Banking, Business, Education and Public Life

Professional and institutional relationships beyond politics

Agha Hasan Abedi’s international network was not confined to national leaders or people associated with philanthropy.

It also included bankers, economists, academics, diplomats, lawyers, business leaders and figures connected with universities, international organisations and public institutions.

Some of these relationships contributed directly to the establishment and development of the Bank of Credit and Commerce International (BCCI). Others supported Abedi’s proposals for financial cooperation among developing countries or his wider work in education, research and international affairs.

The nature of these associations varied considerably. Some were personal relationships; others existed principally between BCCI and another institution. Some involved professional advice or intellectual cooperation. Others arose through charitable trusts, scholarships, conferences or public events.

This section examines those different relationships while distinguishing carefully between a person’s association with Abedi and any involvement in the management of BCCI.

Alden W. Clausen and Bank of America

An important founding institutional relationship
Alden Winship “Tom” Clausen was president and chief executive of Bank of America when BCCI was established in 1972. He later served as President of the World Bank before returning to Bank of America.

His relevance to BCCI’s history arises principally from the relationship between Bank of America and the new institution founded by Abedi.

Abedi considered the participation of a major international bank essential to BCCI’s credibility. BCCI was entering international markets with a modest capital base and without the long history enjoyed by established Western banks. The support of Bank of America - then one of the world’s largest banks - gave the new institution both capital and standing.

Bank of America subscribed approximately 25 per cent of BCCI’s initial capital and later increased its interest. Its involvement helped reassure regulators, customers and other financial institutions that the new bank had the backing of an established international banking organisation.

The importance attached to that association can be seen in the Bingham Report’s account of BCCI’s early development. It observed that Abedi came to the Bank of England with Bank of America as a substantial shareholder, an institution regarded at the time as a model of sound and conservative banking.

Bank of America also provided BCCI with access to banking facilities and international experience during its formative period. It was nevertheless a minority and substantially passive shareholder. BCCI’s management remained under Abedi and the team he had assembled.

The Bank of America relationship ended when it began disposing of its shareholding during the late 1970s. Arrangements were subsequently made through which the shares became associated with structures established for the benefit of BCCI employees and their dependants.

Clausen’s inclusion should therefore be stated precisely. Bank of America was an important founding institutional shareholder and Clausen led that institution. He should not be described as a founder or manager of BCCI unless documentary evidence establishes a more direct personal role.

The association remains important because it shows that BCCI did not begin as an isolated or unrecognised banking venture. A leading American bank examined the proposal, invested in the new institution and lent it considerable international credibility.

Dr Dragoslav Avramović

Economist and adviser on the proposed Third World Bank
Dr Dragoslav Avramović was an economist with extensive international experience, including a long career at the World Bank.

After retiring from the World Bank, he became a consultant to BCCI and worked with Abedi on proposals for a new international financial institution commonly described as a Third World Bank or bank for developing countries.

The proposal reflected Abedi’s concern that the existing international financial system did not adequately serve the needs of developing economies. Many such countries faced shortages of foreign currency, unstable commodity earnings, balance-of-payments pressures and restricted access to long-term development finance.

The proposed institution was intended to encourage greater financial cooperation among developing countries. Its possible functions included:

financing trade between developing countries;
providing balance-of-payments assistance;
supporting development projects;
mobilising financial resources from within the Global South;
reducing dependence upon established Western financial centres; and
strengthening South-South economic cooperation.

Avramović’s involvement gave the proposal intellectual and professional substance. He brought experience of international development finance and an understanding of the economic problems facing poorer countries.

His association with Abedi was therefore different from that of a shareholder, customer or national leader. It was a professional and policy-based relationship centred on the design of a proposed international institution.

The Third World Bank was not ultimately established. Nevertheless, the work undertaken on the proposal demonstrates that Abedi’s wider ambitions were not confined to the commercial expansion of BCCI. He was also considering how financial institutions might be designed to address structural problems affecting developing economies.

Altaf Gauhar

Secretary-General and Chief Executive of the Third World Foundation
Writer, journalist and Secretary-General of the Third World Foundation
Altaf Gauhar was a prominent Pakistani civil servant, journalist, editor and writer who became the principal executive and intellectual figure behind the Third World Foundation.

