Ottawa: A recent government report titled the "2025 Assessment of Money Laundering and Terrorist Financing Risks in Canada," released by the Canadian Department of Finance, reveals that several terrorist entities, including Khalistani violent extremist groups such as Babbar Khalsa International and the International Sikh Youth Federation, continue to receive financial support originating from Canada for politically motivated violent activities. These groups fall under the category of Politically Motivated Violent Extremism (PMVE), defined as the use of violence to create new political systems or norms within existing ones.

The report highlights that these Khalistani groups exploit various funding networks, including the non-profit and charitable sectors, diaspora communities, and illicit activities such as drug trafficking and vehicle theft, to raise and transfer funds for their aims of establishing an independent state in Punjab, India. Similar financing methods are also observed among internationally designated terrorist groups like Hamas and Hezbollah, who use money service businesses, banking sectors, cryptocurrencies, state sponsorship, and misuse of charities to support their operations.

Moreover, the Canadian Security Intelligence Service (CSIS) confirms that Khalistani extremists use Canadian soil as a base to promote, fundraise, and plan violence primarily targeting India, a concern that has long been raised by India and is now officially recognised by Canada's intelligence agencies. The report noted that while these funding networks were once extensive, they now appear to comprise smaller groups maintaining allegiance but lacking formal ties to a specific organisation.

A major concern is the misuse of the non-profit and charitable sectors, which represent a relatively small but prominent financing channel for these terrorist groups. Despite Canada’s overall strong anti-money laundering and anti-terrorist financing regime, the report calls for continued vigilance and targeted measures to combat external influence campaigns and domestic extremist financing networks that threaten national and international security.

This acknowledgement by Canada has reignited attention on the delicate diplomatic relationship between Canada and India, with calls for persistent efforts to curb terrorist financing and extremist activities within Canadian borders.

With inputs from ANI