Nuclear Blackmarket and Pakistan

    The least reported link in the otherwise raging controversy over Pakistan¿s nuclear proliferation happened on January 1, 2004, at the Denver International Airport. Asher Karni, 50, a Jewish businessman from South Africa, was snared in a sting operation launched by the US Commerce Department and other federal agencies.

    The least reported link in the otherwise raging controversy over Pakistan's nuclear proliferation happened on January 1, 2004, at the Denver International Airport. Asher Karni, 50, a Jewish businessman from South Africa, was snared in a sting operation launched by the US Commerce Department and other federal agencies. The allegation against him was that he was involved in selling 400 spark gaps to a firm in Pakistan run by an arms dealer. Spark gaps are electrical devices used in breaking kidney stones and in triggering nuclear detonations. <br /> <br /> What had put the federal agencies on the trail of Karni was the elaborate subterfuge employed by him and the customer in camouflaging the deal. Karni owns Top-Cape Technology in Cape Town, South Africa, a firm dealing in military and aviation electronic equipment. Last year, he was contacted by Pakland PME (2nd Floor, Muhammadi Plaza, Jinnah Avenue, F-6/4, Blue Area, Islamabad) for buying spark gaps from PerkinElmer Optoelectronics, Salem, Massachusetts. A sales brochure of PerkinElmer describes spark gaps as useful ``for in-flight functions such as rocket ignition, warhead detonation and missile stage separation''. But PerkinElmer told Karni that the sale would require a US licence. Karni decided to adopt a more devious method. He subcontracted the deal. He asked Giza Technologies of Secaucus (600 Meadowlands Parkway, Suite 19 Secaucus, NJ 07094, US A) to buy 200 spark gaps from PerkinElmer. He said the spark gaps were meant for a hospital in South Africa, Chris Hani Baragwanath Hospital, Soweto. The spark gaps were received by Karni at South Africa who repackaged them and dispatched them to Pakland PME, Islamabad. <br /> <br /> The deal wouldn't have attracted the attention of the intelligence agencies but for the antecedents of the owner of Pakland PME. It is owned by businessman Humayun Khan, known to be a regular supplier of military hardware to Pakistan military. Some of the emails intercepted by the agencies only confirm his linkages with the military establishment in Pakistan. These mails, produced in the US District Court, Columbia, where Karni's bail was decided early January, showed Khan discussing the possibility of buy infra-red sensors for jet fighters. The court affidavit said: ``This case represents one of the most serious types of export violations imaginable. Karni has exported goods that are capable of detonating nuclear weapons to a person he knows has ties to the Pakistani military.'' <br /> <br /> Karni is the latest link in the wide and expanding network of nuclear blackmarket which has been exploited by Pakistan over the years to develop its nuclear weapons development programme which, incidentally, has not really been as secretive as is being made out by the western media. It was the Dwight Eisenhower's Atoms For Peace Programme in 1958 which gave Pakistan the impetus to embark on a nuclear development programme. The first light water research nuclear reactor was, in fact, set up with the help of the US. Pakistan was given a grant of $3,50,000 for the reactor. Though not much is known about the progress Pakistan made in the development of its nuclear programme, there is clear evidence that Pakistan had already begun tapping the nuclear blackmarket. This became evident in a secret note prepared by the US State Department a decade later. The note (since declassified) titled Pakistan and the Non Proliferation Issue pointed out that Pakistan was negotiating with Belgians for a heavy water facility, with the Canadians for a fuel fabrication plant and with the French for a chemical separation plant. The note cautioned that these facilities would ``give Pakistan a virtually independent nuclear fuel cycle and the opportunity to separate a sufficient amount of plutonium to build a nuclear weapon.'' <br /> <br /> There is irrefutable evidence that Pakistan either tapped the nuclear blackmarket or persuaded governments to make illegal deals Pakistan set up a number of shell companies, both within Pakistan and abroad, employed a network of agents and smugglers in Germany, France, Switzerland, Sweden, Canada and the United States to smuggle, steal and trans-ship dual purpose materials. Pakistan got a Canadian firm, Canadian General Electric Co., to complete the 137 MW CANDU power reactor for the Karachi Nuclear Power Plant in 1971. A British firm, British Nuclear