Crime and terror groups are key non-state actors in Karachi and employ crime and violence to achieve political and economic gains. They have a different relationship with the state than crime groups in Italy where the state has more resources to share with the crime groups. Instead, much more complex relationships exist between the state and the non-state actors in this difficult environment where crime and terror groups have become a part of diffuse governance of the city, including provision of housing and water.
Our analysis differs from others who suggest that crime and terror groups have stepped into a power void. We suggest that the political parties rather than the crime and terror groups are at the forefront of violent and criminalized politics. Therefore, violent non-state actors are not the ultimate arbiters of the political order. Crime and terror groups remain vulnerable as they may lose the state’s support and without this they face difficulty surviving in this highly competitive environment.
Megacities are developing across many regions of the world – in particular in Asia, Latin America, and Africa. These cities are growing rapidly as migrants from rural areas or those escaping conflicts gravitate to urban areas. Migrants often settle in informal urban settlements that frequently lack infrastructure and services. In the absence of state presence, or in areas where the state’s presence is substantially weakened, criminals and other non-state actors become the providers of services needed by citizens. Many security specialists write that the rise of criminal groups in megacities presents a critical challenge to global stability. They suggest that poor governance by states and the rise of disgruntled populations in these megacities may result in alternative structures of governance where gangs and warlords assert control over urban territory.
Research in Karachi, a city in which criminal organizations, terrorists and crime-terror groups are all powerful actors, suggests a different reality. Crime and violence are deployed strategically by criminals in Karachi for economic and political gain. Yet they are just one group competing for power in an environment in which every political player is armed and has a stake in the city.
Despite the presence of much intra-personal and politically motivated violence, including high rates of homicide, there is an order in Karachi that is established from the bottom up rather than the top down. This order is not entirely separate from the state but—as this analysis will show—these diverse criminalized non-state actors manipulate the state and are in turn manipulated by the state.
The reason that many fail to see the order that exists in this chaos is that they use Western concepts of nation-building or state formation to analyze the new urban reality of the developing world. Thus they miss the distinctive relationships that exist between state and non-state actors in the megacities of the developing world, of which Karachi is a prime example.
This paper analyzes how criminalized non-state groups are connected to the wider political and economic contexts in which they operate. The relationships between organized crime and the state are different in Karachi from those that exist in Sicily, Italy. Yet the Sicilian context provides the overarching framework for our understanding of crime-state relationships. In Sicily, family relationships determine the structures of criminal groups and votes are delivered to politicians in return for contracts and tolerance of their activities. Criminal groups are loyal to the state and have grown along with the economic development of the Italian state since World War II.
In contrast, in Karachi, non-state actors do not benefit as directly from a parasitic relationship to the state. This is true, in part, because the state has less to give. Moreover, there is less of an exchange relationship between the non-state actors and political structures than in Italy. Rather, much more complex relationships exist between the state and the non-state actors in this difficult environment in which crime and terror groups have assumed many functions that are vital for the survival of citizens, such as the provision of housing and water.
Karachi, a city with a population of approximately twenty million, contributes at least a quarter of Pakistan’s GDP and serves as its primary port. Through its port flow many illicit commodities including drugs, ensuring the centrality of illegal commerce to the economic life of the city, and by extension, the country.
Karachi’s political structure is distinctive in having criminal groups, terror groups (Al-Qaeda, Tehreek-e-Taliban Pakistan (TTP) and Lashkar-e-Tayyaba (LeT)), and crime-terror groups (D-company) as major actors in the political and economic environment of this great port city. Even its primary political party, the Muttahida Qaumi Movement or MQM (party representing migrants) as it is popularly known, is credited for introducing systematic violence and crime to the city’s politics. The centrality of terror groups that finance themselves through crime creates new forces in the urban structure. The terrorists differ from crime groups in that they seek to destroy or fundamentally alter the state. This means that the maintenance of state stability is not a primary objective of their participation in urban politics. This contributes to a unique dynamic of urban governance found in few other megacities and which leads some analysts to believe that Karachi’s violence is a prototype for future conflicts.
Karachi’s informal and violent political order reflects the dramatic evolution in the city over the past seventy-five years. The migration that has contributed to Karachi’s high growth rate is characteristic of development in the developing world but its scale is distinctive. Between 1941 and 1961, Karachi’s population increased by 432 percent; the largest recorded population increase in any city in any given time in history. The drivers behind this increase in urban population include migrants from India who settled in Karachi after the Partition of India in 1947. The city’s population also grew exponentially as a result of migration from rural areas of Pakistan. By the 1970s and 1980s, and in the wake of the Afghan jihad, waves of migrants displaced from tribal areas of Pakistan and adjoining Afghanistan arrived in Karachi in search of opportunities. After the invasion of Afghanistan that followed 9/11, the long decade of military operations in Afghanistan and the tribal areas of Pakistan again triggered subsequent waves of migrants.
