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Political Perception of FATF and Ramifications for Pakistan

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International politics in contemporary times is driven through geostrategic considerations. Significance of a country is not taken into account by its geo-economic paradigm rather in conflict of interest dilemma. This game of thrones deliberately is being played by great powers to influence the decision makings at abroad. Moving forward, Financial Action Task Force (FATF) is so called an independent body comprising of 39 member states plus regional organizations. In FATF, 37 are under jurisdiction member countries and 2 regional organizations (Gulf Cooperation and European Commission). It is a watch dog regulating the anti-money laundering and Terror financing framework. It functions by putting states in either black list or in grey list which are showing strategic deficiencies in recommendation given by the body. With these unregulated deficiencies Pakistan once again had been placed in grey list.  Apart from this it is controlled by power politics with and great powers.  Few examples of states like Yemen, Ethiopia, Sri-lanka, Serbia, etc, are in grey list with uncertainty of colliding interests. 

Shockingly, a statement released by Indian Ministry of External Affairs that “PM Modi will make sure that Pakistan would remains in Grey list of FATF by influencing the United Nation’s platform. Realistically, it is considered a tool through which domestic and international meddling of politics is being done. This argument undoubtedly substantiates the raised political tool against states like Pakistan suffering from miserable economy, foreign policy crisis and blank trade with states. Whereas, budget comparison and historical glimpses of terror acts such 9/11, have given rise to dilemma of terrorism and its menace at international level. Secondly, 26/11 of Mumbai attacks which undoubtedly changed the perception of South Asian politics.

Money laundering is an act of transforming the illegal money with certain unusual sources in purpose to decriminalize it. On the other hand, Terror financing is providing financial sources for terrorist activities. In terror financing funds could be legitimate origin such as profits or donations from business, or other organizations and illegitimate sources from drug trade, kidnapping or smuggling of certain goods Steps for both are commonly matched but the differences are of origination and objectives.

 Moreover, sources of ML and TF are concerned with tax evasion, with this factor at domestically or transnational, the owner conceals the sources of its earnings or its profits. Further, with authority fearing they may hide fiscal resources and transfer it to the other banks of neighboring states. Moreover, other substantial reason is negligible financial regulations of state. Additionally, ML can be attributed with involvement of airport security authorities, with these sources can be exchanged and converted to legitimate source without paying any single tax for it, this is called bribery. Further, political authorities are also genuinely involved with this. Moreover, there is no mechanized system to track the money source at international level. Last but not the least is money being carried out through porous borders, for instance Mexico and USA border and Pakistan Afghanistan border. Many other ways to deceive the anti-money laundering authorities ranging from division of money to bank control strategic failures. With all this the launderers can easily become investors. There are many international cases such as Case of Bank of New York to Vatican Bank case which are violating the laws. With unprecedented impacts of money laundering and terror finances harming the rationality of state, these are not only economic centric but creating the great influence and social ills. Firstly, it diminishes the image of that particular country, secondly, FDI get limitations by lowering the confidence of investors. Further, social ills are enhancing such as trafficking of drugs, population to piracy, and refugees’ influx which later will dependent on economy of that country.

Additionally, strangling ML and TF and substantial role carried out by FATF is considered as tool to make states relatively at harm. It is mainly dealing with anti-money laundering and combating financing the terrorism. This body comprising members ensures certain protocols for which states are abiding. Headquarter is at Organization for Economic Cooperation and Development in Paris. It dominates the six areas of interests in the form Recommendations, High-risk and non-cooperative jurisdiction, financing of proliferation, mutual evaluations, corruption and methods and trends. With this regard United Nations Security Council (UNSC) adopted the resolution 1617. Which is concerned with regularizes and adopts the 40 proposals on tax evasion and nine important suggestions on terrorist financing. Later on, the there were forty recommendations for expansion of financing of weapon of mass destruction. These ranging from identifying threats to undertaking new assignments concurred by its members.

