WHEN RAJ Singh smiles, you will want to pay him, even if you don’t owe him money. The polite 28-year-old Indian knows his way with Filipinos, especially with those he has to deal with in his money-lending business, an informal financing scheme called “5-6” that Indians in the Philippines are known for.
INDIAN money-lenders like Raj Singh are increasingly
Left with relatives in India, where he was born, Singh’s parents asked him to join them in the Philippines when he was 15 years old. They wanted his help in their 5-6 business, in which every P5 borrowed means a payback of P6 over a period of one week. He has since been touring the streets of Caloocan City to lend money and collect daily dues from clients, from eight in the morning to five in the afternoon.
Singh says business has been good, echoing many other Indians in his line of work. Yet he is now thinking of leaving the Philippines after a spate of attacks against Indians in the last two years, attacks that have led to deaths in several cases and have prompted the Indian government to express concern and ask Philippine authorities for help.
News of the attacks have also reached Indian communities in other countries, where these have not only led to statements of concern, but also raised tensions between Indian and Filipino expatriates. In Vancouver, Canada, one Filipino was so alarmed at the terse exchanges between the two groups in a cyberforum that she asked which areas she should avoid “if I don’t want to be killed by Indians?”
For sure, such reactions can be traced largely to inaccurate reports, such as one by an Indian newspaper that said as much as 100 Indians were killed in the Philippines in the past five years. Yet while India’s Ministry of External Affairs says that 19 Indians have been killed in this country in the last two years, that figure is a sharp increase from previous years. Official statistics from India also indicate that in 2006 alone, about a dozen Indians were killed in the Philippines — the highest number of Indian fatalities that year outside of their home country, higher even than those posted in places like Afghanistan, Iraq, and India’s perennial rival, Pakistan.
N.S. Kalsi, Commissioner of Non-Resident Indians Affairs in Punjab, where many Indians in the Philippines hail from, has even written to the deputy commissioners of all the districts in the northern Indian province, advising them to dissuade people from migrating to this country. “The attacks on our community in the Philippines is a matter of concern for us and our advice to all Indians is to don’t migrate to the Philippines, at least (until) the situation improves there,” he said in a recent phone interview.
Attacks on the rise
The Philippine National Police (PNP) admits its records are inaccurate and thus do not match those of the Indian authorities. Still, police records and news reports strongly indicate that the attacks against Indians are indeed on the rise, and range from holdups to kidnapping to outright ambushes, and occur even outside of Metro Manila. Police records alone show that in 2005, there were only three crimes against Indians, but the figure shot up to 13 in 2006. From January to June 2007, the PNP had already recorded eight cases with Indians as victims.
Local authorities agree with some Indian nationals that the killings especially may have been masterminded by fellow Indians against business rivals. The Indian government itself says that some Indians have joined the ranks of Chinese and Filipinos involved in kidnapping and extortion, which may help explain the sudden spike in the cases of ambushes and abductions of Indians. But no one doubts that Filipinos have been the perpetrators in several of the attacks.
BHAGWANT Rai Bansal convenes the board of Khalsa Diwan Inc., the oldest and largest Indian organization in the Philippines. [photo by Avgail Olarte]
“Many families are being destroyed,” says Bhagwant Rai Bansal, president of Khalsa Diwan Inc., the oldest and largest Indian organization in the Philippines. Khalsa Diwan’s members have been victims both of holdups and ambushes.
Those into 5-6 are the usual victims, and the Indians interviewed for this story themselves say they are easy targets. One can spot them on any crowded street or market, riding motorcycles and with backpacks, sometimes carrying umbrellas, towels, and home appliances that they sell. Worse, their daily schedule is predictable.
Just two weeks ago, a 50-year-old Indian moneylender was attacked in Raj Singh’s neighborhood. Two Filipinos approached the Indian in broad daylight, drew a gun, and announced a holdup. One of the men then tried to grab his cell phone while the other concentrated on his backpack while kicking him. The moneylender was able to run even as one of the men fired the gun at him. The gunman missed and fled, but his accomplice was pounced upon by local residents, who splashed hot water on his back.
In an earlier incident, also in Caloocan, 40-year-old Khulwinder Singh narrowly escaped death when he was shot by two unidentified Filipinos who tried to grab his bag. He was in intensive care for over a week.
Police records show similar incidents have been occurring in Zambales, Bulacan, and Nueva Ecija. There have also been kidnappings of Indians, with ransoms ranging from P60,000 to P200,000; in one case in Isabela, the ransom even reached P2 million. According to the police, the number of kidnapping cases in the first four months of 2006 rose by 70 percent compared with the same period in 2005. Most of the abductions, it said, were of Indians involved in moneylending.
Then there are the assassinations, which police suspect are being done mostly by a particular group of Indians against business competitors. Some members of the Indian community here say about seven separate ambushes attributed to the group resulted in six dead victims. The seventh target, who survived, is now receiving death threats.
