All Islamabad's diplomatic efforts ended without yielding any positive outcomes as 35-member Financial Action Task Force (FATF) has placed Pakistan in its grey list for allegedly financing terrorists but even stronger blow is that Pakistan's two ally China and Saudi Arabia remained silent on the motion. "The decision was taken [Thursday]".
Pakistan will be placed back onto an worldwide terrorism-financing watch list from June, according to a person with direct knowledge of the matter, a move that may hinder the country's access to financial markets.
The Wall Street Journal had named China, Turkey and Saudi Arabia as the "friends" who had come to rescue Pakistan, saying that the three countries had blocked the US's motion to put Pakistan on the list. If adopted the resolution would place Pakistan on the FATF grey-list of "jurisdictions with deficient anti-money laundering regimes".
Pakistan will be included in the list in June this year, sources told.
The decision is seen as being against the norms of the FATF and its sister organisations, as the country's Mutual Evaluation - a process of assessing levels of implementation of FATF recommendations, was now undergoing.
Pakistan Foreign Office Spokesperson Dr Muhammad Faisal, in a weekly press briefing in Islamabad today, said Pakistan had serious concerns over the motion moved by the U.S. and United Kingdom at the FATF, Radio Pakistan reported.
In a message posted on Twitter, Interior Minister Ahsan Iqbal said there is no official intimation of #FATF decision yet and "we should not speculate till official statement is released".
Paris-based FATF, also known by its French name Groupe d'action financiere, is an intergovernmental organisation founded in 1989 to develop policies to combat money laundering.
Specifically, on the FATF table, the proof is against JeM front Falah-i-Insaaniyat and LeT and its front Jamaat-ud-Dawa, which are evidently transacting financial business without much difficulty.More news: USA was told no Russians were involved in deadly Syria attack
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The US says Pakistan is not taking action against terror groups like the Haqqani network and the Taliban.
The spokesperson pointed out that the U.S. took several unilateral steps in recent months which have actually impacted the relationship. It is for the USA to rebuild the trust.
The Financial Action Task Force's decision to put Pakistan on a list of countries with lax controls over terror financing and money laundering is part of a push by the Trump administration to punish Islamabad over what it sees as inaction against terrorists operating on its soil.
The move comes days after reports that Pakistan had been given a three-month reprieve before being placed on the list. "No consensus for nominating Pakistan, proposing three months pause and asking APG [Asia Pacific Group] for another report to be concluded in June".
Ironically, it was the statement of Pakistani Foreign Minister Khwaja Asif, announcing that Pakistan had managed another reprieve from FATF, which provided the opening for a second bid by the USA to get Pakistan on to the watchlist. But the campaign proved insufficient and the group decided late on Thursday that Pakistan would be put back on the watchlist, according to the official sources.
Military successes against militants and massive Chinese infrastructure investments have restored some vim to an economy hobbled by a long-running religious insurgency and wrecked by the 2008/09 global financial crisis.
"But the odds of that, particularly in an election year, seem slim", he added. There was consensus among members on putting Pakistan in the grey list, ET has learnt.
If Pakistan fails to submit a plan, the FATF has the option of placing the country on its Black List, which carries adverse implications. "It will have a greater impact than it had last time", he continued, urging the government to take "appropriate measures" to combat the imminent danger of sanctions. It could also damage the prospect for foreign direct investment, just as Pakistan is seeking to remake its global image as a "normal" country and a destination for business.