New Delhi: Last week, a pro-democracy ethnic armed organisation (EAO) of Myanmar pulled off a notable victory – pushing out the Junta forces from the entire Kokang region in the Shan State bordering China’s Yunnan Province.
The particularly prized catch for the EAO was taking control of Laukkaing, the principal township of Kokang.
Since October 27, under the banner of Operation 1027, Myanmar’s Brotherhood Alliance – a rainbow configuration of three major EAOs and pro-democracy People’s Defence Force (PDFs) – has been putting up a rather robust fight against the military. They have been particularly successful in snatching away strategic areas of Myanmar along its border with China and India.
This particular EAO in the Shan State, has, inch by inch, been grabbing key trading towns of Myanmar with China. Myanmar’s longest border with China is along the Shan State.
All those little conquests by the EAO were unabashedly aimed at pushing out the Junta from Laukkaing, the town that rolls in the biggest pile of hard currency in the entire region.
Significantly, responding to the Junta’s surrender to the EAO forces in Kokang, Junta spokesman Zaw Min Tun had told the local media outlet, Popular News Journal, that such a step was taken just to maintain relations with China. “The regime is under pressure from China to restore stability along the border,” said The Irrawaddy.
That a number of Chinese citizens in Yunnan were injured by the artillery fired by the Junta at the EAO forces during the Kokang offensive, and that at its heels, top Chinese diplomats had a closed door meeting with the Junta chief, Min Aung Hlaing, at Naypyidaw, were seen as triggers behind the military ejecting from Kokang.
However, in the fall of Kokang, particularly Laukkaing, there is more to it than just China’s anger at the Junta guns injuring its nationals in Yunnan.
The most compelling reason behind the Chinese establishment’s readiness to back the EAO in the Shan State rather than the Junta to take control of Kokang is that Laukkaing had become a seedy town, which the Asian giant would rather not have on its southern border.
Over the years, Laukkaing has proved to be a curse for a large number of people from China as well as for many from other South and East Asian nations
More significantly, the China-backed fall of Laukkaing may also end up bringing home hundreds of Indians trapped in that township.
Which EAO has taken control of Laukkaing?
Before getting down to the Chinese interest in a change of guard at Laukkaing, lets first focus on the EAO that took control of it from the Junta forces on January 4.
Laukkaing was surrendered to the Myanmar National Democratic Alliance Army (MNDAA), a Kokang-based militia, which had joined the pro-democracy Brotherhood Alliance. The other two EAOs are the Arakan Army based in the Rakhine State, and the Ta’ang National Liberation Army, based in the northern part of the Shan State.
MNDAA was an outfit once commanded by Peng Jiasheng, a name both dreaded and revered in the Kokang region. This recent attempt of MNDAA to take over Laukkaing was its second since 2015.
Who was Peng Jiasheng?
Often termed the ‘king’ of Kokang, Peng was of Chinese descent. He passed away in February 2022, aged 91. He was particularly noticed in the 1980s as a leader of the China-backed Burmese Communist Party before deciding to break out of it to build his own militia, the MNDAA.
He is remembered across Kokang as its virtual ruler once, the prime peddler of opium. According to noted Asia watcher Bertil Lintner, Peng had set up the first opium factory at Kokang in the 1970s and controlled trafficking of the drug in that route. An extremely poor region, residents of Kokang make a living by growing poppy; Kokang is one of the world’s largest producers of opium.
Peng’s death in 2022 dealt a significant blow to the MNDAA. His loyalists organised a lavish funeral in Mong La, a small town in Kokang where he had passed away. All top militia leaders, along with representatives from the Chinese and Myanmar governments, attended the funeral.
The Diplomat had written: “Among the rota of high-profile visitors at the funeral were Tun Myat Naing, the head of the Arakan Army, as well as leaders from the Shan State Army, the Karenni Nationalities Defence Force, the Ta-ang National Liberation Army, and Kachin Independence Army. There were also Chinese government representatives and the top commander of the Myanmar military’s Kengtung-based Golden Triangle Command, despite the military currently being engaged in hostilities with the MNDAA further north.”
It further said, “Little known outside Myanmar and China, Peng (Pheung Kya-Shin in Burmese) has for decades been an integral player in the fluid conflict economies of Myanmar’s Shan State.”
What added to Laukkaing’s fame?
Peng is particularly remembered in Kokang for making Laukkaing a name to reckon with. He went on to transform Laukkaing from a nondescript, poor, dusty settlement along China’s Yunnan Province into a major gambling hub. His aim was to offer the rich Chinese a casino town in the neighbourhood since gambling was/is a banned activity in that country.
Hordes came down to Laukkaing from across the border. In the course of time, the glitzy casinos and hotels set up in Laukkaing with Peng and his warlord allies’ drug money succeeded in enticing gamblers from other Asian countries. Peng’s militia, meanwhile, also succeeded in spreading its tentacles to other lucrative businesses across East Asian nations like Laos, Cambodia, etc., including illegal mining.