He entered the Civil Service of Pakistan after independence and after leaving government service, he became editor of Pakistan’s leading English-language newspaper, Dawn. He was later imprisoned for his political views and, after his release, moved to London, where he concentrated increasingly on journalism, publishing and international affairs.

The Third World Foundation was established in London in 1979 on the initiative of Agha Hasan Abedi and with financial support from BCCI. Abedi served as Chairman of its Board of Trustees and provided its underlying vision and international backing.

Gauhar served as the Foundation’s Secretary-General and Chief Executive. He played a central role in turning Abedi’s vision for the Third World into an active programme of publications, conferences and international discussion concerning development and relations between the industrialised North and the developing South.

He served as Editor-in-Chief of South magazine and Editor of Third World Quarterly, both published with the support of the Third World Foundation. The publications focused on the North-South dialogue, development, international economic relations and other global issues affecting developing countries.

The relationship brought together complementary strengths. Abedi provided the initiative, financial support and international relationships, while Gauhar contributed editorial leadership, political understanding and organisational direction.

Altaf Gauhar should therefore be recognised not merely as someone associated with the Third World Foundation, but as a central figure in its development and as one of Abedi’s most important intellectual and organisational associates.

Shridath Ramphal

Diplomat, international statesman and advocate for the developing world
Shridath “Sonny” Ramphal served as Commonwealth Secretary-General from 1975 to 1990 and became one of the most influential international advocates for developing countries.

He was associated with Abedi through the Third World Foundation, educational initiatives and wider discussions about international economic cooperation.

Ramphal brought to these activities considerable experience in diplomacy, Commonwealth affairs, regional cooperation and relations between developed and developing countries. He was also involved in major international commissions considering development, the environment, disarmament and global governance.

His views corresponded with many of the concerns that led Abedi to establish the Third World Foundation: economic inequality, the limited influence of developing countries within established international institutions and the need for a stronger voice in global affairs.

Ramphal was also connected with the Cambridge Commonwealth Trust and its work supporting students from Commonwealth countries.

His association with Abedi therefore crossed several categories. He was an international public figure, diplomat, development advocate and supporter of educational cooperation.

Ramphal was not involved in the management of BCCI. His importance lies in the ideas and institutions with which he and Abedi were jointly associated.

James Callaghan

Public service, development and educational opportunity
Former British Prime Minister James Callaghan, later Lord Callaghan of Cardiff, appears in this group because his association with Abedi extended beyond his former political office.

He participated in activities connected with the Third World Foundation and was associated with Abedi through the Cambridge Commonwealth Trust.

The Trust was established to help students from Commonwealth countries study at the University of Cambridge. Abedi and BCCI provided substantial financial support for scholarships, while Callaghan’s involvement gave the initiative public standing and connected it with wider Commonwealth interests.

Callaghan reportedly met Abedi through charitable activity connected with the Trust. Their subsequent association developed around education and international development.

His involvement illustrates how Abedi built relationships with people who could contribute experience, public confidence and institutional connections to initiatives outside BCCI’s ordinary commercial activities.

Callaghan did not manage BCCI. Nor should his participation in a trust or foundation be treated as an endorsement of every aspect of the Bank’s conduct. His relevance here is to the development of educational and public-interest institutions supported by Abedi.

Lord Carrington

Diplomat, public figure and educational trustee
Peter Carington, Lord Carrington, had a long career in British government, diplomacy and international affairs. He served in several senior offices, including Foreign Secretary, and later became Secretary General of NATO.

Contemporary BCCI material recorded Lord Carrington among the international figures associated with the Cambridge Commonwealth Trust.

His participation reflected the standing of the Trust and the breadth of the network supporting its educational objectives. The Trust brought together public figures, diplomats, former national leaders and individuals from Commonwealth countries to expand access to education at Cambridge.

Lord Carrington’s inclusion should be confined to the documented institutional association. It does not establish that he had a role in BCCI or that he maintained a close personal relationship with Abedi.

His profile nevertheless helps demonstrate that Abedi’s educational initiatives were connected with recognised figures from British and international public life.

