Agency. She has apVerDate 0ct 09 2002 11:45 Oct 17, 2012 Jkt 000000 PO 00000 Frm 00010 Fmt 6633 Sfmt 6633 Y:\WORK\TNT\091312\75860 HFA PsN: SHIRL
7

peared before the House Foreign Affairs Committee numerous 

times. It is good to have you back. 

Mr. Jeffrey Dressler is a senior research analyst and leads the 

Afghanistan and Pakistan team at the Institute for the Study of 

War. He has written several extensive reports on the Haqqani network. Mr. Dressler was invited to Afghanistan in July 2010 and 

participated in a team conducting research for General David 

Petraeus. 

And lastly, we have Ms. Gretchen Peters, a researcher and author. In July, the Combating Terrorism Center at West Point published her extensive thesis, ‘‘Haqqani Network Financing: The Evolution of an Industry.’’ She is also author of a book, ‘‘Seeds of Terror,’’ which traces the role of the opium trade in Afghanistan. 

We will start with Ms. Curtis. 

STATEMENT OF MS. LISA CURTIS, SENIOR RESEARCH FELLOW, ASIAN STUDIES CENTER, THE HERITAGE FOUNDATION 

Ms. CURTIS. Thank you very much, Mr. Chairman, Ranking 

Member Sherman. 

Mr. ROYCE. I am going to ask you to push the button there. 

Ms. CURTIS. Thank you, Mr. Chairman, Ranking Member Sherman, and the rest of the distinguished committee for inviting me 

here today. 

The Obama administration’s designation of the Haqqani network 

as a terrorist organization was certainly a welcomed if not long 

overdue step. The Heritage Foundation has been calling for this 

designation for a year, ever since the Haqqani network attacked 

the U.S. Embassy in Kabul on this day a year ago. This designation will facilitate U.S. goals in Afghanistan by pressuring Pakistan to deal effectively with this deadly group and assisting the 

U.S. in attacking the group’s financial network. 

Since Pakistan has failed over the last 3 years to either take 

military action against the group or to bring this group to compromise at the negotiating table, the U.S. had little choice but to 

corner Islamabad on the issue. Pakistani officials had repeatedly 

questioned why they should take military action when U.S. policy 

toward the group was ambiguous. With this designation, the U.S. 

leaves no doubt on where it stands on the issue and thus removes 

a major Pakistani excuse for failing to take action. 

Up to this point, Pakistani military officials seem to have calculated that the U.S. would acquiesce to a strong Haqqani role in 

any future political dispensation in Afghanistan. Now the U.S. has 

signaled that instead it would work to prevent the Haqqanis from 

re-establishing their base in Afghanistan. 

I think people are generally familiar with who are the Haqqanis, 

but let me briefly talk about who they are. Jalaluddin Haqqani is 

a powerful, independent, militant leader whose followers operate 

mainly in eastern Afghanistan in the provinces of Paktia, Paktika, 

and Khost. They operate from their headquarters in North 

Waziristan in Pakistan’s tribal border areas. 

Jalaluddin Haqqani has been allied with the Afghan Taliban for 

over 16 years, having served as the tribal affairs minister in the 

Taliban regime in the late 1990s. His son Sirajuddin is now the 

operational commander of the group. 

8

The Haqqani network of course has been a major facilitator of 

the Taliban insurgency, having conducted some of the fiercest attacks against U.S. and coalition forces, Afghanistan civilians, and 

U.S. civilian interests. The source of the Haqqanis’ power stems 

mainly from their ability to forge relations with a variety of terrorist groups in the region as well as with the Pakistani intelligence service. Pakistani military strategists view the Haqqani 

network as their most effective tool for blunting Indian influence 

in Afghanistan. 

The overarching goal of the U.S. should be to end Islamabad’s 

dual policies toward terrorism. Islamabad’s continuing support for 

the Taliban, the Haqqani network, and other terrorist groups is 

jeopardizing the entire U.S. and NATO mission in Afghanistan. 

It is true that Pakistan has facilitated efforts to degrade alQaeda’s capabilities. We have shared intelligence with the Pakistanis. Pakistan has helped us capture key al-Qaeda leaders. And 

for all its complaints about drones, Pakistan has never taken direct 

hostile actions against the drone program. Still, Islamabad’s inconsistent approach to terrorism is undermining the stability of the 

state. It is no secret that several thousand Pakistani civilians and 

security forces have been killed in attacks by the Tehrik-e-Taliban 

Pakistan, the TTP. So it is simply confounding that Pakistan’s military would support the Haqqani network when it cooperates with 

the TTP. 

Let me say a few words about peace talks. One of the most frequent arguments against designating the Haqqani network was 

that it could upset efforts to engage in peace negotiations. But the 

Haqqanis have had ample chance to engage in negotiations. And it 

should be noted that only 1 month after the U.S. met with 

Jalaluddin Haqqani’s brother Hajji Ibrahim Haqqani a year ago, it 

was only 1 month later that the Haqqani network attacked our 

Embassy in Afghanistan, clearly signaling their lack of interest in 

negotiations. 

The administration must avoid the temptation to pin false hopes 

on a political reconciliation process merely to justify a troop withdrawal. Political reconciliation is desirable but only if it contributes 

to the goal of ensuring that Afghanistan never again serves as a 

safe haven for terrorists. 

Any political solution with the Taliban must, one, preserve the 

human rights improvements of the past decade; two, maintain the 

integrity of the democratic political process; three, ensure the 

Taliban has broken ranks with al-Qaeda; and four, make sure the 

U.S. maintains the capability to retain a troop presence for counterterrorism and training missions well beyond 2014. 

So in conclusion, the onus is on Pakistan to demonstrate it is 

willing to squeeze insurgents on its territory and to use its leverage 

with these groups to bring them to compromise. Otherwise the U.S. 

and NATO must try to isolate Pakistan in the region and limit its 

ability to influence developments in Afghanistan. It should be clear 

that unless Pakistan supports the U.S.-led strategy in Afghanistan, 

it will sacrifice U.S. aid and diplomatic engagement. The U.S. will 

look toward other like-minded partners in the region and even be 

prepared to block IMF and World Bank loans which are critical to 

the health of the Pakistani economy. 