Despite being a city built on migration, Karachi was ill-equipped to integrate newer arrivals. The ever-arriving migrants suffered as a result of the city’s limited resources combined with bureaucratic and flawed state policies. This allowed non-state actors including community networks, crime and crime-terror groups, political parties, and individual entrepreneurs engaged in illicit activities to gain a vital stake in service delivery and consequently in the political power of the city. The provision of services, in particular housing and water, for a significant section of the population, and especially the poorest sectors, has become deregulated over time. It is estimated that that almost 41 percent of the water supply to Karachi is siphoned off from bulk distribution and sold in the parallel water market through tankers that supply the poorer areas of the city with water.Similarly, 50 percent of the city’s housing needs are met through the informal sector.
Political parties collaborate with licit and illicit actors in order to gain control of the city’s resources. Power is divided regionally with particular groups having power in particular regions of the city. For example, the poor urban settlement of Lyari is controlled by one of the prime criminal groups engaged in drug trafficking.
The state, to an extent, is complicit in the emergence of this informal order, as it regulates competing contenders by playing one actor against the other. This is done by punitive military operations and through varying levels of state support for the lucrative informal service delivery that is provided by criminal, crime-terror networks and other non-state actors to citizens.
The state no longer has a monopoly on violence but instead acts as a referee of sorts, presiding over competing contenders for Karachi’s political and economic resources. In this order, violence is employed by political players as well as the state as a display of hegemony. Violence also increases along with the number of political contenders. The order in Karachi presents a fragile equilibrium that is mediated by the state from the top down, but which is changing from the ground up as well, impacting governance as players adapt and formulate responses to further extend their influence and gain support among local constituencies.
Organized crime has grown in Karachi over the past 35 years and now assumes a major economic and political role in the city. Its growth can be traced to the Russian invasion of Afghanistan in 1979 when Afghan farmers began to grow opium on a large scale. For Karachi, this development resulted in the transit of opium intended for markets in Europe and elsewhere through its ports. Over time, opium refineries also sprang up in northwestern Pakistan; there were an estimated 100 to 200 heroin refineries in the Khyber District alone. The drugs produced in this manner are also often transited through Karachi. An active weapons trade traversed the same route, a business often facilitated by various military and intelligence services.
The impact of the Afghan drug trade was multi-faceted. As Karachi became a transit point in the international drug trade, local crime groups became connected to the international drug trade, making the city an important node in the world of transnational organized crime. One immediate effect on the city was the transformation of its crime groups in Lyari, one of the oldest neighborhoods of Karachi with a predominantly Baluch population. Drug consignments transited through Lyari on their way to European, Gulf, and Central Asian markets. The Baluch gangs of Lyari became key intermediaries between the drug traffickers of the tribal areas and international buyers of Afghan drugs. Another neighborhood of Karachi, Sohrab Goth, predominantly inhabited by Pashtuns, became notorious for the presence of drug smugglers. A neighborhood on the outskirts of the city, Sohrab Goth was primarily associated with manual laborers from North West Frontier Provinces (NWFP) and Afghan refugees and became the largest Afghan refugee camp developed illegally on public land. It was known for its weapons stockpiles and its role in local heroin distribution as well as drug transport to international destinations.
The trade brought in substantial profits, converting petty criminals into feared drug traffickers. Drug profits were laundered via Karachi’s real estate market. As a result of the influx of Pashtuns into Karachi, the dynamics of the informal housing market changed. Until the early 1980s, most middlemen were either Punjabi or Mohajir. Mohajirs were individuals who had migrated from India to Pakistan in the wake of the partition of British India in 1947. Pashtun middlemen, however, soon replaced Punjabis and Mohajirs in the informal housing market and imposed new codes in squatter settlements: after seizing lands, plots were developed and tenants could be evicted at will. The result was coercion and ruthless violence on an unprecedented scale in Karachi in the 1980s. The outcome of this transition was that armed players flush with money gained in the drug trade had replaced existing players in the informal housing market. Over the years, the political and economic stakes became higher in terms of which players gained in power within the informal housing market and Karachi’s real estate sphere.
