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China’s FATF Shield for Pakistan

July 6, 2020 By Lt. General P.C. Katoch (Retd) Photo(s): By FATF
The Author is Former Director General of Information Systems and A Special Forces Veteran, Indian Army


FATF (File photo)

On June 24, the Financial Action Task Force (FATF), the global terror financing watchdog, decided to keep Pakistan in the "Grey List" as it had failed to check flow of money to terror groups like the Lashkar-e-Taiba (LeT) and the Jaish-e-Mohammad (JeM). The decision was taken at the FATF’s third and final plenary held virtually due to the COVID-19 pandemic. A strong Indian delegation with experts on money laundering and terror financing participated in the half-day FATF plenary. India has been maintaining that Pakistan extends regular support to terror groups like LeT, JeM and Hizbul Mujahideen, whose prime target is India, and has been urging FATF to take action against Islamabad.

Pakistan was placed on the 'Grey List' by the FATF in June 2018 and continues to be in the list since then as it has failed to comply with the tasks given by the FATF to stop terror financing. The FATF is an inter-governmental body established in 1989 to combat money laundering, terrorist financing and other related threats to the integrity of the international financial system. The FATF currently has 39 members including two regional organisations -- the European Commission and Gulf Cooperation Council. India is a member of the FATF consultations and its Asia Pacific Group. Having repeatedly failed to meet the FATF requirements, Pakistan should have been placed on the ‘Black List’ by FATF but that is not going to happen with China chairing the FATF and Pakistan sitting in Beijing’s lap.

The FATF plenary was held under the Presidency of China’s Xiangmin Liu. The usual noises were heard after the FATF dictum, like: one, with Pakistan's continuation in the 'Grey List', it will be difficult for the country to get financial aid from the IMF, World Bank, ADB and the European Union, thus further enhancing problems for the nation which is in a precarious financial situation, and; two, if Pakistan fails to comply with the FATF directive by October, there is every possibility that the global body may put the country in the 'Black List' along with North Korea and Iran. But nothing of this sort will happen. It can be assumed for certain that as long as China continues to preside over the FATF, Pakistan will continue to let terrorist organisations be funded, not meet FATF requirements and will still not be placed on the ‘Black List’ of the FATF. That is why Pakistani Prime Minister Imran Khan brazenly called Osama bin-Laden, who was known as the ultimate terrorist, a martyr in Parliament, "I will never forget how we Pakistanis were embarrassed when the Americans came into Abbottabad and killed Osama Bin Laden, martyred him," he said. As for Pakistan’s economic situation, it is bad and it is asking Beijing for softer repayments for the China-Pakistan Economic Corridor (CPEC). But we must acknowledge that Pakistan is a vassal state of China and the latter will never let it sink.

Significantly, the FATF decision came a day after the US Country Report on Terrorism slammed Pakistan as a safe harbour for "regionally focused terrorist groups" and allowing LeT and JeM to operate from its soil. The US State Department report said Pakistan took modest steps in 2019 to counter terror financing and restrain India-focused militant groups from conducting large-scale attacks following the February attack on a security convoy in Pulwama in Jammu and Kashmir linked to Pakistan-based Jaish-e-Mohammed (JeM). The report reads, "Pakistan took action against some externally focused groups, including indicting Lashkar e-Taiba (LeT) founder Hafiz Saeed and associates in three separate terrorism financing cases. However, Pakistan remained a safe harbour for other regionally focused terrorist groups. It allowed groups targeting Afghanistan, including the Afghan Taliban and affiliated HQN, as well as groups targeting India, including LeT and its affiliated front organisations, and Jaish-e-Mohammed (JeM), to operate from its territory.” Pakistan rejected the US report calling it “disappointing”.

Now a German government report on nuclear non-proliferation has put Pakistan in the dock for its dismal record in nuclear proliferation. The annual report of the Office for the Protection of the Constitution of the German State of Baden-Württemberg for the year 2019 released on June 16, 2020 explains the term “proliferaton” of nuclear, biological and chemical weapons of mass destruction – or the products or know-how necessary to produce them – and related delivery systems. The report says Pakistan, North Korea and Syria are still pursuing such efforts. They aim to complete existing arsenals, perfect the range, deployability and effectiveness of their weapons and develop new weapon systems. They are trying to obtain the necessary products and related know-how, through illegal procurement efforts in Germany. The report goes on to say, “Pakistan’s extensive nuclear program is directed against arch enemy India who also possesses nuclear weapons.” Warning Germany of countries like Pakistan using important institutions and high-tech companies in Germany to procure material, the report added, “In order to minimise risk, the State Office of Protection of the Constitution sensitises those responsible to make them aware of the danger and possible consequences of illegal knowledge transfer.

For maintenance and further development, Pakistan is dependent among other things on acquisition of Western technology and procedures in addition to acquisition of products (dual-use goods) the secondment of scientists to universities, institutes or research establishments is to universities or research institutes is also important. This also applies to institutions in Baden-Württemberg.” But China itself having committed biological terrorism against the world protects Pakistan. The joke going around with the report of 262 commercial pilots of Pakistan of the total 860 having fake flying licenses is that Pakistan could be running mass training for future 9/11 type terrorist attacks.