9

The way Pakistan deals with Afghanistan over the next 2 years 

will have a lasting impact on how it is viewed and treated by the 

international community. Pakistani brinkmanship in Afghanistan 

would likely carry high costs for the country over the long term. 

Thank you. 

Mr. ROYCE. Thank you, Ms. Curtis. 

[The prepared statement of Ms. Curtis follows:]

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Mr. ROYCE. We are going to, due to the votes, take a recess for 

approximately 25 minutes after which time we will resume. So in 

the interim, we stand in recess. Thank you. 

[Recess.] 

Mr. ROYCE. The committee will come to order. 

Let me recap, because earlier I mentioned the role that Congress 

played in getting the Haqqani network designated as an FTO. But 

also key to that was the information being put out by private researchers. And we are joined today by three of these expert witnesses who have worked on this subject matter. And we are now 

going to go to Mr. Jeffrey Dressler for his testimony. 

STATEMENT OF MR. JEFFREY DRESSLER, SENIOR RESEARCH 

ANALYST, INSTITUTE FOR THE STUDY OF WAR 

Mr. DRESSLER. Thank you, Mr. Chairman, Ranking Member 

Sherman, and committee members, for inviting me to testify about 

the Haqqani network Foreign Terrorist Organization with historical and enduring ties to al-Qaeda and their affiliates that poses a 

threat to American national security interests. Accordingly, it is 

imperative to focus all available instruments of U.S. Military and 

economic power against the network. 

The Haqqani network is responsible for the vast majority of the 

most heinous attacks against U.S. international organizations, Afghan forces, and innocent Afghan civilians. Some of the most notable attacks include a June 2012 raid of a lakeside hotel in Kabul 

killing 18 and two September 2011 attacks, one on the U.S. Embassy and ISAF headquarters and another attack consisting of a 

suicide truck bombing of U.S. Combat outposts in Wardak province, 

injuring 77 U.S. soldiers. 

Sirajuddin Haqqani, leader of the Haqqani network, no longer 

heads the tribal insurgency limited to remote regions of southeastern Afghanistan. His organization is not simply a Mafia-like 

criminal network solely focused on maximizing profits. The network’s vast licit and illicit financial enterprise enables them to pursue their strategic and operational objectives. They maintain a 

working partnership with groups like al-Qaeda and its allies and 

affiliates to include Lashkar-e-Taiba, which conducted the Mumbai 

attacks, and a litany of other terrorist actors. Haqqani has provided lethal support to those groups as they pursue an international global jihadist agenda. The network maintains a national 

reach and has national level objectives, which I am happy to elaborate on the in the Q&A period. 

Although the Haqqani network’s historical area of influence was 

limited to the southeastern provinces of Khost, Paktia and Paktika, 

the network has slowly spread into the surrounding provinces surrounding Kabul. The Haqqani network’s presence in Wardak, 

Logar, Nangarhar, Kapisa and Laghman provinces facilitates their 

attacks in Kabul, and the network generates revenues for those attacks through kidnapping, extortion, and smuggling. 

In northern Afghanistan, the Haqqani network is closely 

partnered with terrorist organizations such as the Islamic Movement of Uzbekistan and local insurgent groups who depend on the 

Haqqani network’s facilitation, command and control, and finances. 

This relationship affords the Haqqani network a disproportionate 

21

amount of influence in northern Afghanistan relative to its physical 

presence. In the north, Haqqani network fighters have engaged in 

destabilizing assassinations of key northern political military figures, such as General Saeed Kili, the former Kunduz police chief, 

General Daud Daud, the northern zone police commander, and 

more recently, Ahmed Samangani, a prominent parliamentarian 

assassinated at his daughter’s wedding. Of course the Haqqanis 

have also attempted unsuccessful assassinations of Bismullah 

Kahn and Fahim Kahn, key leaders of Afghanistan’s Tajik block. 

If this trend continues, it could provoke Tajik leadership to withdraw from the government in Kabul, which could be the catalyst 

for a national level civil war reminiscent of the 1990s but perhaps 

in this case even more brutal. Furthermore, if the Haqqani-led 

presence in the north continues to expand, it could provide a platform for the spread of terrorist attacks in Central Asia spearheaded by the Islamic Movement of Uzbekistan. 

However, the threat from the Haqqani network is not simply an 

Afghanistan-specific problem. The network also represents a threat 

to regional stability. In Pakistan’s tribal areas, the Haqqanis’ relationship and stature amongst myriad terrorist groups with local regional and international agendas continue to expand. Although the 

Haqqani network has not directly orchestrated an international 

terrorist plot, they are supportive and committed to an international jihadist ideology and have provided shelter, training, protection, and resources to groups who have attempted to execute 

international terrorist plots, to include al-Qaeda, the Islamic Movement of Uzbekistan, the German Jihad Mujahedin, and of course 

Lashkar-e-Taiba, among many others. The Haqqanis are now seen 

as the most lethal facilitator of terrorist groups in the region and 

yet at the same time continue to serve as key interlocutors between 

the Pakistani security services and anti-Pakistan groups, such as 

the TTP, or the Tehrik-e-Taliban Pakistan. For this reason and because the Haqqanis continue to serve as proxy forces for elements 

of Pakistan’s security establishment, they have been allowed to operate with relative impunity and in some cases have received active 

facilitation and support. 

In closing, designating the Haqqani network as a Foreign Terrorist Organization and as a specially designated global terrorist 

entity is of both substantive and symbolic importance. The intelligence community must prioritize identifying and analyzing the 

Haqqani network’s global economic enterprise, including second 

and third party individuals and institutions who conduct business 

with the network in Pakistan and abroad. Furthermore, as is the 

case with most specially designated global terrorist entities, the 

Haqqani network should be added to the United Nations al-Qaeda 

sanctions list, which would pave the way for flight bans for network members and additional measures aimed at undermining the 

network’s operations. 