Similarly, criminal groups have played an important role in the informal water delivery racket. Informal water delivery, although not a centralized cartel, has been a permanent reality of the urban landscape since it began in the 1990s when there was an absence of rain and the state devised a solution to its water delivery problem. To address citizens’ needs, supply points were created by the state where thousands of tanker trucks were filled up daily to distribute water to the parts of the city affected. The solution comprised of selling water at a nominal price through commercial water tankers to parts of the city which were experiencing water shortages. Because the institution responsible for water and sanitation (Karachi Water and Sewerage Board – KWSB) lacked capacity, the provincial government entrusted the task to paramilitary forces stationed in the city.
Locally known as Rangers, the paramilitary forces had been deployed in Karachi since 1989, and were considered more efficient and neutral than the local police. Rangers, who managed official hydrants for KWSB and ensured the supply of drinking water to the residents, however, also sold water in the informal market, charging double the official rate, according to unofficial sources in Pakistan. In addition, they extended support to organized crime groups engaged in the parallel water supply, earning significant incomes, although these are difficult to quantify. Gayer argues that these illegal activities on the part of the Rangers were tolerated by the state because they had been asked by the local government to engage in law-enforcement duties that fell outside their mandate.
There are now more unofficial water filling points than official ones. At these unofficial sources spread across the city, water is siphoned off, often to be delivered by non-state actors, particularly criminal groups.Although not a centralized cartel, these actors are organized and have formed an association to advocate on their behalf. According to estimates, this enterprise provided the criminal providers with approximately 49.6 billion Pakistani rupees (approximately 474 million dollars) annually in the early 2000s.
Although informal water supply and housing is commonly attributed to “water mafias” and “land mafias” with connotations of criminality, it fails to take into account the pivotal role played by the state in these activities. Because access to drinking water and housing is central to daily existence, the ministries for land and water are highly contested among political parties as housing and water provision as issues are not only urban topics but also highly political in nature. They are also lucrative – wherever water development projects by international development agencies are introduced, the value of land goes up. Access to such information before it becomes public is available to those who are part of government. As a result, those who are privy to this “insider information” can engage in land grabbing in those parts of the city intended for development, earning significant economic and political gains for themselves and the political institutions with which they are affiliated. Often the beneficiaries of land grabbing and the unofficial sub-division of land go beyond ministry officials and include elected members of government, law enforcement officials, political parties, and land owners.
Crime groups play an integral role in the political economy of the city, along with their role in land and water issues as mentioned above. In the violent politics of Karachi, their implicit and explicit support to political players gives the party structural “enforcers” who may carry out violence against opponents. This recalls the role of the yakuza in pre-world War II Japan who were used by forces loyal to the emperor to silence opponents. As in the case of Japan in the 1930s, this support provided to the existing power structure reflects the fact that leaders of crime groups believe in the idea of the state and thus are interested in remaining within the political system. This is in contrast to terrorist groups like the TTP, founded in 2008, that seeks to establish a Sharia state in Pakistan. In line with its stated objective, it has a more destructive approach to the existing political order.
This approach to the state differentiates criminals from terrorists. Because criminal groups provide services that have been ceded by the state, they are dependent on the state’s implicit support of their activities. This separates them from the terrorist groups prominent in the city, but not from crime-terror groups such as D-company that need state support to continue their criminal activities.
In Karachi’s politics, violence has become an enforcement mechanism among political players and is perpetrated by political party affiliates as well as crime groups. A striking example of this phenomenon is the People’s Aman Committee (PAC), founded in 2008 and comprised of the Baluch drug dons of Lyari. The PAC served as an enforcer for the Pakistan People’s Party (PPP) during the latter’s stint in government (2008-2013). Initially, it had a clientelist relationship with the PPP as the PAC received implicit political support from the ruling party in exchange for access to votes in the neighborhood of Lyari, a pattern reminiscent of Sicily discussed earlier. It also provided personnel who could challenge the de-facto hegemony of the political party, MQM, by practicing extortion in Karachi.
Over time, however, the PAC presented itself as a political player and not just as a band of drug dons doing the bidding of one of the largest political parties in the country. It demanded that its nominated candidates run for seats in the legislature instead of PPP’s politicians who were not cognizant of the problems faced by the people of Lyari. Under the PAC’s control, crime rates plummeted while money acquired through the drug trade and extortion was invested in public welfare schemes in Lyari. The PAC’s increasingly political role threatened to change the clientelist dynamic of the relationship between the PPP and the PAC. As a result, rifts grew between the PAC leadership and the PPP, resulting in the political party distancing itself from the drug dons it had formerly supported.
