A new report released by Canadian Department of Finance states that several terror organisations, including the Khalistani extremist groups, have been funded by financial sources originating from Canada for activities linked to politically motivated violence in the country.
The 2025 Assessment of Money Laundering and Terrorist Financing Risks places certain Khalistani groups, including Babbar Khalsa International and the International Sikh Youth Federation, under the category of Politically Motivated Violent Extremism (PMVE) and alleges them of exploiting funding networks, including those in the non-profit and charitable sectors, to support their objectives.
The report describes PMVE as "the use of violence to establish new political systems or new structures and norms within existing systems." These groups are designated terror entities under the Canadian Criminal Code, which is also includes Hamas and Hezbollah.
The report further clarifies that such extremism may include religious elements, but is primarily driven by political self-determination or representation rather than by racial or ethnic supremacy.
"Several terrorist entities listed under the Criminal Code in Canada that fall under the PMVE category, such as Hamas, Hezbollah, and the Khalistani violent extremist groups Babbar Khalsa International and the International Sikh Youth Federation, have been observed by law enforcement and intelligence agencies to receive financial support originating from Canada," the report read.
The 2025 assessment elaborates on the financing methods employed by PMVE groups.
Khalistani extremist elements, particularly those advocating violent means, are also suspected of raising funds through similar channels.
"These groups previously had an extensive fundraising network in Canada but now appear to consist of smaller pockets of individuals with allegiance to the cause but seemingly no particular affiliation to a specific group," the report notes.
One of the concerns highlighted by the report was the abuse of non-profit and charitable activities, a method widely documented in the case of Hamas and Hezbollah.
Khalistani networks have similarly solicited donations from diaspora communities, including through NPOs, to raise and transfer funds, the report observed.
"The misuse of the charitable and NPO sectors has been observed as a prominent financing method used by Hamas and Hezbollah. Khalistani violent extremist groups have also been known to use networks to solicit donations from diaspora communities to raise and move funds, including through NPOs. Despite these observations, it is estimated that revenue generation through NPO abuse represents a relatively small percentage of operational budgets of terrorist groups overall," the report read.
Earlier, Canada's premier intelligence agency, the Canadian Security Intelligence Service (CSIS), acknowledged that Khalistani extremists are using Canadian soil to promote, fundraise, and plan violence in India.
In its annual report released in June, CSIS outlined some key concerns and threats to Canada's national security.
The Canadian intelligence agency CSIS report categorically states, "Khalistani extremists continue to use Canada as a base for the promotion, fundraising or planning of violence primarily in India."
The 2025 Assessment of Money Laundering and Terrorist Financing Risks places certain Khalistani groups, including Babbar Khalsa International and the International Sikh Youth Federation, under the category of Politically Motivated Violent Extremism (PMVE) and alleges them of exploiting funding networks, including those in the non-profit and charitable sectors, to support their objectives.
The report describes PMVE as "the use of violence to establish new political systems or new structures and norms within existing systems." These groups are designated terror entities under the Canadian Criminal Code, which is also includes Hamas and Hezbollah.
The report further clarifies that such extremism may include religious elements, but is primarily driven by political self-determination or representation rather than by racial or ethnic supremacy.
"Several terrorist entities listed under the Criminal Code in Canada that fall under the PMVE category, such as Hamas, Hezbollah, and the Khalistani violent extremist groups Babbar Khalsa International and the International Sikh Youth Federation, have been observed by law enforcement and intelligence agencies to receive financial support originating from Canada," the report read.
The 2025 assessment elaborates on the financing methods employed by PMVE groups.
Khalistani extremist elements, particularly those advocating violent means, are also suspected of raising funds through similar channels.
"These groups previously had an extensive fundraising network in Canada but now appear to consist of smaller pockets of individuals with allegiance to the cause but seemingly no particular affiliation to a specific group," the report notes.
One of the concerns highlighted by the report was the abuse of non-profit and charitable activities, a method widely documented in the case of Hamas and Hezbollah.
Khalistani networks have similarly solicited donations from diaspora communities, including through NPOs, to raise and transfer funds, the report observed.
"The misuse of the charitable and NPO sectors has been observed as a prominent financing method used by Hamas and Hezbollah. Khalistani violent extremist groups have also been known to use networks to solicit donations from diaspora communities to raise and move funds, including through NPOs. Despite these observations, it is estimated that revenue generation through NPO abuse represents a relatively small percentage of operational budgets of terrorist groups overall," the report read.
Earlier, Canada's premier intelligence agency, the Canadian Security Intelligence Service (CSIS), acknowledged that Khalistani extremists are using Canadian soil to promote, fundraise, and plan violence in India.
In its annual report released in June, CSIS outlined some key concerns and threats to Canada's national security.
The Canadian intelligence agency CSIS report categorically states, "Khalistani extremists continue to use Canada as a base for the promotion, fundraising or planning of violence primarily in India."
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