Moreover, with the states like Pakistan, has been denoted as golden crescent. In Pakistan, the drug trafficking and money laundering are at immense pace. Problems relating the authorities to corruption have affected this state of affairs at large. For instance, Hawala and Hundi are the prominent source of money laundering in Pakistan. Writer has argued the terrorist activities of foreign state such India and Afghanistan are involved in terror activities to destabilize the Pakistan. With these impacts are of grave nature as earlier defined in review. In sort of many cases Pakistan has initiated and establishes many substantial efforts by amending the legal aspects and introducing many relevant acts in order to get out of grey list from which it had been added in 2015. Moreover, Pakistan has taken policy actions such as SAARC Regional Convention on Suppression of Terrorism to Signing Bilateral and multilateral agreements. Further, it has genuinely introduced many efforts in the form of National action plan and ban terror sponsoring bodies like JuD and FIF.  But demands are also increasing day by day. In new government in Pakistan a hope has been established but it will take inappropriate interests by leaving national policies at stake.

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South Asia

Politics of Pakistan: A Riot or an Opportunity

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On 14th August, 1947 Pakistan appeared on the world map as the largest independent Muslim state of that time. Sixty-five million people out of Ninety-five million population were Muslims. Despite of the shared religion of its majority, Pakistan is still struggling to build a national identity. Earlier, linguistic and cultural diversity were a hurdle but, in the Common Era political imbalance, rivalry and groupings left Pakistan with nothing but social, political and economic crisis with no future of stability.

Division of Sub-continent into India, West Pakistan and East Pakistan was a kick start to the largest demographic movement in history. Unfortunately, Muhammad Ali Jinnah died when Pakistan was less than a year old. The politics of Pakistan has not been less than a roller coaster ride. Till date the State has been ruled by 27 different Prime Ministers where some of them ruled twice and even thrice. Adding to that, the state has been under dictatorship four times since its independence. This political chaos has badly affected the economy of Pakistan. Not that Pakistan is a barren landlocked country with no reservoirs or no beneficial source to strengthen the economy, but, the political riot has played a vital role in paralyzing the social and economic bodies. Pakistan’s politicians have obediently followed the tradition of blame game since independence. Political representatives have always considered it necessary to blame the opponents for unstable environment in rather than being united against the state issues. The truth is that none of the political party could ever succeed in fulfilling the objectives of their five-year plan.

Due to sudden change of government, corruption, fragile institutions, the country’s economy suffered harsh weather. In 1980’s the economic growth was an impressive 6.3% which had a sharp decline during 1990’s and dropped to 4.9%. By the end of dictatorship the growth decelerated to 1.7% in 2008 and political instability accelerated to -2.4%. During the regime of PPP, the Nation succeeded in nothing but increase in economic instability, rise in corruption, inflation, and unemployment. PPP has set Karachi as a portrait of their inefficiency which the city witnesses every year during monsoon season. In 2013, the biggest political parties of Pakistan, PMLN and PTI fought the elections and undesirable results ended in a 126 days long dharna in the Capital of Pakistan with the inclusion of rallies, aggressive speeches and corruption cases against the opponents to hold them responsible and throw them out. The dramatic political unrest forced the country to lose hundreds of millions, foreign trust, foreign investment as well as paralyzing the Capital of the state. Nawaz Sharif was proven guilty and sent to jail, PMLN succeeded in making the institutions fool and Nawaz Sharif flew to the UK for medical treatment. In 2018, the ineligibility of Nawaz Sharif, Panama leaks and support of the number of people of the nation gave Imran Khan a chance to win the majority vote in National assembly. Forced to habit, the opposition instead of efficiently working with the government for the welfare of state, jointly formed PDM to demolish PTI’s government. Protests, long march, boycotts became the fate of Pakistan and which couldn’t affect the government much but, to lead to vote of no confidence in April, 2022 which resulted in Imran Khan’s removal. PTI blames PDM for joining hands with US in their regime change strategy. Even during PTI’s government, the instable economy was in the destiny of Pakistan. Currently, Shahbaz Sharif is the Prime Minister of the State and the economic conditions are nowhere near to a betterment; a total chaos.

