Pakistan on FATF’s grey list
Muhammad Jamil


On Friday, the Financial Action Task Force (FATF) officially notified Pakistan on its ‘grey list’. The decision to place Pakistan on grey list had been taken in FATF’s meeting in February 2018, and it took effect after negotiating an action plan to overcome deficiencies. Pakistan’s interim Finance Minister Shamshad Akhtar was in Paris to defend the country in FATF’s meeting, who apprised the anti-terror financing body of measures that country had taken to combat money laundering, terrorist financing and to eliminate the terrorism from its soil. As a part of efforts to implement the FATF counter-terrorist financing operational plan adopted in February this year, the Securities and Exchange Commission of Pakistan (SECP) on 20th June issued the ‘Anti Money Laundering and Countering Financing of Terrorism Regulations 2018’. Last week, the interim finance minister said that the ministry had improved institutional mechanisms for handling anti-money laundering and countering financing terrorism issues.

The FATF is an inter-governmental body established in 1989 to combat money laundering, terrorist financing and other related threats to the integrity of the international financial system. However, it is under the influence of the US and the West with the result that Sword of Damocles would continue to hang on the countries that do not fall in line with them. In fact, US President Donald Trump is pursuing the policy to weaken Pakistan and bring its army and institutions into disrepute. No matter what measures Pakistan takes to satisfy him he will stick to his policy. Pakistan was previously on the grey list from 2012 to 2015, and its name was removed from the grey list in February 2015 arguably reward Nawaz Sharif for being compliant. It is not understandable that when Pakistan military has conducted operations and completely destroyed terrorist infrastructure and network, its name has been placed on grey list.
It was obvious from Dawn leaks that effort was made to blame military for its inability to take action against banned outfits as demanded by the US. This time round, after much debate and speculation following the February Financial Action Task Force (FATF) plenary, it was a foregone conclusion that Pakistan would be placed on the FATF grey-list in June. Some analysts are of the view that the grey-listing will adversely impact Pakistan’s economy and make it harder for the country to meet its mounting foreign financing needs, including potential future borrowings from the International Monetary Fund. They also argue that the grey-listing could lead to a downgrade in Pakistan’s debt ratings, making it more difficult to secure funds through international bond markets. However, evidence suggests that these assertions are simply incorrect, as Pakistan was on the FATF grey-list from 2012 to 2015, a period during which it successfully completed an IMF program.
Since coming to power, the Trump administration has made a concerted effort to coerce Pakistan into ending its support of non-state armed groups such as the Haqqani Network. However, release of Hafiz Saeed, the man India holds responsible for the 2008 terror attacks in Mumbai, from house arrest in November of 2017 under the orders of the courts had angered the US. President Donald Trump via Twitter had then said: “Pakistan had given the United States nothing but lies & deceit.” The United States then suspended assistance of over $1 billion military assistance and the release of Coalition Support Funds (CSF) – money the United States owed to Pakistan, which was reimbursement of the money spent on military operations against militants in FATA to decimate them so that they do not cross the border to conduct vile acts.
Pakistan had taken measures to satisfy the US. President Mamnoon Hussain had issued an ordinance that amended the country’s 1997 Anti-Terrorism Act and placed Hafiz Saeed’s Jamaat-ud-Dawa (JuD) and Falah-i-Insaniat Foundation (FIF) on the country’s banned organizations list. The government followed up by taking over both organizations’ assets, which included thousands of staff and volunteers and dozens of schools and clinics. The JuD had been declared a terrorist front group by the United Nations Security Council in 2008, whereas it was banned in Pakistan in late 2017. United States officials have also said that they have not seen any visible action by the Pakistanis against the Haqqani Network and its facilitators. Problem is that when Nawaz Sharif former prime minister of Pakistan gives a confessional statement about establishment not taking actions against terror outfits, the US and the West would take his words seriously.
Since the time former prime minister Nawaz Sharif was disqualified by five-member bench of the Supreme Court, he had started a tirade against the court’s verdict as well as the judges, and also insinuated that military establishment was behind that move to get him disqualified. In an interview with national English daily he had said: “Militant organisations are active. Call them non-state actors, should we allow them to cross the border and kill 150 people in Mumbai? Explain it to me. Why can’t we complete the trial?” It was a reference to the Mumbai attacks-related trials stalled in a Rawalpindi anti-terrorism court. It is too well-known that trial could not be completed because India did not allow access to the witnesses. Yet he said: “We have isolated ourselves. Despite giving sacrifices, our narrative is not being accepted. Afghanistan’s narrative is being accepted, but ours is not. We must look into it.”