Last but not least, U.S. policymakers must raise awareness of 

the Haqqani network financial operations in Gulf states such as 

the UAE and urge all relevant foreign governments to assist with 

efforts to target and restrict the Haqqani network’s activities. 

22

Thank you, Mr. Chairman, committee members, for the opportunity to appear before you today, and of course I look forward to 

answering your questions. 

Mr. ROYCE. Thank you very much, Mr. Dressler. 

[The prepared statement of Mr. Dressler follows:]


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Mr. ROYCE. We will now go to Ms. Peters. 

STATEMENT OF MS. GRETCHEN PETERS, AUTHOR, HAQQANI 

NETWORK FINANCING 

Ms. PETERS. Thank you, Mr. Chairman, and to Ranking Member 

Sherman and to the respected members of the subcommittee. 

We have seen this week in Libya why as a country we must remain vigilant about the problem of extremist terrorists around the 

world. And I strongly believe that the Haqqani network is the type 

of threat network that the United States needs to remain vigilant 

against and also take action against. 

Since 2005, I have spent a great deal of my time studying the 

links between organized crime and insurgency in Afghanistan and 

Pakistan. I have studied among other groups the Quetta Shura 

branch of the Taliban, Hezb-e-Islami Gulbuddin, Lashkar-e-Taiba, 

Lashkar-e-Jangvi, al-Qaeda, the Islamic Movement of Uzbekistan. 

And most recently, I have spent the better part of the last 2 years 

looking at the Haqqani network’s financial infrastructure. 

Now it is well known, as both of have you have commented previously, that the Haqqanis are the most ruthless and violent faction of the Taliban and also that they have the capacity to launch 

spectacular attacks against U.S. installations and other important 

sites in the capital Kabul and around Afghanistan. We all know 

that they have hosted, facilitated, and networked with all sorts of 

bad actors around the region, from other extremist groups like alQaeda and the Pakistani Taliban whom they continue to work with 

closely, and also criminal networks like Dawood Ibrahim’s D-Company. 

What is less known, what even came as a surprise to me, was 

the extent of their criminal business network. This is not only the 

most ruthless and violent network in Afghanistan and Pakistan, it 

is also the most diversified from a business standpoint. 

Now most of the groups that I have looked into, that I named 

before, engage in some sort of protecting smuggling or smuggling 

themselves, usually narcotics, sometimes other resources like timber or gemstones. The Haqqanis are also involved in that. Many of 

the groups also engage in kidnapping and extortion. The Haqqanis 

are involved in all of that. And I would say they systematically extort all business that takes place in their areas of operation. One 

of the things that we found from interviewing community members 

and business leaders in the areas that the Haqqanis operate is that 

business does not get done unless the Haqqanis profit off it and 

condone it in their areas. 

Now on top of that, they also get involved in a lot of other businesses that we don’t see other networks involved in. Smuggling of 

timber, gemstones, mining operations, chromite and marble, electronics import and export, clothing, cooking oil and other food products. They run construction companies. Some of these construction 

companies have even gotten contracts by the coalition for USAID 

projects in the region. They raise an enormous amount of money 

from ideological donors and also run fundraising programs at 

mosques around the region, not just in Afghanistan and Pakistan 

but as far away as the Emirates and Saudi Arabia and Kuwait. 

29

They also, as my colleague Mr. Dressler mentioned, engage in 

what I would call—they act sort of like guns for hire. They will do 

work for the Pakistan Government, or the Pakistan’s ISI. They will 

assassinate people around Afghanistan. They will work for other 

branches of the Taliban. They will even carry out killings, targeted 

killings, to settle scores between business people and the community. 

So in other words, they operate very much like a sophisticated 

transnational Mafia network. They have expanded their area of operations inside of Afghanistan, as Jeff mentioned. They have also 

expanded across the region and really around the world. We found 

evidence of operations that extended as far away as South Africa—

meaning they do—again, I want to stress the point that this is a 

transnational operation with bank accounts and entities that they 

own in areas where the U.S. can access them through the legal authorities that we have. I can’t say for sure how much they earn. 

I think it is a mistake for people like me to try and put estimates 

on criminal earnings. But what I can say with absolute surety is 

they earn a lot more money than they spend. And we need to I believe put together a task force to figure out more specifically where 

that money is and start seizing it, and freezing it. 

They continue to collaborate on criminal and terrorist activities 

with the Pakistani Taliban, the Quetta Shura Taliban, al-Qaeda, 

and other groups in the region. This is the most clear with their 

criminal activities, particularly smuggling and kidnapping. I interviewed about a half a dozen people who had been kidnapped by the 

Haqqanis. They all described seamless cooperation between the 

Haqqanis and other networks, including the Pakistani Taliban. 

And I would like to just very briefly make the point that some Pakistani officials will describe the Haqqanis as the ‘‘good Taliban,’’ the 

Taliban that they can work with. When you start following the 

money, when you start looking into their criminal activities, they 

are working very, very closely with the Taliban that the Pakistanis 

considered the ‘‘bad Taliban.’’ And I think this network is as much 

a risk to Pakistan as it is to the United States. 

I also believe that their relationship with the ISI, although 

close—and this is a relationship that has lasted since the 1970s, 

Jalaluddin Haqqani was one of the first Afghan Islamists to 

emerge and to work very closely with the ISI, even prior to the Soviet arrival in Afghanistan. But today the relations with the ISI 

are much more fraught than many outsiders imagine. The ISI certainly is able to get the Haqqanis to engage in certain activities for 

them, but it would be a stretch to say that they control them or 

that they trust each other. 

I think that this is an organization that has a number of 

vulnerabilities that could be exploited if there is a systematic effort 

to attack their financial infrastructure. Among other things, this is 

a very small and centralized network at the top. Last month, an 

air strike killed Badaruddin Haqqani, the operations chief of the 

network. Earlier this year, U.S. forces captured Hajji Mali Khan, 

one of their leading commanders. Last year, a drone strike killed 

Jan Baz Zadran. I believe that the network will start to really 

crumble if they suffer many more high level losses like that. However, it is going to be very difficult to get to some of those people 

30

because they are not in Afghanistan. They are not even in the tribal areas. They are hiding deep inside Pakistan. 

