Pakistan will remain on the Financial Action Task Force (FATF) grey list. The decision was taken in the FATF's plenary session after Islamabad failed to take appropriate action against UN-designated terrorists such as 26/11 accused Hafiz Saeed and JeM chief Masood Azhar.
Why Pakistan is still in Grey List:-
- THE FINANCIAL Action Task Force (FATF) has refused to take Pakistan out of the ‘Grey List’ yet again.
- On Friday 25th June, it said Pakistan had failed to take appropriate action against UN-designated terrorists such as 26/11 accused Hafiz Saeed and JeM chief Masood Azhar.
- Although the global anti-money laundering and terror financing body has acknowledged some progress made by Pakistan, it said the country should continue to work to address its strategically-important deficiencies.
- FATF president Marcus Pleyer said the decision was taken at the conclusion of the virtual plenary of the Paris-based organisation.
- Pakistan continues to remain on “increased monitoring list”, Pleyer said at a virtual press conference.
- “Increased monitoring list” is the another name for the Grey List.
- Pleyer said Pakistan has now completed 26 of the 27 action items given to it in 2018. The FATF has asked Pakistan to take action against UN designated terrorists, he said.
- Significance:
- In Pakistan's case, the FATF has taken cognisance of the inaction against several banned organisations involved in raising funds for terror activities and those linked to global terrorists like Jaish-e-Mohammed chief Masood Azhar and Lashkar-e-Taiba’s Hafiz Saeed and its operations chief Zaki-Ur Rahman Lakhvi.
- On several occasions, India has also raised the involvement of elements within Pakistan in a number of terror cases, including the 26/11 Mumbai and Pulwama attacks.
- Perpetual containment of Pakistan on the grey list of FATF would further pressurise Pakistan to take adequate measures to prevent such terrorist attacks on India from its soil.
Countries Under Black List
- As of 2020, there are only two countries on the FATF's black list- North Korea and Iran.
About Financial Action Task Force
- The Financial Action Task Force (FATF) is an inter-governmental body established in 1989 during the G7 Summit in Paris.
- The objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system.
- Its Secretariat is located at the Organisation for Economic Cooperation and Development (OECD) headquarters in Paris.
- Member Countries: As of 2019, it consists of thirty-seven member jurisdictions. India is one of the members.
- Sessions: The FATF Plenary is the decision making body of the FATF. It meets three times per year.
FATF has two lists:
- Grey List: Countries that are considered safe haven for supporting terror funding and money laundering are put in the FATF grey list. This inclusion serves as a warning to the country that it may enter the blacklist.
- Black List: Countries known as Non-Cooperative Countries or Territories (NCCTs) are put in the blacklist. These countries support terror funding and money laundering activities. The FATF revises the blacklist regularly, adding or deleting entries.
- The FATF Plenary is the decision making body of the FATF. It meets three times per year.
Impact on Pakistan:
- By remaining on the “Grey List”, it would be difficult for Pakistan to get financial aid from the International Monetary Fund (IMF), World Bank and European Union, making its financial condition more precarious.
- Unlike the next level “blacklist”, greylisting carries no legal sanctions, but it attracts economic strictures and restricts a country’s access to international loans.
- Pakistan’s Foreign Minister had estimated a loss of $10 billion annually to the Pakistani economy for every year Pakistan has been on the greylist.
Source: Indian Express
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