Pak. to face monitoring by international review group

Pak. to face monitoring by international review group

Context:

• Pakistan  has been put back on the “Grey List” for terror financing by the Financial Action Task Force (FATF) Plenary.

What is more in news?

• The country will, under a “Compliance Document,” now be required to furnish a fresh report to the International Co-operation Review Group (ICRG).
• Accordingly, the country will undergo a review at the next Plenary in June, 2018.
• It would be presented a full action plan on how it is expected to crack down on terror groups banned by the UN Security Council.
• The move was pushed by four nominating countries, the U.S., the U.K., Germany and France.

Background:

• In mid-January, the four countries have written to the FATF stating that even though Pakistan had an anti-money laundering/anti-terror funding regime in place, effectiveness of the implementation was inadequate.
• Meanwhile a rally by LeT chief Hafiz Saeed, and the Khyber Pukhtunkhwa state’s decision to raise funding for Haqqani group-linked seminaries over the week didn’t help Pakistan’s case.
• Earlier this week, Pakistan had claimed victory in the ongoing FATF meeting, as a preliminary discussion in the ICRG failed to build a consensus on putting it again on the watch list, after China, Turkey, Saudi Arabia and GCC countries objected to Pakistan’s nomination.
• At the end of the recent Plenary session there were no objections to the nomination of Pakistan.
• A move that could see it face financial strictures, and ratings downgrades by international banking and credit rating agencies until Islamabad carries out a full crackdown on terror groups.

Behind the scenes:

• The U.S. worked hard to bring Saudi Arabia around.
• Germany worked on the GCC.
• India was able to speak to Russia.
• According to the sources, China may have been incentivised to help because it had become Vice-Chair of the FATF committee.