One of the things I had the opportunity to do with this report 

I did with CTC was to go through documents that are inside the 

military’s Harmony database. We went through thousands of documents pertaining to the business side of the Haqqanis that had 

been seized from their safe houses and pocket litter that was found 

on commanders and fighters that had been captured. One thing 

that was very striking when we laid out all of those receipts and 

documents and payroll records and property records that they had, 

was the extent to which the Haqqanis are really a Pakistani organization. The only receipts we found from Afghanistan were from 

petrol stations. Their ID cards, their residences, their hospital bills, 

everything they purchased, the command and the control of this organization is in Pakistan and not in the FATA or not in the tribal 

areas, deep inside Pakistan, records that extended down into Karachi, into Lahore, Rawalpindi. And I think it is important to recognize the extent to which this network is integrated through the region. We also know of extensive property holdings in the UAE, 

Shargah, Dubai, and Abu Dhabi. And I think that there is growing 

awareness in the Emirati states that groups like the Haqqanis, because of their involvement in narcotics and other organized crime, 

are a threat to stability there too. 

So I feel like as we move forward, one challenge is going to be 

for U.S. diplomats and military attaches to work with our counterparts in Pakistan and the UAE and other parts of the Gulf to raise 

awareness of the threats that this and other groups like them pose. 

A designation, to me, is like an arrest warrant. It can be completely meaningless if there is not action to follow it up. And I hope 

that Congress and the committee members here today encourages 

the administration to follow up by creating a task force of financial 

and fraud investigators, logistical and supply chain experts, intelligence and law enforcement officers, and subject matter experts to 

spend say 4 or 5 months really mapping out the financial side of 

this network and figuring out where the vulnerable nodes are and 

what authorities we have to attack it. 

This has been done before in operations against the Cali cartel, 

the Medellin cartel, more recently, La Familia Michoacana in Mexico. There is an ongoing operation against Hezbollah which has 

been tremendously successful. We can do this. It is a question of 

the political will to follow it up and properly resource the investigators and the experts we have here in Washington and in places like 

Tampa who can do this. 

There is an old Robin Williams joke that divorce is like tearing 

a man’s heart out through his wallet. And I always make the comment that I think increasingly when we are facing nonstate adversaries, irregular warfare is going to be like tearing their hearts out 

through their wallets. They don’t have infrastructural facilities 

that we can go after to try and weaken them. To really degrade 

their capacity to project force, we are going to have to go after their 

financial assets. Left in place, I fear that this group is in a strong 

position to take control of the territory in southeast Afghanistan 

and down into North Waziristan and parts of the FATA and I believe that they will continue to provide safe haven and to facilitate 

31

the activities of other militant and terrorist actors who seek to do 

the United States harm. 

Thank you very much. 

[The prepared statement of Ms. Peters follows:]


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Mr. ROYCE. And I thank you for that testimony. But I would assume you would add to that that it would be impossible to negotiate any kind of an arrangement for Afghanistan with the 

Haqqanis that wouldn’t end up being an embarrassment and a 

threat frankly to the United States long term. 

Ms. PETERS. As a former journalist, I covered efforts to negotiate 

with a variety of branches of the Taliban since 1996, back to the 

days when they blew up the Bamiyan Buddhas, about 28 efforts by 

the U.S. State Department to get the Taliban to hand over Osama 

bin Laden, and a number of peace deals that the Pakistan Government made with the Pakistani Taliban and the Haqqanis and others. They always fail. I don’t believe that reconciliation is possible 

with these organizations. And there are clear indications that, as 

in the past, they hope to get what they can out of reconciliation efforts, to get us to release prisoners back to them and then not hold 

up their end of the bargain. 

Mr. ROYCE. So instead, cut off the resources is your point. And 

I believe you stated it very, very well. 

One of the other observations is that this particular organization 

manages to run a lot of these Deobandi schools or particular 

madrasas, which are Deobandi madrasas. And out of these schools, 

as I think you note, the graduates manage to replace the losses if 

they lose about 150 fighters a month. That comes right out of the 

graduates of the school system. 

Ms. PETERS. Absolutely. 

Mr. ROYCE. One of the questions I would ask you, because I have 

been in Pakistan three times petitioning the government to try to 

get them to close these particular Deobandi schools. First, why 

won’t they close them? And second, is it true that some of the resources to maintain these schools come from the Gulf states? Or do 

you think that the revenue is now generated for the Deobandi 

schools internally through the graft and corruption and kidnapping 

and so forth? 

Ms. PETERS. I haven’t specifically looked into funding of the 

Deobandi madrasas but I do believe—and I know that historically, 

a lot of the funding for them came from the Gulf states and that 

funding Islamic education was a popular place for wealthy Arabs 

to send their money in Pakistan. 

Some of these schools—I have been to the Haqqania mosque in 

Akora Khattak on a number of occasions. This is where Jalaluddin 

Haqqani trained and where he took his name from. It has at any 

given time about 10,000 to 15,000 students. It is an enormous compound. And there are I believe about 10,000 madrasas across Pakistan. Not all of them bad. 

Mr. ROYCE. But we are talking now about these particular 

Deobandi schools, which is what I want to focus on because we 

have a list of the ones that purportedly churn out the fighters. We 

know from some of the messaging that goes on in these schools 

which ones are doing it. So does the government in Pakistan. 

So my question to the witnesses here is what happened to the 

political will to shut down these particular schools? We have been 

up to see schools that have been set up—public schools to compete. 

And the Haqqanis come in and blow those schools up. And yet 

there is no effort to close down the very schools that frankly repVerDate 0ct 09 2002 11:45 Oct 17, 2012 Jkt 000000 PO 00000 Frm 00042 Fmt 6633 Sfmt 6633 Y:\WORK\TNT\091312\75860 HFA PsN: SHIRL
39

resent a threat to the state, to the Pakistani Government itself. 

Why not? What is the intimidation or whatever it is that prevents 

that from happening? And I will ask each of the witnesses their 

view. 