The fake promises of every government has left the nation with nothing but empty bank accounts, economic collapse, inflation, extreme foreign debt, intolerance and extremism among its own people. The prime reason to every government’s failure is more or less their self- priorities. It was and is never about the betterment of state and its people but the authority, rivalry and seat. Every government without any discrimination focused on plans which would temporarily benefit the Nation during their tenure but, later due to huge foreign debt and IMF instructions, the country suffers inflation and hurdles in development of the country. Moreover, every new government finds the work of the former useless and terminate the projects, plans and policies initiated by them. This restricts the foreign investors from huge investments as more political instability leads to more economic deceleration.

Another huge drawback is that every government demands the state’s institutions to work their way, for example; the security departments’ ultimate duty is to protect the state from internal and external threats but what they do nowadays is to arrest the opponent leaders, raid their houses, protect red zone and blindly work under government’s thumb.

The biggest threat to Pakistan is its own poisonous politics. The political parties do not find their victory in providing the Nation with excellence and betterment but, the lust of power and hatred has forced the public to witness a psychotic political behavior. Election campaigns, days of protests in Islamabad, societal unrest and cyber-attacks have become a trend which has divided the Nation into groups.

Pakistan is on the verge of losing everything. IMF and other states have either denied or are delaying in providing aid to the country and the major reason is the political unrest but, a bitter reality is that politics cannot be ignored as it plays a prime role in connecting Pakistan on national and international levels. Political stability shall be the ultimate goal as it would help in formation of beneficial policies and would allow the institutions to work in a normal way which would only make Pakistan a healthy developed state. This 75th year and the years coming ahead can be good for Pakistan if elections are truly conducted on their time and the losing parties instead of creating a chaos, aids the ruling party in running the affairs of Pakistan smoothly.

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South Asia

Seventy-Five Years of India’s Independence

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If anyone had asked Jawaharlal Nehru as he made his midnight speech on August 15 and freedom dawned, how he visualized India 75 years hence, he would have described a Fabian paradise of equality and plenty.  Would he be disappointed?

The neo-liberal agenda, far removed from socialism, introduced by Manmohan Singh a few decades later was designed to invigorate the economy.  He lowered taxes, privatized state-run industries and encouraged foreign investment.  It did spark an economic boom but the withdrawal of the state from healthcare, education, banking and credit made it a country obsessed with profit.

If cities boomed, rural areas were left to stagnate.  GDP grew but the growth favored the upper 50 percent — the lower half did not enjoy a similar access to education or healthcare or have the same mobility.

According to the World Food Programme (WFP), a quarter of the world’s undernourished people now live in India and a fifth survive on less than $1.90 per day.  WFP has been working in India since 1963, and it reports that in the last two decades per capita income tripled yet the minimum dietary intake fell, and the gap between rich and poor actually increased despite this high economic growth.

Nehru’s ideal was a country of different faiths and different ethnicities, speaking many languages but living harmoniously and sharing a common Mother India.  Instead, unbalanced growth at the cost of the lower half of the population has led to scapegoating and the major target is the sizable Muslim minority.

The blame game now includes historical revisionism blaming Mughal emperors from India’s glory days when the exquisite Taj Mahal was constructed, the arts flourished and India generated almost a quarter of the World GDP.

This game also chides the Hindu Rajput princesses that Mughals married or the respected Hindu advisers that served the Emperors.  The much decried last great Mughal emperor in this blame game is Aurangzeb who extended the empire to almost India’s southern tip, ruling a vast area stretching into Afghanistan and its borderlands in Central Asia. 

The Aurangzeb narrative excludes a simple fact:  the majority of Aurangzeb’s advisers were Hindu.  A Hindu chronicler, Bhimsen Saxena, penned a memoir titled Tarikh-i-Dilkusha or a history that warms the heart, describes life as a soldier in service to the Emperor for more than a quarter century.  He may rail at Aurangzeb’s tactical or strategic errors but is forever loyal.  Hindu generals, nobles and advisers … they were not on the outside looking in, they were an integral part. 

