Pak likely to continue on ‘grey list’ until Feb 2021?

A virtual meeting of the Financial Action Task Force (FATF) plenary scheduled for Oct 21-23 will decide if Pakistan should be excluded from its ‘grey list’, based on a review of Islamabad’s performance to meet global commitments and standards on the fight against money laundering and terror financing (ML&TF).
FATF put Pakistan on its grey list in June 2018 and gave Islamabad a final deadline in February 2020 to implement the remaining 13 out of 27 action points by June 2020, but the deadline was extended up to September due to the COVID-19 pandemic. Former US Secretary of State Madeleine Albright once called Pakistan an ‘international migraine’. The failure to fulfil six key obligations of FATF only indicates Islamabad’s lack of commitment in the fight against money laundering and terror financing. Terror groups operating from its soil continue to be provided immunity.
The virtual plenary of the FATF from October 21 to 23 is likely to retain the country on its grey list. However, if the adverse economic ramifications the tag entails have not pushed Pakistan to mend its ways till now, there is little hope that the desired global standards would be met in the future. FATF’s ability to secure concrete results is under the scanner. On July 28, the Pakistan government reported to parliament compliance with 14 points of the 27-point action plan and with 10 of the 40 recommendations of the FATF.
Pakistan has been repeatedly red-flagged on issues of terror financing and for not acting against proscribed persons and entities but to no avail. According to sources, there is still no consensus amongst the 39-member FATF, which includes the US, UK, France, Germany, China and Russia, to blacklist Pakistan, despite its failure to meet its original deadline in September 2019, which would mean the group maintain status quo and continue Pakistan on ‘grey list’ until February 2021. Unless non-cooperative regimes are made to pay a high cost for their inaction, mere listings will be inconsequential. Islamabad’s expectation of being let off lightly for playing a favourable role in the US-Taliban peace agreement only points to the need for a more effective FATF.

- Prabhakar Purandare

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