Fuels, designed the plutonium separating facilities; a Belgian firm, Belgonucleaire and a French corporation, Saint-Gobain Techniques Nouvelles, designed the pilot reprocessing facility called the New Labs at PINSTECH. In 1976, under a highly secretive project codenamed 706, Pakistan bought components for centrifuges from the Netherlands; orders for 6500 tubes of specially hardened steel were placed with Van Doome Transmissie. Other support components and subsystems were bought from Vakuum Apparat Technik (high vacuum valves) of Haag, Switzerland and Leybold Heraeus ( gas purification equipment), Hanan, Germany. A year later, the British subsidiary of Emerson Electric sold 30 high frequency inverters to Pakistan for controlling centrifuge speeds. <br /> <br /> So extensive was Pakistan's dealing with West German firms, for instance, that in1989, well known German magazine, Stern, wrote ``since the beginning of the eighties over 70 (West German) enterprises have supplied sensitive goods to enterprises which for years have been buying equipment for Pakistan's ambitious nuclear weapons programme.'' First the official deals. The Federal Economics Office in Eschborn approved the export of an electronically controlled milling machine from a Munich firm, Friedric Deckel AG. The machine was used in the production of elements of a nuclear explosive system. The German government also approved the sale of special press to compact hard metal powder by Dieffenbacher GmbH, Eppingen in 1985. The Karlsruhe Nuclear Research Center not only supplied a mass spectrometer, an equipment used in determining the degree of uranium enrichment, to PAEC but also trained Pakistani scientists. <br /> <br /> It is no less important to know the story of Richard M. Barlow, a CIA career officer whose brief was to monitor Pakistan's nuclear programme. In 1987, he discovered that US firms were not only involved in selling Pakistan dual-use equipment and materials, the government was not really keen on letting the US Congress know about the true picture. When he protested, he was forced to resign. He later joined as an analyst with the Office of the Under Secretary of Defense for Policy from where too he had to resign under pressure after he raised strong objections to the administration's continued support to Pakistan's nuclear purchases in the US. <br /> <br /> However, fearing exposure, the Pakistan Atomic Energy Commission (PAEC) quietly began employing nuclear traders and agents to buy materials and equipment otherwise banned by the US and international conventions. For instance, PAEC bought a tritium purification and production facility with a capacity to produce 10g of tritium daily in 1987 from a West German firm, NTG Nukleartechnik GmbH. Tritium can be used to produce a thermonuclear device. The deal was struck with the help of a known nuclear trader, Alfred Hempel. Interestingly, it was NTG which procured 7000kgs of fuel cladding material from India and shipped it to the Karachi Nuclear Power Plant via Germany falsely marking the consignment as ``stainless steel tubing``.Hempel, according to a German government report, had also negotiated with another firm, Ventron GmbH, to sell boron carbide, an absorber used in the construction of reactor, to the PAEC. The deal was struck on behalf of the PAEC by Pakland Corporation, a name intriguingly similar to the one owned by Humayun Khan who bought spark gaps from Karni in 2003. Another agent employed by PAEC was a former Brigadier in the Pakistan Army, Inam ul -Haq, who was caught buying 30 metric tones of aluminium tubing for a firm in Lahore, Multinational Corporation. A third agent employed by PAEC was Sulfikar Ahmed Butt whose identity was discovered when he tried to obtain 50 cryptons from EG &amp;G Inc. Wellesley, Massachusetts. He was known as the chief buyer for the bomb makers in Pakistan. The Pakistan Ambassador posted at Bonn facilitated these deals. <br /> <br /> Brigadier Haq was financed by the Bank of Credit and Commerce International (BCCI) set up by a Pakistani financier, Agha Hasan Abedi, a known arms dealer. The BCCI, as investigations later proved, was a front organization floated by financiers, smugglers and intelligence agencies of various governments including the CIA to launder money, supply arms to terrorists, insurgents and rebels at different hotspots across the world. In a report prepared for the US Senate on the BCCI in December 1992, Senators John Kerry and Hank Brown said one of the areas that required deeper investigation was ``the extent of BCCI's involvement in Pakistan's nuclear program. There is good reason to conclude that BCCI did finance Pakistan's nuclear programme through the BCCI Foundation in Pakistan as well as through