Dubai, Oct. 18: In this entrepot city with the Midas touch, there is disbelief that its former resident, Dawood Ibrahim, could have got entangled with al Qaida as alleged by the Americans on Thursday.

This emirate’s officials speculate that Dawood’s handlers in the Pakistani intelligence apparatus may have forced him to surrender his network and his smuggling routes to al Qaida, instead, to facilitate what the Inter Services Intelligence can no longer do for Osama bin Laden and Taliban’s Mullah Omar because of General Pervez Musharraf’s alliance with Washington since September 11, 2001.

Dawood’s name is never mentioned by any official here on record. Officially, he does not exist, but his presence is everywhere for those who know Dubai’s worst kept secrets.

Dubai’s most popular nightspot, a thriving discotheque owned by Dawood by proxy, continues to flourish. So do his properties, businesses, including a hotel, as well as the extortion racket efficiently run from this emirate by his henchmen.

But now all these businesses are managed by the mafia don through remote control from Karachi. Not a single business here is in Dawood’s name. He no longer visits this emirate. After his brother Anees was arrested the last time, his two siblings who had made their home here have packed up and left.

The only near kin of the don is the wife and children of one of his brothers, whom the police have entirely cleared of even peripheral involvement in any illegal activity.

So, Dubai officials say, off the record, of course, that the Americans will not achieve their Thursday objective of freezing or confiscating even a dime of Dawood’s money. They may approach the UN, but on paper, he has no material possessions in this emirate.

If anyone doubted this, it became apparent when a local newspaper ran a story about two hotels in Dubai owned by Dawood associate Sharad Shetty, who was gunned down by the rival Chhota Rajan gang in January this year.

One of the hotels is actually named “Anna Palace” because Sharad Shetty was also known by the alias Anna Shetty. But the newspaper had to carry a retraction after the benami owners of the two hotels proved that Shetty had nothing to do with the properties on paper.

But there is widespread relief in Dubai’s officialdom that the Americans have nailed Dawood down to Karachi.

This means that pressure is no longer on them on account of the charge that the underworld king had made this emirate his home.

Sources here told this correspondent that the Dubai government had, in fact, drawn the attention of Washington to a statement by the inspector- general of Pakistan’s Sindh province that Karachi’s Kawish Crown Plaza, which was ripped up by a bomb last month, actually belonged to Dawood through a benami owner, Ahmed Jamal.

Aftab Sheikh, senior adviser to Sindh’s home ministry, had virtually confirmed Dawood’s presence in Karachi to reporters after the blast, a Dubai official said, although Sheikh subsequently said he had been misquoted.

Contrary to suggestions in India that Thursday’s US action was the result of intelligence cooperation between New Delhi and Washington, sources here said the Dubai government provided free access for American intelligence to records on Dawood’s travels through the emirate’s airport, enabling them to ascertain that he holds a Pakistani passport.

Americans have also been monitoring Dawood’s phone conversations with associates here and Washington precisely knows where the don is talking from and what he is up to, one source said.

Indeed, the United Arab Emirates (UAE) may be about to demand its pound of flesh for having cooperated with the Americans in hooking Dawood.

Sultan bin Nasser al Suwaidi, governor of the country’s Central Bank, told a money laundering conference in the oasis town of Al Ain yesterday that the non-banking hawala system of money transfers was legal in 62 countries and was not used for money laundering or for financing terrorism.

Dubai is the hub of global hawala operations, now under scrutiny by the US treasury.

In support of this argument here that Dawood may have had no choice but to have worked with al Qaida, sources point to a candid statement to US lawmakers by deputy secretary of state Richard Armitage.

“I personally believe that President Musharraf is genuine when he assists us in the tribal areas (where Osama bin Laden is said to be hiding) and he has from inside of the border, but I do not think that affection for working with us extends up and down the rank and file of the Pakistani security community,” Armitage said about three weeks ago.