NEW DELHI: The possibility of Pakistan being put in the Financial Action Task Force (FATF) black list, which seemed inevitable till late last year, seems to have almost ended, official sources covering the developments have said. When the FATF’s plenary group meets in Paris between 16-21 February to formally announce what it thinks of Pakistan’s performance on tackling money laundering and terror financing, it is likely, at the most, to keep it in the grey list, the same classification under which it presently is. The chances of Pakistan being taken off the grey and put it into the while list, by the end of this year, if not in February, too was “very strong”, one official hinted.
When the FATF had released the Mutual Evaluation Report of Pakistan in October last year, it had emerged that Pakistan had failed to take enough action to stop terror financing in the country which headquarters groups like Lashkar-e-Tayyaba, Haqqani network and Jaish-e-Mohammed.
Pakistan at that time was awarded the classification of “significant deficiencies” on both the parameters of “effectiveness ratings” and “technical compliance ratings”. Of the 11 parameters that constitute the “Effectiveness ratings”, that shows how the country has performed while dealing with money laundering and combating the financing of terror, Pakistan had got “low” rating in 10 of the 11 parameters, while it got “moderate” for “international cooperation”.
The FATF had had placed Pakistan on its “grey list” in June 2018, giving the country a 15-month deadline to implement its 27-point action plan, a deadline which ended in September 2019. It was first placed in the list in 2012, where it stayed there till 2015. Official sources said that the very strong likelihood of Pakistan not being put in the “black list” in the Paris meet, was mostly attributable to external factors rather than Pakistan taking any significant step to tackle terror financing.
In the FATF review meeting, that was held in Beijing between 21-23 January, Pakistan was able to convince China, the United States and other European countries that comprises the 37-member countries (plus two regional organisations—European Commission and Gulf Cooperation Council) which comprises FATF that it had taken effective steps to counter terror financing.
Sources said that in Beijing, Pakistan had submitted a 125-page report that does not include 500 pages of annexures to show the steps that it had taken in the last six months to control terror financing.
The same chain of events is expected to take place in Paris next month. Pakistan requires the support of 12 members of the 39 members to come out from the grey list and it is expected that with US and UK supporting Pakistan, just like in Beijing, apart from Turkey and Malaysia, its “baptism” is merely a formality. “Pakistan’s worth has increased after the US decided to withdraw troops from Afghanistan. US needs Pakistan on its side so that the Taliban does not create an unfavourable situation in wake of the US withdrawal. What China would do when it comes to Pakistan is not a secret. The fact that Pakistan for the last 6-7 months has to a great extent, kept the terror groups ‘hidden’ and ‘dormant’, too, has added to the script that Pakistan has now become serious when it comes to tackling terrorism,” a senior government official said.
According to him, the favourable response Pakistan was receiving from the Western countries was not a testament to either the success of its own diplomacy or the failure of the Indian diplomacy. “The US and China have their own interests when it comes to Pakistan. For US, right now, keeping Pakistan in the good books is important and for most of the member countries, they follow what the US does when it comes to Pakistan,” he added. China presently holds the presidency of FATF. The FATF president is a senior official appointed by the FATF Plenary from among its members for a term of one year. The term of the president begins on 1 July and ends on 30 June of the following year. The present president, Xiangmin Liu from China, assumed the position of president of the FATF on 1 July 2019. Liu, before his appointment, served as Director-General of the Legal Department at the People’s Bank of China, China’s central bank. He succeeded Marshall Billingslea of the United States.
Just days before the January Beijing review meet, Pakistan Foreign Minister Shah Mehmood Qureshi went to the United States and meet senior US officials, including secretary of state, Mike Pompeo, and urged them to ensure that Pakistan gets off the FATF grey list.
On 26 January, Alice Wells, the US principal deputy assistant secretary of state for South and Central Asian affairs, “acknowledged” Pakistan’s efforts and expressed US pleasure for meeting the obligations of the FATF, while adding that the US was ready to assist Islamabad in implementing them. During the same time period, Pakistan also reached out to the United Kingdom and asked it to play its role in removing Pakistan’s name from the grey list. The UK on 25 January, incidentally, just days before the Paris meet, has revised its travel advisory on Pakistan declaring it as a “family station” for the British diplomats and citizens. UK officials while upgrading the classification had attributed it to the improved security situation in the country. This was the first travel advisory update done by the UK with regards to Pakistan since 2015. Last week, Pakistan announced that it was going to introduce major amendments to at least a dozen of its laws over the next six months to remain in continuous compliance with requirements of the FATF. “All these announcements and government orders will be used by Pakistan to present its case in Paris,” the official quoted above said.
However, the real picture, of terror groups like Lashkar and Jaish still functioning openly in Pakistan is likely to be ignored by Western countries. “Does Pakistan believe that everyone will accept Pakistan’s contention that Hafeez Saeed and Masood Azhar have been silenced now? Everyone knows the truth. Intelligence agencies from multiple countries have a strong presence in Pakistan and they know the ground situation. Pakistan may be able to escape the black list, but that does not change facts. It raises question on how effective instruments like FATF are. Does it not?” a senior intelligence official asked.