The international terror financing watchdog FATF on Friday condemned the Pulwama terror attack that killed 40 CRPF Jawans and decided to keep Pakistan in 'grey list' for its failure to stop funding of terrorist groups such as Jaish-e-Mohammad, Lashkar-e-Taiba and Jamat-ud-Dawa. India has been pushing hard to 'blacklist' Pakistan over terror financing.

The Paris-headquartered Financial Action Task Force (FATF) issued a statement saying Pakistan should continue to work on implementing its action plan to address its strategic deficiencies, by adequately demonstrating a proper understanding of the terror financing risks posed by the terrorist groups.

President of the anti-terror financing group Marshall Billingslea told WION that they will hold Islamabad accountable if the country does not fulfil its commitments.

"The FATF notes with grave concern and condemns the violent attack in Pulwama," it said. "Pakistan has revised its TF (Terror Financing) risk assessment. However, it does not demonstrate a proper understanding of terror risks posed by Da'esh, Al-Qaida, JuD, LeT, JeM, Haqqani Network, and persons affiliated with the Taliban."

After being greylisted in June 2018, Pakistan had made a high-level political commitment to strengthen its AML/CFT regime.

FATF asked Pakistan to implement the 10 point action plan given by the country itself to address the "strategic deficiencies" on terror financing. It said in a release, "Given the limited progress on action plan items due in January 2019, the FATF urges Pakistan to swiftly complete its action plan, particularly those with timelines of May 2019."

The action plan calls for "demonstrating effective implementation of targeted financial sanctions against all 1,267 and 1,373 designated terrorists" by "preventing the raising and moving of funds, identifying and freezing assets, and prohibiting access to funds and financial services".

This is significant since the UNSC 1,267 designated terrorist include a number of Pakistan-based terror groups and terrorists such as 26/11 mastermind Hafiz Saeed, JuD and JeM.

Islamabad will also have to make sure its financial institutions are FATF complaint. Billingslea said, "We do expect those high-level commitments to be honoured. We expect the fundamental systematic deficiencies to be addressed."

FATF also condemned the Pulwama terror attack. The FATF president said, "We condemn the violent terrorist attacks that led to the loss of more than 40 Indian security forces in Pulwama, Jammu and Kashmir and we made additionally clear that the FATF will intensify its ongoing efforts."

The development comes as a shot in the arm for New Delhi which has been focusing on global isolation of Pakistan in the aftermath of the Pulwama attack that killed more than 40 CRPF personnel.

Troublesome Neighbour

  • FATF feels Pakistan has not done enough and does not have 'proper understanding' of the terror financing risks posed by Da'esh, AQ, JuD, FiF, LeT, JeM, HQN, and Taliban
  • Action plan calls for Pakistan to swiftly take action against all 1,267 and 1,373 designated terrorists
  • Pakistan has time till May 2019 to either comply with FATF's demands or get ready to be blacklisted

Global Pressure On Pak Mounts

  • India pushed for Financial Action Task Force (FAFT) to move Pak from its ‘grey list’ to ‘black list’, but it was decided during a plenary session in Paris to not move the nation
  • Pak was greylisted by the global terror financing watchdog in June 2018, after pressure from India, US, UK, France & Germany 
  • It was handed a 27-point action plan to implement by September 2019 
  • This included demonstrating understanding of the risks posed by terror groups such as Da’esh, Al-Qaeda, Lashkar-e-Toiba, Jaish-e-Mohammed and persons affiliated with the Taliban
  • Its position will now be reassessed on June 2019. If it fails, it will find itself on the black list, alongside North Korea and Iran
  • Pakistan was reportedly on the black list between 2012 and 2015