Mr. DRESSLER. Sir, I think from the Haqqani perspective and 

from the view of elements of Pakistan security services, the recruits and the fighters that these schools are churning out are 

going to work for the Haqqani network, are going to work for the 

Quetta Shura Taliban. And as long as those organizations continue 

to be supported by elements of the security services, both current 

and retired, in pursuit of their strategic objectives in Afghanistan, 

then it would be counterproductive for them to go after these 

madrasas. 

And of course your point that some of these fighters are being 

turned against the Pakistani state is exactly the point and is exactly the danger of sponsoring proxy groups for the exportation of 

terror. And I think Gretchen mentioned this during her oral testimony, that ultimately this can go bad for the state. And it is a reason why I think yourself and others have highlighted this as a 

problematic policy. So that is what I would say. 

Mr. ROYCE. Ms. Curtis. 

Ms. CURTIS. Yes. Pakistan’s policy of relying on violent militants 

for strategic objectives goes all the way back to the partition of the 

subcontinent. So this is a problem with the thinking within the 

military establishment in particular. There is a perception that 

these motivated Islamist fighters serve a purpose for Pakistan. So 

that is why they are not shutting down these groups. 

Now there may be some thinking that is starting to evolve, some 

concern that a Taliban-dominated Afghanistan would actually not 

be good for Pakistan. A lot of the Pakistani soldiers who are fighting in the tribal areas and dying, some of those commanders may 

be waking up to the fact that these groups are a threat to the Pakistani state. But we have not seen that overall shift that we have 

been looking for within the senior Pakistan military leadership. 

And that is why in my testimony, I have indicated that we have 

to be willing to step up the pressure to help them understand that 

they need to do what is in their own interest because they simply 

have not been able to overcome the fear that they will be subsumed 

by India, and so I think it is really a problem with the thinking 

within the military establishment. 

Mr. ROYCE. Let me conclude my questions with one point relating back to a point that Ms. Peters made in her written testimony, 

which was that the degree of extortion that occurs here impacts 

also contractors that are working in this geographic area. And on 

that subject, if that extortion is netting tens of millions of dollars 

for the Haqqani network, what types of requirements on U.S. contractors should be deployed in your opinion in this circumstance in 

order to be part of the solution in terms of cutting off the valve or 

the resources that goes into the Haqqani network? 

When you could put a halt immediately on U.S. aid into those 

areas, that would be the most direct and swift way to put an end 

to the possibility of getting resources towards—for that type of extortion on U.S. contractors. But go ahead. 

40

Ms. PETERS. And that is what I wrote in my testimony. I am 

often asked what the U.S. Government could do to affect the 

amount of money reaching the Haqqanis. And I always say that 

there is something we could do that would affect it tomorrow and 

that is stop the development and CERD aid that is pouring into 

those areas. It is well intentioned but it is not well monitored. We 

are putting too much money out there. And I think there is a very 

big risk that we are doing more harm than good, that we are fueling instability and funding the very adversaries that we seek to defeat. 

The trucking issue that you appropriately zero in on is trickier 

because we still need to supply our troops who are there. I would 

suggest that there is a far too complex a system of contracting and 

subcontracting and subcontracting of trucking companies, and we 

should find trusted entities that we work with who carry goods 

from Karachi to their end state sealed, where the payments get 

made into—where there is a capacity to follow the money instead 

of what we have now: Where we pay Pakistan’s National Logistic 

Cell a lump sum every year and it is very hard to follow. 

There was an investigation, in fact, done by Pakistan’s own Federal Board of Revenue into the container scandal that included—

it was thousands of containers that went missing. So this is also 

a concern to certain parts of the Pakistani state, that they are not 

collecting revenue on a lot of the stuff that is moving across. 

Mr. ROYCE. Let me just make one observation. I have been up 

to the Northwest Frontier and in these areas around Peshawar and 

so forth. Our USAID employees do not go out because it is too dangerous for them. So the thesis that we are going to have effective 

monitoring is unrealistic. And that is why I think you get back to 

the other broader assumption that programs in these areas are 

going to be subject to extortion. And so the tougher decision is coming face to face with reality that this is providing tens of millions 

of dollars. The cause is a good cause, but it is not having the desired results, and therefore, we have to develop a different approach. 

I think the focus should be on the recommendations and the type 

of recommendations, Ms. Peters, that you made here today and 

that your colleagues here have made. 

I am going to go to Mr. Sherman, the ranking member, for his 

questions. 

Mr. SHERMAN. Thank you. A couple of comments. One is that we 

ought to be doing as much as we can to aid education in Pakistan 

and particularly to make sure that parents don’t have to pay for 

the textbooks. If we pay for the textbooks, they may not be politically correct by U.S. standards but they won’t have, you know, 

chapters in favor of extremist jihad. 

The second thing I will point out is that by having 85,000 or 

more troops in Afghanistan, we require ourselves to have this huge 

logistical effort which means the enemy will live off our logistical 

effort. If we have fewer troops, we would have less logistics and 

hopefully much of that could be supplied through the northern 

route. We can’t just look at what is the cheapest way to bring supplies into Afghanistan. If it costs 150 percent as much to move 

them through Russia but we know that none of the money is going 

41

to the Haqqani network, every dollar that goes to the Haqqani network probably does us as much harm as $5 or $10 or $15. 

Ms. Peters, do you have any kind of rough pie graph as to where 

the Haqqani network gets its money? That is to say, they have got 

donations. They have got money coming in from the ISI and other 

elements of the Pakistani Government. They have got drugs. They 

have got a protection racket. Then they have got kidnappings for 

hire, and then they have things approaching legitimate businesses, 

where they are competing against those. Any idea what are the big 

elements there? 

Ms. PETERS. My feeling is that the big sources of income are extortion, the construction and real estate operations that they run, 

and kidnapping. But that is my feeling. It is very, very hard to——

Mr. SHERMAN. So it is not so much drugs or aid from the ISI? 

Ms. PETERS. I think the Taliban in the southwest earn a lot more 

money from narcotics than the Haqqanis do, although what is interesting about the Haqqani network is they appear to have gotten 

more involved in the business of importing precursor chemicals, 

specifically acetic anhydride, which I thought was very interesting 

and innovative of them because there is now such a glut of opium 

in parts of the south that per kilo the value of acetic anhydride is 

actually higher. So they actually earn more money——

Mr. SHERMAN. What is that chemical used for? 