The Indian embassy in the Philippines says that it “has taken up the matter of safety and security of Indian nationals with the Philippine authorities on several occasions,” and that “in a few cases, the perpetrators of the criminal acts were apprehended by the police and were dealt with according to the Philippine law.”
In India, the spokesman of the Ministry of Overseas Indian Affairs (MOIA), Ajit Kumar, says that the ministry has taken up the matter of attacks on Indians with the Philippine government. “We have been assured by the Philippine government about the safety of Indians and that the culprits will be punished,” he says.
INDIANS feel they get little protection from authorities despite the increase of attacks against Punjabis in the last two years. [photo by Avigail Olarte]
But Indians in this country sound less convinced, largely because they know many of the crimes against members of their community usually go unresolved. Of the 24 crimes (robbery, holdup, kidnapping, stabbing, murder, etc.) against Indians that appear in PNP records from 2005 to June 2007, 15 remain unsolved, with the suspects still at large.
When asked why majority of the cases are still unsolved, the police replied they usually operate based on priorities. But one high-ranking police official exclaimed when he saw the list involving Indian victims: “P__ ina, napabayaan ito, ah (Son of a bitch, this was not attended to)!” He has since issued a directive for the cases to be followed up.
In fact, the official was even looking at an incomplete list, since several Indian victims are apparently illegal aliens and thus refrain from filing complaints. Yet even those with proper documents say they would not bother to go the police since, they say, they will not be given much attention anyway.
“If you complain, the police tells you, ‘Siguro marami kang pera, buhay ka naman, alis ka na (Maybe you have a lot of money. But you’re alive, so get out of here),” says one Indian resident in Manila. “So we keep quiet. We are on our own.”
The Indian community in the Philippines, however, is quite formidable in terms of numbers. The Indian Embassy estimates that there are about 28,000 Indians in the country, although the Bureau of Immigration (BI) reports that there are 20,215 registered Indians. Most of the Indians here are either Punjabis, the rural folk, or Sindhis, historically known as the urban merchants and traders.
Writer Anita Raina Thapan says both Sindhis and Punjabis arrived in the Philippines at the end of the 19th century. The Punjabi migrants, who were mostly farmers, initially wound up as vendors or security guards, writes Thapan in the book The Philippines as Home: Settlers and Sojourners in the Country. It was only later that they went into 5-6, which was apparently something they had not tried out in Punjab. Whoever thought of the scheme and why is not known, but it has been lucrative enough to lure more and more Indians to the country. Most of Raj Singh’s relatives, for example, have already migrated to the Philippines to engage in microfinancing.
Official data, meanwhile, show that many Indian migrants were enticed to register in the mid-1990s (from 503 in 1994 to 3,141 in 1995), partly because of the implementation of the Alien Social Integration Act, which allowed those considered as “illegal aliens” to be granted legal residence status. There was another surge in registration in 2001 up until 2003, with majority of the applicants granted temporary resident visas. But last year, only 110 Indian nationals bothered to register with the immigration bureau. Some observers say that may have been because of the attacks, but the BI says the decline in registration may be partly because most already shifted to the I-card, an electronic card that replaced the paper-based Alien Certificate of Registration. Interestingly, the number of Indian arrivals increased from 26,894 in 2005 to 28,824 in 2006, or a rise of seven percent.
Whether Indians are targeted because of their race — at least in cases where the perpetrators are local — isn’t clear, although some Indians believe that is the reason why the police do not give them the attention they deserve. A British Broadcasting Corp. poll conducted in October 2005 to January 2006 has revealed that 57 percent of the Filipinos asked had a “mainly negative” view of India’s influence in the world, making Philippines the only country (among 33 nations) where “such an unfavorable view was most prevalent.” Unfortunately, it does not define what a “negative” view entails.
MARKET vendors along 3rd Avenue in Caloocan say they prefer Indian 5-6 moneylenders over Filipino lenders. [photo by Avigail Olarte]
A news site in India, in the meantime, states that Filipinos resent Indian moneylenders. Yet it attributes this to the local media’s “adverse publicity,” even though stories on Indians and their affairs are rarely seen on Philippine TV and newspapers. The killings, in fact, are underreported.
What has landed in some papers are views of the likes of former House Deputy Minority Leader Rolex Suplico that obviously do not help relations between Indians and Filipinos. Last year, Suplico said he feared that the Philippines would one day become a “Bumbay Republic” and urged authorities to make an inventory of all Indians here and deport all the illegals and “undesirables.”
“(They’re) everywhere, running their 5-6 business and exploiting our people,” he told a group of reporters. “We have to stop the motorcycle-riding Bumbay Invasion.”
Interviewed recently by PCIJ, Suplico, now Iloilo vice governor, clarifies that he is against “illegal Indians” only. But he does balk at the idea of Indians controlling “even a small segment of the economy” like the lending business.
“But, of course,” he says, “they’re entitled to protection.” He then recalls how an Indian who had apparently been robbed once approached him, seeking help in apprehending the perpetrators. As Suplico tells it, the Indian said he didn’t care about the money, but wanted his list of clients’ debts back. Suplico says the Indian has since graduated from going around in a motorcycle to driving a pick-up truck.
