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Will Pakistan be blacklisted by FATF?

Currently, Pakistan is present on the grey list of Financial Action Task Force (FATF), but some experts have warned that the threat of being blacklisted is still looming. Before we explain what grey and blacklists are and what are the effects of being blacklisted, let’s have a look at FATF.
What Is FATF?
The Financial Action Task Force (FATF) is an inter-governmental body established in 1989 by the G-7 Summit that was held in Paris. The objectives of FATF are to combat money laundering, terrorist financing and other related threats to the integrity of the international financial system. G-7 or Group 7 includes America, Canada, France, Germany, Italy, Japan, UK, and other European countries. The task force was given the responsibility of examining money laundering techniques and trends, reviewing the action which had already been taken at a national or international level and setting out the measures that still needed to be taken to combat money laundering.
Why is Pakistan on FATF Grey List?
In June 2018, the Financial Action Task Force included Pakistan on the grey list on the accusations of having failed to eradicate money laundering as a result of which terrorists can raise funds for their activities. Pakistan was given an action plan through which they can be excluded from the grey list. However, the task force was not impressed by the actions taken by the Pakistani government. As a result, Pakistan is still on the grey list.
Is India trying to push Pakistan on the Blacklist?
Foreign Minister of Pakistan, Shah Mehmood Qureshi in an interview in October 2019 has said that India is trying to push Pakistan on the blacklist of FATF. FM Qureshi said that India has been opposing Pakistan in FATF and there is no secret about its intention. Prime Minister Imran Khan has also criticised India for pushing Pakistan towards being blacklisted by FATF. He said that India was creating negative propaganda against Pakistan.
Can Pakistan be Blacklisted?
The Pakistan Tehreek-e-Insaaf government continues to defend its effort for combating terror activities and their financial networks in order to prevent money laundering, but Pakistan has yet to complete 18 out of 27 actions agreed in the FATF action plan. Therefore Pakistan can, in fact, be blacklisted.
How much time remains for Pakistan?
According to FATF officials, Pakistan hasn’t completed its assigned tasks, and that is why Pakistan will not be excluded from the grey list any time soon. Pakistan has to complete its tasks before February 2020 otherwise it will be included in the blacklist of FATF and can face major consequences.
What are the Consequences of being blacklisted?
If Pakistan is blacklisted by FATF, strong action will be started against our nation. Pakistan will face an overall downgrade of the financial system and restrictions on its markets. Pakistan’s financial system will be declared as less transparent through which international banks will face difficulties to operate in the country. Another grave consequence would be an increase in the country’s risk premium, as interest rates on international loans taken by Pakistan will see an upward revision.  The move will also affect Pakistan’s economy plunging exports and raising trade deficit.
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