The hijacking of Indian Airlines flight IC 814 from Kathmandu to Kandahar on Christmas Eve, 1999, which culminated, a week later, in the humiliating release of three jailed terrorists — of whom two were Pakistanis — in exchange for the passengers and crew on board, was a searing experience for India’s intelligence, national security and diplomatic establishments.
From the early 1990s, Indian intelligence had been engaged in a protracted, covert war against Pakistan’s ISI, which had been exploiting the weaknesses in Nepal’s security architecture and the open Indo-Nepal border to mount offensive, plausibly deniable operations against India. This included the infiltration and exfiltration of terrorists trained in Pakistan, smuggling of high-grade explosives and weapons for attacks in India and the infusion into the Indian market of counterfeit Indian currency printed in Pakistan to augment the ISI’s war-chest and destabilise the Indian economy. From the mid-1990s, however, unpublicised but effective security cooperation between Nepal and India foiled many of the ISI’s designs. The plots disrupted are too numerous to recount. As the 20th century drew to a close, Indian intelligence appeared to be gaining the upper hand in the shadowy battle against their Pakistani adversaries in Nepal.