High rates of 5-6
There are other Filipinos who see the 5-6 business as usurious, as the interest rates are too high. While the Central Bank suspended the Usury Law in 1983, lifting restrictions on the interest cap and allowing parties to agree on the interest rate, the Supreme Court has ruled that a 66-percent or 72-percent annual interest is excessive and exorbitant. The 5-6 business charges 10 percent per month (20 percent for two months) or 120 percent a year. Using the same rate for a period of 40 days — since Filipinos sometimes prefer a shorter period — the annual interest rate would be something like 182 percent.
AFTER the series of killings last year, the Indian government issued a directive discouraging its citizens to come to the Philippines. [photo by Avigail Olarte]
From the looks of it, though, it seems that the Indian moneylenders are being targeted simply because the criminals know they carry cash, as well as because of the likelihood that they will not bother going to the police. Being victims of holdups is also not exactly new to the lenders; Raj Singh says he lost P2,000 to a gun-toting holdupper a decade ago.
Some observers have theorized that there may also be an element of “retaliation” in the holdups because of the high interest rates of 5-6. Filipino small-time borrowers, however, do not seem to mind such rates, since there are few loan sources available to them. A police officer at the Caloocan Sub-station 2 says he has borrowed from four Indians, with amounts ranging from P25,000 to P35,000. He had to resort to 5-6, he says, because nearly all of his monthly salary goes to payment of other debts, having exhausted all lending and insurance institutions.
“Kapit-patalim ka kasi ( You get desperate),” he says. He adds, however, that Indians are known to be generous and considerate so long as one is a good payee. The officer says that when he had to rush his wife to the hospital in the middle of the night, the neighborhood Indian moneylender, whom he calls his friend, readily gave him the money he needed.
Indian moneylenders are also sometimes preferred by Filipinos over their local counterparts. Indian lenders, most of whom are men, are more discreet, say borrowers. They say that Filipino lenders are usually women who tend to gossip about their clients.
One vegetable and fish vendor in Caloocan says Indian moneylenders are understanding of clients who sometimes are unable to pay on time. She says she borrows from an Indian moneylender every two months to reinfuse her capital. For a P5,000-loan, the vendor pays P100 per day. On days when she earns only P300, she cannot pay her daily due. But she says her Indian lender merely takes note of it and doesn’t make a scene.
A tricycle driver who usually has a daily due of P20 to an Indian moneylender at any given time admits to being remiss with his payments occasionally. But he says the Indians “rarely complain. They just say, ‘Okay, tomorrow.’” Other tricycle drivers and market vendors also say the Indian moneylenders do not get “overly angry” or violent, although they say some do get fed up and huff, “You’re all just promises!”
But the Indians have grown much wiser, say some habitual borrowers. The lenders test the reliability of new clients by making them buy one of their wares, like an umbrella, an electric fan, or a 14-inch TV. These appliances usually have a 100-percent mark-up or higher. But the payment scheme is easy, requiring a daily due of only P20 until the entire amount is covered. If the new client can keep up payments for at least two weeks, the Indian lender then allows him or her to borrow money.
INDIANS are the third largest group of registered foreign nationals in the country, next to the United States and China. [photo by Avigail Olarte]
Other Indians nowadays also draft promissory notes signed by lawyers for both new and errant clients. Raj Singh, who heads the lending firm he put up with his Filipino and Indian friends in 2000, sometimes does this. Before, he says, it was all just based on trust. Many moneylenders, however, have had enough of borrowers who move out of their homes without settling their debts.
In Caloocan, Singh’s turf, small-time borrowers generally sympathize with the Indians, saying that they are always there to provide money when it is most needed. Asian Institute of Management associate professor Mari Kondo even says that it was the Indian lenders who helped keep Filipino vendors afloat during the 1997 financial crisis. The moneylenders tapped funds from India, where the rupee was only slightly affected, she says in a 2003 paper. “Indian 5-6s,” argues Kondo, “can be an asset for Filipino society, especially during economic downturns.”
Dhilip Budhrani, vice president of the Indian Chamber of Commerce, agrees that Punjabis in the moneylending business are helping in a way. He also says that Indians — whether Sindhi or Punjabi — have never been treated as outcasts in the Philippines. “Indians have been here for a long time,” he says. “They have integrated very well in the community.”
Bhagwant of Khalsa Diwan says that Indians normally enjoy a good relationship with Filipinos. He and his family have been here since the 1970s. But just like Raj Singh, he is now contemplating if it is still worth staying here in light of the increasing attacks against members of their community.
Yet an Indian who declines to be named asserts that many Indian migrants are staying put in the Philippines. “Indians in the Philippines have a better income than in India,” he says. “They’re taking a big risk by coming here, (but) they say never mind, if it has to be, it has to be. If we’re going to die, we’re going to die anyway.” — with additional reporting by Syed Nazakat in India