Ms. PETERS. Acetic anhydride is the critical ingredient along 

with lime and hydrochloric acid and a few other ingredients to 

process raw opium into—lime and hydrochloric acid to take it up 

to a morphine base, more or less. I am simplifying a little bit. Acetic anhydride is critical——

Mr. SHERMAN. So they got into the drug dealer’s supplier? 

Ms. PETERS. That is correct. Acetic anhydride is the critical element that turns it into crystal heroin, the most addictive and most 

valuable——

Mr. SHERMAN. So what we are finding is being done in Pakistan 

and Afghanistan, not——

Ms. PETERS. The refineries are mostly in southern and southwest 

Afghanistan. Some of them are in eastern Afghanistan in the border areas. And we hear sporadic reports of refineries opening in the 

tribal areas. And some are up on the border between Iran and Turkey. 

Mr. SHERMAN. I got you. Now one thing that I think we were inadequately sensitive to throughout our involvement in Afghanistan 

is how it is absolutely unacceptable to Pakistan—and naturally 

so—that Afghanistan would become a strategic enemy or a base for 

the Indian military. To what extent is Pakistan justifiably afraid 

that Karzai could be a strategic ally of India and a strategic enemy 

of Pakistan? And to what extent is there justifiable fear looking at 

the entire Kabul government as a whole? 

Does anybody have a comment? Mr. Dressler. 

Mr. DRESSLER. Congressman, I think it is overstated the extent 

that there is Indian influence in Afghanistan. I mean certainly they 

have diplomatic influence and——

Mr. SHERMAN. Whatever influence they have will be multiplied 

by 10 in the minds of Pakistani generals. So we have to make sure 

it is a pretty low number. 

42

Mr. DRESSLER. Yeah. I mean, I don’t expect that they will be 

mounting an invasion from Afghanistan into Pakistan. I think that 

is very far from reality. So that concern is unfounded. Certainly 

there is activity. And President Karzai, one of his strategies is to 

leverage all elements of regional competitors against each other. 

And that is simply what he is doing when it comes to——

Mr. SHERMAN. So instead of assuring Pakistan that he is not an 

ally of India, he threatens Pakistan that maybe he will be? 

Mr. DRESSLER. [Nods yes.] 

Ms. CURTIS. I don’t think we should look at Afghanistan as a 

zero sum equation between Pakistan and India. We need to be 

looking at Afghanistan as becoming a stable country that will not 

serve as a safe haven for terrorists. And if you look at the kind of 

assistance that India is providing, there is a lot of humanitarian 

assistance. They have helped build the Parliament building. They 

are supporting democracy. These are all——

Mr. SHERMAN. I think we need to see this through the eyes of 

those concerned with Pakistani national security. 

Ms. CURTIS. Okay. We can do that. But I don’t think we have 

seen any evidence of efforts by India to directly undermine Pakistani national security. This is something that the Pakistanis fear. 

But I don’t think that we should let U.S. policy be driven by Pakistani fear. I think we should point out that if Pakistan is worried 

about Afghanistan getting too close to India, then it needs to take 

steps to build its own relationship with Afghanistan because what 

Pakistan is doing, by supporting militants, it is not currying favor 

with the Afghan people. So if it wants to have a better relationship 

with Afghanistan, it needs to engage in normal state activities that 

allow that. 

Mr. SHERMAN. I think you are assuming that the average 

Afghani is on our side and not the Haqqani side. And I would very 

much like to believe that, and I am sure it is true of a large number of Afghans. But to say that they are not currying favor with 

the Afghan people ignores just how powerful the support network 

of the wrong side is in Afghanistan. Of course the Afghans we meet 

in our daily lives are all more reasonable than what you see on the 

ground. 

I think my time has expired. 

Mr. ROYCE. Thank you. Mr. Connolly from Virginia. 

Mr. CONNOLLY. Mr. Chairman, I thank you. But let me just, if 

it is all right with the chair, I would be happy to yield to our colleague, Ms. Jackson Lee, if she has some questions at this point. 

Mr. ROYCE. Ms. Jackson Lee, go ahead. 

Ms. JACKSON LEE. Mr. Connolly, thank you so very much for 

your courtesies. And let me thank the ranking member and the 

chairman for their courtesies as well. I think this is an important 

hearing. I apologize for being delayed somewhat in another hearing 

that we are addressing. 

Many of us are familiar with the Haqqani network, and certainly 

through the passage of legislation out of this committee, the criteria was set in place for the State Department to ultimately make 

a determination. But I want to pose several questions regarding 

the extension between the Pakistani people, the military brass, and 

43

the Haqqani network which I think is tied mostly to the intelligence agency. 

So my first question would be, do you not see any divide or any 

light between the network and some of the military brass in the 

Pakistani military service? Second, are you suggesting that the 

Haqqani network is representative of the people of Pakistan and 

that there are not some viable routes of collaboration with the 

United States and opportunities for mutual cooperation? And third, 

are you aware that in spite of the obstacles that the present Pakistani Government has to overcome—and that is living in a very 

dangerous neighborhood and a very challenging climate—are you 

aware of the recent engagement that Pakistan has had with India 

opening up new trade routes, opening up cooperation, India becoming one of the major trading partners for Pakistan and actually evidencing some real desire for that country to tend to the business 

of normalization so that—is there not some divide or light between 

the Haqqani network and Pakistan? What happens is that they are 

interpreted as the same. When you take a broad brush, I think it 

is unfair. As Americans, we never are reminded of the fact that 

Pakistan stood alongside of us in the 20-year war, as I understand, 

against Russia’s presence in Afghanistan. So I would like to save 

Pakistan. And I don’t argue with the designation. But I do think 

we should be clear that there is some distinctions. 

So those who are on the panel can respond to the questions. 

Thank you for your testimony. 