For centuries, religion was not a divider.  Adherents of the two principal faiths worked together, lived together, married each other, and fought together including in 1857, during what the British called the Indian Mutiny and Indians refer to as the First War of Independence.

Thereafter, the British instituted systems and processes to develop rivalry and resentment, including quotas for intake into the prestigious Indian Civil Service as well as the lower level jobs.  The rivalry progressed into mistrust, then riots and killings, eventually into two countries fighting wars, and then to a nuclear stand-off and a divided Kashmir.

North versus South, East versus West, a continent is difficult to govern.  Have we heard this story before?

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South Asia

The two Punjabs

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Even in the midst of tensions between India and Pakistan, people to people linkages between both countries – with both Punjabs (Indian and Pakistani) as key stakeholders – have given reason for cautious optimism.

While cultural commonalities and the emotional attachment on both sides has been the driving force for Punjab-Punjab initiatives, the potential economic benefits of improved relations have been repeatedly reiterated not just by the business communities, but political leaders (especially from Indian Panjab)

In recent years, ties between both countries have steadily deteriorated. After the Pulwama terror attack in 2019, economic linkages between both countries have got severely impacted, and this has taken its toll on the economy of Panjab (India). India imposed tariffs on Pakistani imports, and revoked Most Favoured Nation MFN status to Pakistan in February 2019, while in August 2019, trade links via the Wagah (Pakistan) -Attari (India) land crossing were snapped after the revocation of Article 370 in Jammu and Kashmir. The suspension of trade ties between both countries has had a serious impact on the economy of the border belt of Punjab (India) with over 9,000 families being impacted as a result of job losses in the tertiary sector.

Developments of the past few months

The one glimmer of hope has been the Kartarpur Religious Corridor which was inaugurated in 2019 (in 2020 this was closed due to the covid 19 pandemic but re-opened in November 2021). The Corridor connects Dera Baba Nanak (Panjab, India) with Darbar Sahib (Kartarpur, Narowal, Pakistan) which is the final resting place of Guru Nanak (the founder of the Sikh faith). Devotees from Panjab (India) can pay obeisance at Darbar Sahib (Kartarpur) without a visa, though they do need to carry their passports. While the number of people crossing over, via the corridor, is way below the initial target of 5000, it has helped in promoting people to people ties as well as re-uniting a number of separated families. There has been a growing demand for easing out visa procedures for individuals over the age of 75 years and those from separated families (some of the individuals reunited at Kartarpur have been issued visas) which has been backed strongly by civil society organisations – as in the past.

 The phase from 2019-2022 has been witness to people to people linkages, especially with regard to religious tourism, but interactions between state governments of both the Punjabs, or what is referred to as ‘paradiplomacy’ unlike earlier years has been restricted. After the re-opening of the corridor in  November 2021, then Chief Minister of Panjab (India) Charanjit Singh Channi, and other political leaders from the state, paid obeisance at Darbar Sahib (Kartarpur), while also flagging the need for resumption of trade via the Wagah-Attari land crossing — though to no avail. 

There have however been calls for resumption of trade from sections of Punjab’s political class, business community as well as farmers from Indian Punjab. Pakistan which has been buying essential commodities including wheat at exorbitant prices could purchase the same from Panjab (India) and the Punjabi farmer could benefit by getting much higher prices for his produce.

Conclusion

In conclusion, even in the midst of strained ties between both countries, the Punjab has played an important role in trying to reduce tensions and build bridges between both countries, and the role of civil society, business community on both sides and the diaspora needs to be acknowledged. In the 75th year of independence while ties between New Delhi and Islamabad remain strained developments of the past few months, in the realm of people to people contact have given reason for hope as a result of the tireless efforts of civil society and some individuals committed to peace. The next stage of this should be easing out of visa regimes especially for certain categories of individuals – specifically those over the age of 75 who want to visit their ancestral homes. Resumption of trade via the Wagah-Attari land crossing will benefit not just Panjab (India) but other parts of North India and the Pakistani consumer. If both countries can focus on giving a greater fillip to people to people linkages and economic ties — with the Punjabs taking the lead – ties  between India and Pakistan could be less frosty.

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