L. K. Jha

Economist, diplomat and public servant
Lakshmi Kant Jha, generally known as L. K. Jha, was a distinguished Indian economist, diplomat and public servant.

His career included senior responsibilities in Indian government and international affairs. He served as Governor of the Reserve Bank of India, India’s ambassador to the United States and in other important public positions.

Contemporary material associated Jha with Abedi and other international figures through the Cambridge Commonwealth Trust.

His background in central banking, economics and diplomacy made him particularly relevant to the combination of interests represented in Abedi’s wider network.

Jha’s association shows that the people brought together through educational initiatives were not included merely for ceremonial purposes. Many possessed substantial experience of banking, public administration, economics or international relations.

The available record should nevertheless distinguish his work with the Trust from any suggestion that he participated in BCCI’s management or commercial decision-making.

Professor Amartya Sen

Economist and contributor to development thought
Economist Amartya Sen was among the academic figures associated with the work of the Third World Foundation.

At the time, Sen was already widely respected for his work on poverty, inequality, famine, welfare economics and development. He later received the Nobel Memorial Prize in Economic Sciences.

His research was particularly relevant to the Foundation’s objectives. Rather than considering development simply in terms of national income or economic growth, Sen’s work examined hunger, deprivation, social opportunity and the ability of people to lead meaningful lives.

The participation of scholars such as Sen helped give intellectual depth to the Foundation’s work. It demonstrated that the organisation sought to engage serious academic thinking rather than operate merely as a public-relations platform for BCCI.

Sen’s inclusion records an academic and institutional association. It should not imply any involvement in BCCI’s banking activities or endorsement of the Bank.

His connection belongs within the broader history of the Third World Foundation as a forum where economists, policymakers and international public figures could examine development from perspectives that were often insufficiently represented in established institutions.

K. Soedjatmoko

Indonesian intellectual, diplomat and university leader
Soedjatmoko was an Indonesian intellectual, diplomat and development thinker who later served as Rector of the United Nations University.

He was among the academic and international figures associated with the Third World Foundation.

Soedjatmoko wrote and spoke extensively about development, social change, education and the need for developing countries to build their own intellectual and institutional capacity.

These interests closely corresponded with Abedi’s belief that lasting development required more than financial assistance. It also required research, education, trained people and institutions capable of understanding local conditions.

His involvement illustrates the international character of the Foundation. It brought together contributors from Asia, Africa, the Caribbean, Europe and other regions rather than limiting discussion to Western academic or financial centres.

Soedjatmoko’s association with Abedi was intellectual and institutional. There is no basis for treating it as involvement in the management of BCCI.

Azim Husain

Diplomat and contributor to the Third World Foundation
Azim Husain was an experienced Indian diplomat whose career included service as a senior diplomatic representative in the United Kingdom and as ambassador in the Middle East.

He became associated with the Third World Foundation and its efforts to promote research and international discussion about development.

Husain’s diplomatic experience was particularly relevant to an organisation seeking to connect political leaders, economists, academics and public institutions across different regions.

His involvement also reflected the breadth of Abedi’s relationships in the Indian subcontinent. Although Abedi built his principal banking career in Pakistan and internationally, his network was not confined by national boundaries.

Husain belongs in this group because his contribution arose through diplomacy, public life and institutional cooperation rather than commercial banking.

A fuller profile should identify his precise responsibilities within the Foundation from its records and distinguish formal appointments from attendance at individual events.

The Bank of America relationship

Bank of America deserves separate consideration as an institution because of its importance to BCCI’s early history.

Its participation contributed:

initial capital;
international credibility;
access to banking facilities;
reassurance for regulators and potential customers;
knowledge of international banking practices; and
association with one of the world’s largest established banks.

The relationship also helps place BCCI’s origins in context. BCCI was not initially presented to regulators as a bank operating outside the recognised international financial system. It began with the participation of a major American financial institution and with shareholders from the Gulf.

Bank of America was a minority shareholder and did not assume responsibility for BCCI’s day-to-day management. Its participation should therefore be neither exaggerated nor overlooked.

The distinction between institutional support and management responsibility is essential to an accurate account.

