Pakistan Loses Major US Financing After Being Labeled ‘Terrorist Friendly’


Pakistan’s struggling economy, one of the weakest in South Asia, received another perilous blow yesterday when the Financial Action Task Force decided to include the country on its list of nations with lax power over money laundering and terrorist financing.


Saudi Arabia had initially opposed the listing, but backed down after pressure was exerted by the United States. This is seen as a further attempt by the Trump administration to punish South Asian countries over what it perceives as criminal laxity in dealing with terrorist organizations operating on its soil. Previously, the Trump administration had announced it would be denying a two billion dollar anti-terror loan to the country, after voicing grave doubts about the integrity of the country’s banking industry.


The Task Force, which has been labeled ‘secretive’ by several European countries, is also keeping Iran on the Terror List even though Tehran had pushed several European countries, such as England and France, to be removed. Abbas Araqchi, the Deputy Foreign Minister of Iran, has threatened to discard the 2015 nuclear arms accord if major international banks were still banned from doing business in Iran. Any country placed on the terror-finance list by the Task Force is automatically shut out from dealing with almost every major international bank.   


The Task Force’s action in Pakistan will mean less fluidity in the country’s stocks and bonds market, as well as higher prices on imports such as fuel oil and foodstuffs. The government insists that it has done everything in its power to eradicate terrorist strongholds within its own borders and that there are now no terrorist financial networks operating inside the country.