BCCI-Canada''. <br /> <br /> Brigadier Haq was not the only agent to be financed by the BCCI. In 1987, the BCCI funded two Americans, Rita and Arnodl Mandel to buy $1 billion worth of oscilloscopes and computer equipment for Pakistan's nuclear programme. The same year, the bank had paid a huge amount to Ashad Pervez, a Pakistani-born Canadian, to buy specialty steel and metal used to speed up nuclear explosions. The report said the BCCI gave $10 million to a private science and technology institute which was headed by Dr AQ Khan. There is ample evidence that Dr Khan too had employed agents and intermediaries to sell and procure nuclear materials and technology. A one-page memo from the Iraqi intelligence service (Mukhabarat) dated October 6, 1990, given to the US intelligence by Hussein Kamel, Saddam Hussein's son-in-law who defected in 1995, mentioned a meeting between intelligence officials and a representative of Dr Khan, Malik. Dr Khan, the memo said, offered to give Iraq project designs for a nuclear weapon. Khan quoted a price of $5 million. Similar evidence is available on Dr Khan's deals in North Korea. It is now well known that Pakistan supplied nuclear technology and materials to North Korea for cash and against missile components and technology. An intelligence report in 2002 said ``tens of thousands of dollars `` were deposited into the personal bank accounts of Pakistani scientists working at the Khan Research Laboratory, Kahuta. <br /> <br /> Following the Dr AQ Khan episode, several intelligence and security agencies have once again taken up the clues left uncovered by the US Senate Committee investigations in 1992. The investigators are examining the records of the bank to identify the Pakistani nuclear scientists who were on the payrolls of the bank. One of the persons the investigations are focusing is Mohammad Farooq, one of the nuclear scientists under investigation. Farooq was the contact person between Dr Khan and the Iranians. Farooq, on his part, used Allama Ariful Hussaini, chief of the Tehrik-I-Nifaz-I-Fiqa-I-Jafaeria Pakistan, the largest Shia organization in Pakistan. Farooq was a Director General (Foreign Procurement) at the Khan Research Laboratory when Dr Khan sold centrifuges and other equipment to Iran, once again, through a network of agents-three Germans, a Dutch national and two Muslim Sri Lankan nationals. Investigations have uncovered Dr Khan's trail to Dubai, Turkey, Casablanca, South Africa and Malyasia. He traveled to these destinations on at least 41 occasions-he met North Korean scientists in Malaysia, Libyans in Casablanca and Iranians in Karachi. <br /> <br /> In the third of week of January 2004, the US officials investigating the network air freighted a small box containing warhead designs that were sold to Libya by Dr Khan and his coterie. This was the first hard evidence of the extent of the nuclear blackmarket network operated by Dr Khan. The blueprint, investigators believe, would have fetched $50 million, part of which might have reached Pakistani scientists. <br /> <br /> Dr Khan's Dubai connection is still to be made public. Dubai is a known harbour of transnational criminal syndicates including Dawood Ibrahim. Most of the nuclear components, illegally sold to Libya, North Korea and Iran, were routed through shell companies in Dubai. Considering Dawood Ibrahim's links with arms and drug smugglers, it is possible that his syndicate might have facilitated some of the nuclear shipments for Dr Khan. <br /> <br /> However, it is the Malaysian link that could prove to be crucial in unraveling the global network of transnational criminal syndicates involved in smuggling nuclear materials and technology. According to reports, Khan had gone to Malaysia to attend the wedding of a Sri Lankan businessman, BSA Tahir. Tahir is a nuclear trader. Farooq had engaged Tahir to persuade a Malaysian oil and gas conglomerate to set up a centrifuges component factory in Selangor, Malaysia. The Malaysian factory, Scomi Precision Engineering, refurbished centrifuge components before exporting them to firms in Dubai and elsewhere. Investigators have so far discovered that the Malaysian firm had supplied nuclear components to a firm in Dubai between December 2002 and August 2003. Scomi is headed by Tan Sri Asmat Kalamudddin, a former chief of Malaysia's International Trade Ministry. Incidentally, the largest shareholder in the company is Kamaluddin Abdullah, son of Malayasian Prime Minister Abdullah Badawi. <br /> <br /> E-mail: wjohn@orfonline.org <br /> <br /> <em>* Views expressed in this article are those of the author and do not necessarily reflect those of the Observer Research Foundation.</em>

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