Ms. PETERS. Ma’am, I thank you for your comments. I have spent 

a lot of my adult life living in Pakistan among the Pakistani people. And I have a great deal of affection for that country and for 

the communities there, particularly in the border areas. There is 

a huge divide between the communities and these very violent and 

thuggish and criminalized forces that are wreaking havoc on the 

people. I met with a group of businessmen in fact from North 

Waziristan last year in Dubai who were asking me about the reconciliation strategy and said, why are you speaking to the 

Haqqanis? Why is your government trying to talk to them? Why 

don’t you come and speak to us? We are the doctors and the lawyers and the educated people from the border areas. We would like 

to reconcile with you and be partners with you. And that is a 

strong feeling I have from across Pakistan, that the people are by 

and large moderate, that they want to be friends with us and other 

countries around the world. I would even go so far as to say that 

that is true of a lot of people within Pakistan’s bureaucracy and 

even their military and intelligence services. Like our military and 

intelligence services and bureaucracies, there are a lot of different 

groups and they don’t always get along. 

Increasingly, public polling has showed that public support for 

militancy has plummeted in recent years because of the widespread 

terrorist violence, the kidnapping that is going on, the criminal activities that these organizations engage in. I am not saying that the 

United States has become wildly popular. However, there is certainly no love lost for the militants in that part of the world. I also 

think that public polling and surveys show that people on both 

sides of the Line of Control—people in India and Pakistan—would 

like to see more economic cooperation, like the trade agreement 

44

that you speak of. They would like to see their region become sort 

of like a South Asian ASEAN, if I could put it that way. 

This is one of the most populous regions in the world with a lot 

of cultural affinity because it used to be, of course, one country. 

And I think that there is a way forward. And I personally hope 

that we can go down that road in the next decade. 

Ms. JACKSON LEE. Anyone else? Thank you very much. 

And would you include in your answer whether or not our actions should be punitive against the people in the government in 

light of your comments, Ms. Peters? 

Ms. PETERS. My feeling is——

Ms. JACKSON LEE. No. Let me get a response from Mr. Dressler 

and Ms. Curtis. If we have time, Ms. Peters, I would love to hear 

you because you have lived among them. 

Mr. DRESSLER. I think it is a fair point. It absolutely should not 

be punitive against the Pakistani people. I think the problem is 

that there are a select few who are not allowing the Pakistani people to rise up against these groups to voice their opinions and to 

basically say, look, we don’t agree with this policy of having a terrorist safe haven in North Waziristan for a variety of groups. 

And your point about the Pakistan-India relationship potentially 

getting better is a great one but it is one that is directly undermined by elements of the security services’ support for groups like 

Lashkar-e-Taiba and others. 

So I would just echo Ms. Peters’ comments about the Pakistani 

populace. It is really not about punishing them. It is about encouraging or compelling elements of the security services to cease their 

support and facilitation for these groups. 

Ms. JACKSON LEE. Ms. Curtis. 

Ms. CURTIS. Yes. I agree wholeheartedly with what Mr. Dressler 

just said. And I would just add that I bet if you talk to most Pakistanis, they would actually support this designation of the Haqqani 

network as a terrorist organization because they realize the threat 

that this network poses to their country. 

And here I would like to quote Asma Jahangir. She is a well 

known human rights defender in Pakistan. And just about a month 

ago, she exhorted her fellow countrymen in an article to fully—and 

I am quoting here—‘‘fully comprehend, admit and face up to the 

challenges thrown at the country by militant non-state networks,’’ 

noting that the country’s leaders were conceding territorial and political ground to jihadis of all types and nationalities. So clearly 

there are many Pakistani people who do not support these militant 

networks, who would like to see their country more stable in confronting these networks. 

So I think you are absolutely right. We should not be penalizing 

the Pakistani people. We should be engaging, trying to build a relationship but at the same time trying to make sure that those linkages between some elements of the Pakistani state and militant 

nonstate networks are broken. 

Ms. JACKSON LEE. Mr. Chairman, may I just conclude, I didn’t 

know whether you would indulge Ms. Peters. I don’t know if she 

has something different to say from these two. I cut you off, and 

I didn’t know if you had something different to say. 

Ms. PETERS. No. I agree broadly with what they have said. 

45

Ms. JACKSON LEE. Mr. Chairman, if I might just conclude. And 

thank you for your courtesies. 

I co-chair the Pakistan Caucus. And the only thing I would like 

to say to this committee, I agree with the designation of the 

Haqqani network and do believe there are elements in the ISI and 

others. But it would be wrong for us to disengage with Pakistan. 

People are more than desirous of a legitimate democratic country 

but, more importantly, a relationship I believe with the United 

States. We have got to find a way to be collaborative on this war 

on terror. 

I thank the chairman very much and I yield back. 

Mr. ROYCE. Thank you. 

Ms. JACKSON LEE. And I thank the gentleman from Virginia. 

Mr. ROYCE. Thank you, Congresswoman Jackson Lee. We now to 

Congressman Connolly from Virginia. 

Mr. CONNOLLY. Thank you, Mr. Chairman. And again thank you 

to our panelists for being here. 

A real quick question, Ms. Peters, and a follow-up to your answer 

to Mr. Sherman on the heroin question. That is obviously a major 

source of the financing for the Haqqani network—by the way, ironically, some of it—a lot of it coming from Iran which has, I guess, 

the largest number of heroin addicts in the world. 

Ms. PETERS. Opium addicts. 

Mr. CONNOLLY. Opium. Excuse me. And the United States and 

Iran actually might have something in common there, the desire to 

fight the traffic. 

Ms. PETERS. Yes. That is correct. 

Mr. CONNOLLY. What other sources of financing does the 

Haqqani network have externally? 

Ms. PETERS. External sources? 

Mr. CONNOLLY. Externally. 

Ms. PETERS. Well, they partner with a number of import-export 

operations that extend as far away as South Africa and that are 

sort of located throughout the Gulf. They have fundraising operations throughout the Gulf states and the Emirates. 

Mr. CONNOLLY. Are they receiving direct funding from states? 

