'Significant Progress': Financial Action Task Force Removes Pakistan from its 'Grey List'
New Delhi: After more than four years, the global watchdog, Financial Action Task Force (FATF), has removed Pakistan from its ‘grey list’ after giving it a clean bill of health over its financial reforms combating terror financing.
In its first response, India said that Pakistan took “some action” against 26/11 terrorists only because it was under enhanced FATF scrutiny. But, New Delhi added that the international community should keep a close eye on Islamabad “in global interests”.
Since 2018, Pakistan has been on the list of the Financial Action Task Force (FATF)’s “Jurisdictions under Increased Monitoring”, known colloquially as the ‘grey list’. Countries on this list are determined to have “strategic deficiencies” in implementing an effective legal regime to combat money laundering and terror financing.
After the two-day plenary in Paris, FATF welcomed Pakistan’s “significant progress in improving its AML/CFT regime.”
“Pakistan has strengthened the effectiveness of its AML/CFT regime and addressed technical deficiencies to meet the commitments of its action plans regarding strategic deficiencies that the FATF identified in June 2018 and June 2021, the latter of which was completed in advance of the deadlines, encompassing 34 action items in total. Pakistan is therefore no longer subject to the FATF’s increased monitoring process,” announced the FATF.
At a press conference, FATF President, Singapore’s T. Raja Kumar said that “FATF team has verified that reforms are in place and there is high-level commitment at the political level and capacity to sustain those reforms”.
He added that Pakistan’s removal from ‘grey list’ doesn’t mean that there won’t be more work to do. Pakistan will continue to work with FATF’s regional partner, Asia Pacific Group, to further improve its anti-money laundering and combating financing terrorism system.
Along with Pakistan, FATF also removed Nicaragua, while adding DR Congo, Tanzania and Mozambique to the ’grey list. The international watchdog added Myanmar to the ‘black list’, which already included North Korea and Iran.
Over the years, Pakistan has repeatedly accused the Indian government of politicising the FATF, while New Delhi has pointed out that Islamabad had not taken action against terror groups targeting India.
The timing of Islamabad’s removal, which comes at a time of severe economic crisis, coincides with its warming ties with the United States.
India's response
After the announcement in Paris, India gave a guarded response. Noting Pakistan’s exit from the grey list, MEA spokesperson Arindam Bagchi highlighted that Islamabad will have to “continue to work with the Asia Pacific Group on Money Laundering (APG) to further improve its Anti Money Laundering (AML) /Counter Terror Financing (CFT) system”.
He also asserted that Pakistani presence on the grey list led to prosecutions against 26/11 masterminds. “As a result of FATF scrutiny, Pakistan has been forced to take some action against well-known terrorists, including those involved in attacks against the entire international community in Mumbai on 26/11,” he said.
In April this year, 26/11 mastermind and Jamaat-ud-Daawa supremo Hafeez Saeed was sent to jail for 33 years in two new terror financing cases. Similarly, top Lashkar-e-Taiba terrorist Sajid Mir was sentenced to 15 and half years in June.
However, India had not made any official comments about these two convictions. Therefore, Bagchi’s reference to Pakistan having taken “some action” against 26/11 terrorists was the first such acknowledgement by India.
The MEA spokesperson also stated that it was in “global interest that the world remains clear that Pakistan must continue to take credible, verifiable, irreversible and sustained action against terrorism and terrorist financing emanating from territories under its control”.
Over the last one year, it became largely clear that the last roadblock in Pakistan’s path to get out of the grey list was over its weak record of prosecution against UN-proscribed terrorists.
From June this year, India had along with the United States and France submitted five separate proposals before a UN Security Council’s committee to include Pakistan-based terrorists in its sanctions regime. China put a technical hold on all five names.
Ahead of the FATF plenary, Pakistan had also claimed that there “orchestrated malevolent campaign against Pakistan by Indian media”.
'Vindication,' says Pakistan
Following the announcement, Pakistan prime minister Shahbaz Sharif said that the removal from “FATF grey list is a vindication of the country’s determined and sustained efforts over the years”.
“I would like to congratulate our civil & military leadership as well as all institutions whose hard work led to today's success,” he tweeted.
Sharif specifically commended the role and efforts of Army chief Qamar Javed Bajwa and foreign minister Bilawal Bhutto Zardari. He also congratulated “all political parties” for putting up an united front.
Pakistan 🇵🇰 exiting the FATF grey list is a vindication of our determined and sustained efforts over the years. I would like to congratulate our civil & military leadership as well as all institutions whose hard work led to today's success. Aap sab ko bohat bohat Mubarak 🙂
— Shehbaz Sharif (@CMShehbaz) October 21, 2022
I would particularly commend the role & efforts of Foreign Minister Bilawal Bhutto, Army Chief General Qamar Javed Bajwa and their teams & all political parties for putting up a united front to get Pakistan out of the grey list. Alhumdulillah! https://t.co/LkX5tupMQe
— Shehbaz Sharif (@CMShehbaz) October 21, 2022
The principal opposition party was quick to take credit. Former federal minister for economic affairs and PTI leader Hammad Azhar claimed that Pakistan’s exit was only possible due to steps taken by the country from October 2018 to March 2022, when PTI government under Imran Khan was in power.
فیٹف نے اکتوبر 2018 سے مارچ 2022 تک اٹھائے گئے اقدامات کو سامنے رکھ کے گرے لسٹ سے پاکستان کو خارج کر دیا۔ پوری قوم اور حصوصی طور پر وہ افسران جو اس عمل میں 3 سال شامل رہے مبارکباد کے مستحق ہیں۔ pic.twitter.com/h1lWWQlpZh
— Hammad Azhar (@Hammad_Azhar) October 21, 2022
Note: This copy, first published at 9:25 pm on October 21, was updated with a response to the development from India at 12:08 am on October 22.
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