By September 2013, a military operation to cleanse the city of criminal and terrorist elements was underway in Karachi. The objective of this operation was to target actors in the city responsible for violence, extortion, and other criminal activities. The PPP had withdrawn its support of the PAC and the leaders of the PAC were on the run, highlighting the vulnerability of crime groups dependent on state support. Yet, despite its exit from the stage, the rise of the PAC highlights the changing dynamic between a political party and a crime group. It shifted from a clientelistic role to a political one. In making this transition, it represents a new actor on Karachi’s political stage.
Over seventy years, Karachi has become one of the world’s largest cities. Successive governments have ceded authority to non-state actors for the provision of housing and water. This devolution of power can be explained by limited resources, poor policy planning, and a rapidly increasing population resulting from rural to urban migration and displacement caused by conflict. Some have suggested that this hands-off approach to governance is a post-colonial legacy of indirect rule  and (or) a continuity of the criminal-cum-political strongmen of British India who worked as intermediaries between the rulers and the ruled. As in many regions of the world, historical legacies shape both political developments and the nature of crime.
Yet there was an ever-present reality determining its development. Karachi’s constantly increasing population created demands for public amenities in a newly-independent state struggling to remain unified despite great financial challenges and the pressures of a diverse multi-ethnic population. Karachi, with its strategic location as a seaport, also suffered from the curse of geography as it developed as a trafficking route for drugs and weapons during the Afghan jihad days and continued in this role well after September 11. It was in this context that non-state actors stepped in to contribute to service provision incrementally.
Efforts made to reassert state authority have had limited success despite successive military operations in Karachi since the 1990s, and one operation that has been on-going since 2013. While the operations in the 1990s primarily targeted the political party the Muttahida Qaumi Movement (MQM), the operation launched in 2013 focused on crime groups in Lyari, and the terrorist group, Tehreek-e-Taliban Pakistan (TTP), as well as the MQM. For the TTP, the ongoing simultaneous military operations in 2013 both in its stronghold in the tribal areas of Pakistan adjacent to Afghanistan, and against its forces in Karachi weakened its organizational and operational strength. These operations also resulted in losses being incurred by Karachi-based crime groups.
The result of these operations in different parts of Pakistan was the recruitment of criminals into terrorist groups to carry out revenge attacks jointly, in the process confusing law enforcement officials in terms of the source and planning behind these violent and destructive activities. The state’s lack of success in scaling back non-state actors reveals that, in the past two decades, Karachi’s political landscape has grown to include new types of political players on a permanent basis.
The state manages this violent political order by withdrawing or extending support from or to different political players: the MQM, a criminalized political party drawing from diverse migrant constituencies, various organized crime groups that have profited from the lucrative drug trade and the crime-terror and crime groups that have established themselves in the city, as previously mentioned. Within this competition for power, the state remains the final arbiter. This conclusion contradicts the policy analysis of some observers who suggest that crime and terror groups have stepped into a power void. Rather, this analysis suggests that it is the political parties themselves, rather than the criminals and terrorists, who are at the forefront of violent and criminalized politics. Therefore, violent non-state actors are not the ultimate arbiters of the political order. Criminals and terrorists remain vulnerable as they may lose the state’s support and without this they face difficulty surviving in this highly competitive environment.
Louise Shelley thanks the Carnegie Corporation that supported her as an Andrew Carnegie Fellow that allowed her to write this paper.
Nazia Hussain is a Japan Society for the Promotion of Science (JSPS)-UNU Postdoctoral Research Fellow with the UNU Center for Policy Research. She holds a PhD in Public Policy from the Schar School of Policy and Government, George Mason University. She held a Fulbright scholarship for the duration of her Master’s in International Relations from Boston University. She has written book chapters on the topics of informal governance, urban conflict, and crime-terror linkages for studies commissioned by a UNODC-sponsored project (2016) and the Wiley Handbook of Criminology (2016). E-mail: firstname.lastname@example.org.
Dr. Louise Shelley is the Omer L. and Nancy Hirst Endowed Chair and a University Professor at George Mason University. She is affiliated to the Schar School of Policy and Government and directs the Terrorism, Transnational Crime and Corruption Center (TraCCC) that she founded. She is presently an inaugural Andrew Carnegie Fellow writing a book on illicit trade and sustainability under contract with Princeton University Press. She has published extensively on transnational crime, human trafficking and the relationship between crime and terrorism, including the monographs Human Trafficking: A Global Perspective (CUP, 2010) and Dirty Entanglements: Corruption, Crime and Terrorism (CUP, 2014). E-mail: email@example.com.