For example——

Ms. PETERS. I believe they continue to receive direct funding and 

certain types of logistical support from parts of the ISI. I also believe that the Haqqanis are helping to——

Mr. CONNOLLY. What about Iran? 

Ms. PETERS. Well, I was just going to say, I believe that—it is 

known that there is a growing operation to bring Iranian dinars 

and other regional currency, Saudi rials, Emerati dinars into southeastern Afghanistan to flip them on the hawala markets, flip them 

in the money exchange markets into U.S. dollars because there is 

a wealth of dollars. And I have received multiple reports during the 

course of my research that Haqqani operatives act as gunmen protecting those convoys with cash that are coming through. 

Mr. CONNOLLY. Thank you. Mr. Chairman, I think as a followup to this hearing, one of the things we are going to have to be 

in touch with the State Department about is, now that it has been 

accorded an FTO, we need to be looking at sources of financing, especially if they involve other sovereign states directly or indirectly. 

46

Mr. Dressler—and maybe Ms. Curtis—what should we understand about the relationship between the ISI and the Haqqani network? And to what extent should we hold the Pakistani Government qua-government responsible for that relationship of protection? 

Mr. DRESSLER. Sir that is an excellent question. I think just to 

piggyback on Ms. Peters’ answer about the financing, you are coming up into the Hajj year toward the end of October and you can 

bet that there will be Haqqani network representatives there fundraising and collecting money. So this is really a time-sensitive issue 

as well. 

Mr. CONNOLLY. When you say ‘‘there,’’ you mean Mecca, correct? 

Mr. DRESSLER. Correct. In terms of holding the Pakistani Government responsible, you really have to look at the relationship between the Pakistani Government, the PPP government and the 

military and who controls what and who has influence over whom. 

When you peel back that relationship, I think it becomes pretty 

clear that the PPP government is probably fairly limited in terms 

of what they can do against the Haqqani network. When it comes 

to the relationship between elements of the ISI and the Haqqani 

network, it really runs the gamut. I think there is current and retired is typically the way that you hear it phrased in the media. 

And in a classified hearing, you could probably get you know perhaps a little bit better fidelity on that relationship. But sufficient 

to say that there is an element of support there that has endured 

over the past 30 years, as Gretchen mentioned in her testimony. 

This is a longstanding relationship. And as long as the Haqqanis 

are roughly pursuing the same objectives in Afghanistan as the 

Pakistani security services then that relationship will continue unless somebody forces it to be broken. 

Mr. CONNOLLY. Ms. Curtis. 

Ms. CURTIS. So as Ms. Peters pointed out, the ISI doesn’t have 

complete control over the network but at the same time the network could simply not survive if the Pakistanis were to crack down. 

And if there is any organization in the world that can influence the 

Haqqani network, it is the Pakistan intelligence service. So I think 

that even if they don’t have complete control——

Mr. CONNOLLY. You will forgive me, Ms. Curtis. But I think that 

is being overly generous. The fact of the matter is, the Haqqani 

network operates with impunity in certain parts of Pakistan with 

the absolute knowledge of the ISI, in fact arguably with their protection. They are not under house arrest, right? 

Ms. CURTIS. That is right. 

Mr. CONNOLLY. So it is an open secret what is going on. And the 

real proposition—I guess the question I am asking—and I understand that it is difficult—but presumably, there is one government. 

And if we want to accept the proposition that while in the case of 

Pakistan, it is a multiheaded hydra and what can we do, then we 

are going to have to accept the proposition, which I find unacceptable, that the Haqqani network is going to continue to operate with 

impunity in Pakistan and across the border with the protection of 

an arm of the Pakistani Government. It seems to me we have to 

wrestle that issue to the ground if this relationship with the Government of Pakistan is to proceed in any kind of healthy normal 

47

fashion. It is an unacceptable proposition to our Government and 

ought to be. And I think we have just made it even less acceptable 

with this long desired designation. 

And that is really what I am asking you to respond to. You can 

certainly disagree with my proposition if you wish. But from my 

point of view, there are some serious truths here that have to be 

dealt with. 

Does anyone on our panel take issue with my characterization 

that the Haqqani network operates with impunity inside Pakistan 

and across the border and with the protection of the ISI? 

Ms. CURTIS. No, sir. I agree with you. 

Mr. DRESSLER. I don’t take issue with that either, sir. 

Ms. PETERS. I don’t take issue with that either. I think the relationship is not always smooth but——

Mr. CONNOLLY. I have been married 36 years. My relationship 

isn’t always smooth. 

Ms. PETERS. Exactly. It is like a marriage. 

Mr. CONNOLLY. I appreciate the point. But yeah. But one final 

question, if I may, Mr. Chairman. What is your understanding—

given the fact that we are drawing down from Afghanistan and the 

fact that we had the attack in Kabul, active participation by 

Haqqani, what does it mean once we are gone in Afghanistan in 

terms of the broad playing field for Haqqani and what we might 

expect from them in the Afghan theater? 

Mr. DRESSLER. Just briefly, sir, I think the concern is that the 

Haqqani network, the threat from the network inside of Afghanistan is not sufficiently addressed either by us or that the Afghan 

security forces are not capable of addressing the threat and that it 

grows and it spreads as it currently is and that at that point these 

relationships that persist in North Waziristan will eventually make 

its way even in greater strength than it currently is in Afghanistan 

so you will have safe havens in Afghanistan with al-Qaeda. So basically replicating what you see in North Waziristan throughout 

areas of Afghanistan. 

So it is a fair point, and I think a counterterrorism footprint 

after 2014 certainly is a start. But whether or not it is going to be 

sufficient is a difficult question. There is ISR, a lot of other things 

that need to be there. And it is very difficult to retake a district 

center with a fighter plane or something like that. So I mean it is 

a concern for sure. 

Mr. CONNOLLY. Mr. Chairman, thank you. 

Mr. ROYCE. Thank you, Mr. Connolly. We want to thank our witnesses for coming down and giving their testimony today. We are 

going to be following up with you on some of the suggestions that 

you made today at this hearing. 

Our hearing stands adjourned. 

[Whereupon, at 4 o’clock p.m., the subcommittee was adjourned.] 

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