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In the grey

Pakistan stays on Financial Action Task Force grey list. It has been slow in adapting to new international dynamic.

By: Editorial |
Updated: June 28, 2021 8:38:41 am
The international costs of Pakistan’s financial transactions have increased and the shadow over international economic support to the nation has darkened.

Reacting sharply against the decision of the international Financial Action Task Force to continue monitoring Pakistan for terror financing and money laundering, Foreign Minister Shah Mahmood Qureshi accused the organisation of “political bias”. Pakistan’s frustration at being under international financial scrutiny, or the so-called “grey list” for nearly three years is evident. The international costs of Pakistan’s financial transactions have increased and the shadow over international economic support to the nation has darkened. That Pakistan’s compliance with 26 of the 27 actions specified by the FATF has not got it off the list has translated into political anger in the nation.

The fact, however, is that the outstanding issue is an important one and demands a fundamental change in Pakistan’s long-standing strategy of using international terrorism to pursue its foreign policy objectives, especially in relation to Afghanistan and India. The FATF has certainly praised Pakistan’s efforts to resolve issues around the 26 items on the agenda. The FATF, however, wants Pakistan to investigate, prosecute and convict senior leaders and commanders of the UN-designated terror organisations, including Afghan Taliban, Haqqani Network, Lashkar-e-Toiba, and Jaish-e-Mohammed. If the first two are focused on Afghanistan, the other two are directed at India. Support for these organisations has been at the heart of Pakistan’s foreign and security policies for decades. While Pakistan has convicted some identified leaders, the security establishment is not willing to take this fight to the logical conclusion. The FATF also wants Pakistan to tighten its regulations and close multiple loopholes on the money-laundering front.

It is by no means clear if the Pakistani state has the political will to clean up its act on terror-financing and money laundering. Pakistan is quite used to leveraging its geopolitical importance to get away with brazen transgression of international norms. After all, it has been on the frontlines of the unending global conflict around Afghanistan for the last four decades and more. This had given Pakistan the freedom to pursue a clandestine nuclear weapon programme and use terrorism to destabilise Afghanistan and Kashmir. Strong Chinese support and Western willingness to turn a blind eye tended to give Pakistan extraordinary impunity. While there has been no let-up in Chinese support, Pakistan’s salience to the West had begun to decline in recent years as the US began to lose interest in a prolonged war in Afghanistan and turn its attention to the larger challenge emanating from China. Once known for its geopolitical agility, Pakistan has been slow in adapting to the new international dynamic. Its state structures are deeply enmeshed with international terrorism and make it hard for Pakistan to make a clean break. While sensible voices in Pakistan are calling for a comprehensive overhaul in national interest, Delhi must expect that Islamabad will turn to blaming India and the world for the consequences of its poisonous policies over the last four decades.

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First published on: 28-06-2021 at 03:35:09 am
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