In October 2021, the Financial Action Task Force (FATF) once again decided to keep Pakistan in the financial watchdog’s grey list; while noting that “good progress” has been made in completing the required action items for removal from the list. Pakistan was retained on the grey list despite meeting all requirements. Due to continued and prolonged retention in the grey list, Pakistan has suffered huge losses estimated to be USD 38 billion. The economic losses due to the FATF restrictions are casting corresponding detrimental effects on the life of ordinary Pakistanis. In addition to ill effects of Covid 19 pandemic, FATF limitations have further decelerated Pakistan’s economic progression.
It has been learnt from different quarters that FATF’s decision to keep Islamabad on its grey list is basically political and influenced by United States. Pakistan’s Premier, Imran Khan’s famous remarks of “absolutely not” regarding granting military ‘bases’ to the U.S. could have negatively impacted the prospects of its deletion from the grey list. FATF’s biased approach towards Pakistan in fact is not a single instance but can be contextualized in the larger picture and pattern of U.S.-Pakistan relations. Washington is not only the prominent financer of FATF, but when Pakistan was put on grey listed back in 2018; Mr. Marshall Billingslea from U.S. Department of the Treasury was the watchdog’s president and also heading the Office of Terrorist Financing and Financial Crimes.
A quantitative analysis of non-compliance to FATF by other countries shows that Pakistan has so far achieved major targets and based on the non-compliance data, Pakistan score is almost same to that of the United States. This data also clearly establishes that Pakistan is more compliant than India and many other countries. Details are shown below in an info graph – prepared by Islamabad Policy Research Institute.
As per its charter, FATF is a technical forum assigned to dispassionately monitor money laundering and terror financing and grade the countries through a fool proof technical mechanism rather than taking cue from political affairs and taking politically motivated decision in light of political dynamics and media framing. Royal United Services Institute (RUSI), in its extensive 2020 report has admitted that FATF is politically oriented and being used as a leverage tool by the Western powers, especially the United States. The recent FATF declaration on Islamabad reveals clearly that this is not the 27-point action plan; it demands the complete submission of Pakistan, particularly about the developing situation in the region, to serve U.S. besides India’s strategic objectives based on her deep animosity towards Pakistan.
India, a permanent member of FATF, has long vouched for harsh sanctions on Pakistan. New Delhi has been using the FATF forum in enforcing a tough stance against Islamabad. Indian External Affairs Minister Jaishankar has recently admitted that India had ensured that Pakistan continues to suffer on the FATF grey list. Meanwhile, Pakistan has presented proofs that India is offering arms and training to terrorists to destabilize Pakistan. The terrorist attack in Lahore on 23 June 2021 was a clear indication of the Indian nefarious designs against Pakistan. India has also been sending arms and ammunition in Afghanistan to orchestrate terrorist activities in Pakistan. In 2020, a UN report on terrorism, titled “The 26th report of the Analytical Support and Sanctions Monitoring Team concerning ISIS, Al-Qaeda and associated individuals and entities,” has also highlighted the grim reality that there are a significant number of ISIS terrorists in two major states of India, Kerala and Karnataka. UN report also highlighted that India is financing and supporting terrorism but FATF has still remained intentionally oblivious and initiated no action against India while Pakistan was retained on the grey list on the basis of disinformation campaign and political engineering orchestrated by India.
To regain credibility, FATF must consider rejecting the complaint against Islamabad immediately, as it was initiated and lobbied by India and the U.S. to serve their political vendetta. India needs to be made accountable after having been fully exposed of its unholy pursuits by international watchdogs i.e. EU Disinfolab, which unearthed how India coordinated false, unsubstantiated and venomous propaganda to damage the reputation of Pakistan at international level. In fact, discrepancies and discrimination within the FATF structure are most likely designed to force Pakistan and others to submit on numerous issues; in case of Pakistan on issues such as the provision of military bases to U.S., not raising voice on the recent crisis in IIOJK, compromises on Afghanistan, change of domestic laws, and a halt to cooperation with China. While Pakistan subscribes to basic spirit of FATF it certainly cannot fulfil the unending and politically motivated desires of U.S. and India under their pressure of FATF.
World powers, especially the United States, are employing the FATF as a political tool to pursue their strategic interests. The FATF was designed to define rules for dealing with financial crimes, but that is only theoretically true, in reality FATF judgments are mostly based on political motivations. Pakistan along with likeminded affected countries – China, Russia, Iran and Turkey – must raise voice against such unethical political engineering, arm-twisting and manoeuvring practices at FATF.
*Syed Zain Jaffery is a student of Current Affairs and Political Science with a Masters degree from NUST, Islamabad.