Pakistan’s hopes of exiting the FATF grey list have been shattered once again. The global money laundering and terror financing watchdog decided to keep the country under enhanced monitoring for another four months. However, analysts are divided on the global watchdog’s decision to retain Pakistan on its so-called ‘grey list’.
Some observers believe that the international community is deliberately targeting Muslim countries, which is not far-fetched. But it is difficult to find evidence of a geopolitical game in this regard, and if one looks at the technicalities of the FATF, the watchdog is indirectly linked to the United Nations.
It is also clear that decisions in the Security Council, the IMF and the World Bank are often dominated by international politics. There is lobbying all over the world and if we talk about IMF, then the stalemate in Pakistan’s talks with the International Monetary Fund has ended.
It has come to light that Pakistan has to abide by every condition of the IMF, as a result of which a sharp rise in inflation is a must. This includes a further increase in electricity and gas prices and an increase in the burden of miscellaneous taxes in accordance with IMF conditions.
Similarly, if one looks at the last meeting of the FATF, the political element is found in it with evidence. Because Indian Foreign Minister J Shankar had admitted in public that thanks to our efforts, Pakistan has been kept on the grey list. According to observers, it is not possible to ignore the legitimacy of sanctions imposed by an institution such as the FATF to put pressure on Muslim countries.
However, first, we have to see if we have met the FATF requirements. The FATF recognises that Pakistan has addressed or largely addressed 30 out of the 34 items contained in the two FATF/APG action plans of 2018 and 2021 but urges the country to show evidence that it is actively making efforts for adding persons and organisations linked to terrorism to the UN sanctions list.
Pakistan is also required to demonstrate an increase in money-laundering investigations and prosecutions, and to continue to restrain and confiscate the proceeds of crime and to work with foreign counterparts to trace, freeze and confiscate assets.
As far as the politics of keeping Pakistan on the gray list is concerned, Pakistan is a very important country in the region at the moment and in the current situation where both the United States and China are facing each other, it is a reality to target China’s allies. In Pakistan’s troubled economic situation, where inflation and dollar are skyrocketing and the mountain of debt is rising, the FATF’s decision to retain Pakistan on grey list will further affect the economy. Investment in Pakistan, which is already very low, will continue to decline.
The international political scene in the region suggests that countries like Pakistan are automatically targeted in the tussle of major powers like the US and China. That is why, despite the best measures and performance, the FATF continues to push Pakistan into the gray list for political reasons, justifying technical reasons.
This is clearly reflected in the recent Pakistan-IMF meeting in which the global lender is giving strictest conditions for Islamabad, which has led to economic chaos in Pakistan as well as political and social chaos, the result of which will be difficult for the rulers in the coming days.