With time, Laukkaing transformed into a bustling town with high rises, emerging as a major gambling destination in that part of Asia, generating billions every day.
However, around 2009, Peng fell into trouble. He had to temporarily flee to China after falling out with Myanmar’s Junta for refusing to support it against the pro-democracy forces, including Aung San Suu Kyi’s party. Junta chief Min Aung Hlaing ordered raids at Peng’s house in a drug trafficking case, and convinced his deputy Bia Suocheng to turn against him.
With Junta’s support, Bia succeeded in snatching away Peng’s multi-crore casino business. Still, a considerable number of MNDAA leaders continued their support to an ageing Peng.
Under Bia, who was joined in by some other warlords of Chinese origin, Laukkaing also became notorious for money laundering and human trafficking, not just from China but from across several Asian nations, including India.
Also read: Recent Developments in Chin State Raise More Questions on New Delhi’s Approach Towards Myanmar
Why did China back MNDAA in seizing Laukkaing?
Over time, the warlords in control of Laukkaing’s gambling business extended their operations to include Internet fraud. It lured hundreds of IT professionals to Laukkaing promising better employment. On arrival though, they would be illegally detained, with their passports confiscated. They would be forced to work at the casinos and carry out Internet frauds across the world. Those who resisted were beaten up, tortured with electric shocks, and even shot dead if seen fleeing.
China, unable to put a stop to the menace at its border and its nationals regularly falling into the trap, had, from time to time, put considerable diplomatic pressure on Myanmar’s Junta to clamp down on the criminal elements.
Though at times, the Junta had handed over to the Chinese Police scamsters wanted in that country, its deep links with the warlords at Laukkaing, who run those online scam centres, had come in the way of doing anything drastic.
Since those warlords were Junta allies, they hoped to be protected by it and didn’t quite restrain themselves from defrauding the Chinese nationals, including trafficking them to Kokang.
Now, by backing the MNDAA’s takeover of Laukkaing, China’s dominion over the gambling hub, and the lawless region in general, is a given.
Already, several top family members of Laukkaing’s top scamsters and casino owners have been handed over to the Chinese authorities by the local administration to face trial. According to some reports, Peng’s deputy Bai had scooted Laukkaing for an unknown place. One such warlord of Chinese descent is said to have committed suicide.
Laukkaing’s tentacles across Asia
The Laukkaing scamsters had also been conning people from other Asian nations. In August 2023, the United Nations Human Rights Office, in a report, had said, “Hundreds of thousands of people are being forcibly engaged by organised criminal gangs into online criminality in Southeast Asia – from romance-investment scams and crypto fraud to illegal gambling.”
“People who are coerced into working in these scamming operations endure inhumane treatment while being forced to carry out crimes. They are victims. They are not criminals,” UN High Commissioner for Human Rights Volker Türk said in that report.
The report, citing data, said, “Credible sources indicate that at least 120,000 people across Myanmar may be held in situations where they are forced to carry out online scams…”
The same data was quoted by the UK in December while sanctioning 14 individuals and entities connected to the Southeast Asia’s ever expanding online scamming industry, including Myanmar. More on it can be read here.
In November, with the MNDAA forces closing in, dozens of Thai nationals trapped in Laukkaing pleaded online to be saved from their masters’ clutches. The victims’ families had then approached the Chinese embassy in Bangkok to come to their rescue.
Around the same time, 166 Vietnamese nationals were rescued from such casinos in Myanmar.
In December, news reports said that the Sri Lankan government was also trying to free dozens of their nationals being held in the Shan State and “forced to work as cyber slaves forced to commit internet scams”.
Indians trafficked
Hundreds of Indians have been lured into Myanmar, too, to carry out similar online crimes under detention. Between February and March, 2023, the Indian government rescued 21 Indian nationals, who were duped by online job scams, from Myanmar.
In October 2022, as many as 130 such victims were also brought back home.
Some of these returnees had shared stories of a harrowing time in detention and had also reported that many more Indians were still trapped in those seedy places.
In July 2023, the Union minister of external affairs, V. Muraleedharan, had told the Rajya Sabha that at least 414 Indians were being held illegally by the internet scamming firms in Myanmar. All of them had been lured by fake IT jobs in that country. The minister had said that of that total number, 292 had been rescued and brought back to India.
The minister had also told parliament that 150 Indians were rescued from similar scam centres operating from Cambodia.
Last week, Rajesh Kumar, chief executive officer of the Indian Cyber Crime Coordination Centre within the Ministry of Home Affairs, had told reporters in Delhi that around 50% of the cybercrime complaints the Union government’s helpline receives everyday originates in China, and pockets of Cambodia, and Myanmar.
With Laukkaing’s fall, there is hope not only for the remaining Indian nationals trapped there to find their way to safety but also for a change in the number of Internet frauds committed worldwide.