The Cambridge Commonwealth Trust

The Cambridge Commonwealth Trust provides another important institutional setting for Abedi’s relationships.

Established in 1982, the Trust sought to help students from Commonwealth countries undertake studies at the University of Cambridge.

BCCI and Abedi supported scholarships, enabling students from developing countries to obtain educational opportunities that might otherwise have been beyond their financial means.

Contemporary material recorded Abedi as a trustee alongside figures including:

James Callaghan;
Kenneth Kaunda;
Lord Carrington;
L. K. Jha; and
Shridath Ramphal.

The composition of the Trust reflected Abedi’s ability to bring together former national leaders, diplomats, economists and public figures around a defined educational purpose.

Scholarship support was consistent with Abedi’s wider belief that developing countries required trained people and strong educational institutions if they were to achieve greater economic independence.

The Trust also provides an example of a relationship that should not be described simply as charitable patronage. It involved continuing institutional cooperation with a recognised university and with figures from different parts of the Commonwealth.

The Third World Foundation as an intellectual network

The Third World Foundation created another important network of professional and public relationships.

It brought together:

economists and development specialists;
national leaders and former heads of government;
academics and university figures;
diplomats and international officials;
writers and publishers; and
people involved in public policy.

The Foundation’s activities included lectures, conferences, publications and the Third World Prize. It also supported Third World Quarterly, which developed into a recognised journal concerned with international affairs and development.

Through the Foundation, Abedi sought to create a platform from which developing countries could examine their own problems, present their own perspectives and contribute more directly to international debate.

The participation of recognised economists, diplomats and public figures gave the Foundation intellectual credibility beyond its financial association with BCCI.

Banking relationships and institutional credibility

Personal and institutional relationships played an important part in BCCI’s growth.

For a young bank entering new countries, association with established institutions and respected individuals could:

strengthen confidence among customers and counterparties;
assist communication with governments and regulators;
provide access to professional expertise;
improve understanding of unfamiliar markets;
support recruitment and management development; and
create opportunities for wider institutional cooperation.

These benefits were not unique to BCCI. International banking has always depended heavily upon confidence, reputation and networks of professional relationships.

What distinguished Abedi’s approach was the extent to which he sought to carry those relationships into other fields, particularly education and development.

Different associations must be distinguished

It would be misleading to describe every person in this section as a friend, adviser or business partner of Abedi.

The documented relationships include several different categories:

a relationship between BCCI and another bank;
professional or economic consultancy;
service on the same trust or foundation;
participation in a conference or publication;
cooperation on an educational initiative;
contact through diplomacy or public office; and
a continuing personal or professional relationship.

Each profile should identify the appropriate category and avoid conclusions that go beyond the available evidence.

In particular, membership of a trust, participation in a conference or appearance in a photograph does not establish knowledge of BCCI’s internal affairs.

A note on interpretation

Inclusion in this section does not imply that a person:

participated in BCCI’s management;
approved BCCI’s lending or accounting decisions;
knew about wrongdoing later alleged against particular officers or customers;
endorsed every aspect of Abedi’s business activities;
obtained an improper benefit from the association; or
maintained a close personal friendship with Abedi.

The purpose is to document historically relevant relationships and explain the institutions, ideas or activities through which they arose.

Where evidence establishes only an institutional connection or attendance at a particular event, the profile should say so clearly.

An evolving record

This is not a complete list of the bankers, economists, academics, diplomats, business leaders and public figures associated with Agha Hasan Abedi.

Additional profiles may be added as correspondence, institutional records, BCCI publications, university archives, speeches, photographs and independent sources are examined.

Together, these relationships show that Abedi’s international network extended well beyond conventional banking. It included people and institutions capable of contributing capital, professional expertise, ideas, education and public service.

They also reflect a central feature of Abedi’s philosophy: banking began with relationships, but those relationships could develop into wider cooperation in business, education, economic policy and international development.

Also read

Research Note

This account reflects the documentary material available at the time of writing. Profiles may be revised as further correspondence, institutional archives and independent records become available. Inclusion does not imply participation in BCCI’s management or knowledge of any alleged wrongdoing.