INTRODUCTION
Pakistan is wading through troubled waters.
For a long time, the Financial Action Task Force(FATF) which monitors and tackles money laundering and International terror funding, had placed Pakistan in its grey list as a precursor of black listing the rogue nations, like Iran and North Korea. Adding to its woes, the economic slump coupled with America’s hesitance to pump in dollars to Pak exchequer, have put Pakistan into a tail-spin, which it finds difficult to recover.
A FAILED NATION
Presently Pakistan is in deep economic crisis and is at the mercy of IMF, inflicting pain on the common man through policies of austerity. The government machinery could never collect taxes efficiently and is now forced to collect fund through price hikes that affect the rich less, but the common man more. Though a majority of the economic observers say that the year 2020, is going to break the economic back-bone of the nation, however, the ruling Pakistan Tehreek-e- Insaf (PTI) is optimistic that the new economic policy of austerity and high taxation will reboot the economy.
The year 2020 may bring more grief for Pakistan from its Arab friends.PM Imran Khan wanted to attend an Islamic conference convened by Malaysia in January after Turkey and Malaysia together condemned India’s action in Kashmir. Pak foreign office advised Khan against his desire, as Arab patron countries had seen the conference as a “divider” of the Muslim world. However, after Saudi Arabia failed to convene OIC( Organization of Islamic States)Â conference to protest Indian action in Kashmir in January, PM Khan did go to Kuala Lumpur on a bilateral visit.
Prime Minister Khan’s dramatic performance regards Kashmir issue is not cutting ice with Pak’s Muslim neighborhood. On February 5, the “Kashmir Day” Imran Khan was in PoK telling the opposition PPP government there that” India will lose Kashmir this year”, much to the amusement of world nations. He still expects world nations putting pressure on India to tow the Pak line of protest, on India revoking Article 370 last year.
RAY OF HOPE FOR PAKISTAN
However, PM Imran Khan revel in the hope that his country may be out of the ‘Grey List’ of the international terror financing watchdog FATF next month, due to the active support of China and tactical support of some Western countries.However, the latest scenario proves otherwise.There are valid reasons to believe that pakistan will continue to remain in the grey list of FATF, since it is not fully compliant on 13 of the 27 actions,which are mostly pertaining to terror funding.
At a meeting of the Financial Action Task Force (FATF) held in Beijing, Islamabad submitted its compliance report and got support from the FATF current chair and its “all-weather friend” China and a few Western powers.
China, which hosted the key meeting of the international terror financing watchdog, said on Thursday that Pakistan has made “visible progress” to strengthen its counter-terrorism financing system, which should be encouraged by the world community.
The Paris-based Financial Action Task Force (FATF) Asia Pacific Joint Group met in Beijing this week to scrutinise Pakistan’s progress report to adopt stricter laws against terror financing and money laundering. China is the President of the FATF and co-chair for Asia Pacific Joint Group.
A Pakistani delegation led by Minister for Economic Affairs Division Hammad Azhar is in Beijing to brief the financial task force about the steps taken by Islamabad to implement the recommendations made by the FATF.Pakistan may be out of FATF grey list by February due to support from all-weather ally China.
“We hope the FATF will continue to offer constructive support and assistance to Pakistan in its continued efforts to improve the counter-terrorism financing system and effectively fighting the terrorist financing,” Beijing announced.
“The next plenary of the FATF will be held in February in Paris and Pakistan needs just 12 votes out of 39 to exit the ‘Grey List’ and move to ‘White List’. There is a strong possibility of Islamabad getting enough support to exit the ‘Grey List’,” an Indian official privy to the development said. It’s a matter of concern for India that Pakistan is capable of coming out of this crisis, even without carrying out a sincere effort to weed out Jihadis from its soil. It’s significant to note that, besides China, and Saudi Arabia, Malaysia and Turkey also have declared their solidarity with Pakistan.
If Pakistan could convince a few Western nations with their report of taking action against terrorists, the country will be out of FATF ‘Grey List’, which will be a cause of worry for India.
If Pakistan comes out of the FATF ‘Grey List’, it will be easy for the country to get financial aid from the IMF, World Bank, ADB and the European Union, helping it to improve its precarious financial situation.
The FATF in October last decided to keep Pakistan on its ‘Grey list’ for failure to curb funneling of funds to terror groups Lashkar-e-Taiba, Jaish-e-Mohammad and others. If not removed off the list by April, Pakistan may move to a blacklist of countries that face severe economic sanctions, such as Iran.
Pakistan has submitted a 650-page review report to the FATF on 8 Jan 2020.The report was submitted in response to 150 questions raised by the FATF regarding new Pakistani policies on money laundering.
The FATF is backed by the UN. Security Council passed resolutions which made its recommendations binding and in case of deficiencies, sanctions could be imposed.
Pakistan was placed on the ‘Grey List’ by the FATF in June 2018 and was given a plan of action to complete it by October 2019 or face the risk of being placed on the blacklist along with Iran and North Korea.To escape the wrath pf FATF,a Pakistani Court had this week, sentenced Lashkar-e-Taiba founder hafiz Saeed on terror financing charges.He had been earlier designated a global terrorist by the United Nations.Due to the pressure of US, he was arrested on July 17,2019,in a terror financing case by Pak government.This action stands in favour of Pakistan.However,to come out of Grey list, Pakistan needs 12 votes out of 39.But it needs only 3 votes to avoid falling into the FATF black List”,which seems unlikely.
FATF is an inter-governmental body established in 1989 to combat money laundering, terrorist financing and other related threats to the integrity of the international financial system.The FATF currently has 35 members and two regional organisations — the European Commission and Gulf Cooperation Council.
CONCLUSION
Pakistan may wriggle out from the FATF whirlpool, buts its troubles are far from over. The opposition PPP and PMLN leaders are hounded by corruption charges and the courts are dragging their feet to dispense verdicts. Trouble is brewing among the public. A special Anti- Corruption Agency ,The National Accountability Bureau( NAB), arresting these powerful leaders and keeping them in ramshackle prisons without charging them , has not gone well with a considerable section of people.
Most Economists think that the year 2020 will be a “Year of Doom” for Pakistan. The riddle is the extent of foreign aid, PM Imran Khan can amass from friendly nations to pull Pakistan out from a pit of debts and anarchy.
Jai Hind.