On 17 July, 2019, UN-designated terrorist, Hafiz Saeed, was arrested by the Counter-Terrorism Department of the (Pakistani) Punjab Police under the Anti-Terrorism Act, 1997, before he could get another interim bail. Charges against him include leadership of banned outfits like the Jamaat-ud-Dawa (JuD), the Lashkar-e-Taiba (LeT) and the Falah-e-Insaniyat Foundation.
Earlier this month, top 13 leaders of the banned JuD, including Saeed, were booked in nearly 24 cases for terror-financing and money laundering, but owing to an interim bail obtained from an anti-terrorism court in Lahore, Saeed could not be arrested.
It is pertinent to note that Hafiz Saeed is one of National Investigation Authority’s (NIA’s) ‘most wanted’ terrorists and is the co-founder of LeT – a terrorist organisation banned by India, the United States (US), United Kingdom (UK), Russia, Australia, the United Nations (UN) and the European Union (EU). It has been involved in a number of terrorist acts including the 2001 Indian Parliament Attack, the 2008 Mumbai Attacks, and the 2019 Pulwama Attack.
NIA’s summary of allegations against him reads “…acting in connivance with active militants of proscribed terrorist organisations Hizb-ul-Mujahideen (HM), Dukhtarane Millat, Lashkar-e-Toiba(LeT) and other terrorist organisations/associations/gangs for raising,receiving and collecting funds domestically and abroad through various illegal channels, including hawala, for funding separatist and terrorist activities in Jammu and Kashmir through the funds so collected and as such have entered into a larger criminal conspiracy for causing disruption in the Kashmir valley by way of pelting stones on the security forces, systematically burning of schools, damage to public property and waging war against India.”[i]
Connecting the Dots
This can be seen as yet another episode in the trend since 2001 where Hafiz Saeed has either been arrested or put under house arrest only to be freed later. Is this latest episode preparation for the bigger game in October 2019 when the Financial Action Task Force (FATF) finally decides the fate of Pakistan?
Timing of the Arrest
The action of Pakistan come as no surprise in light of the fact that the Pakistani Prime Minister, Imran Khan, is due for his maiden visit to the US on July 21, 2019. In addition to the arrest of Hafiz Saeed, Pakistan has also re-opened its airspace along its border with India which it has closed in response to the Balakot strikes. This had caused complications for, inter alia, American airlines.
Measures Taken by Pakistan – Too Cosmetic, Too Little, Too Late?
After Pakistan was grey-listed for “terror-financing deficiencies” last year, FATF had given Pakistan a 10-point plan with 27 indicators to strengthen its anti-money laundering and combating the financing of terrorism (AML/CFT) regime. The last set of the action plan items are set to expire in October this year. [ii]
Pakistan claims to have taken the following steps since being grey-listed – [iii]
- It has made national tax number mandatory for foreign currency transactions.
- It has stopped currency change up to $500 in the open currency market without a copy of any national identity card.
- It has banned 11 groups for links with JuD and Jaish-e-Mohammed (JeM).
While these steps, at first glance, may lead one to believe that Pakistan is taking some action, a critical examination reveals that no meaningful, systemic changes have been effected to take concrete and decisive actions to strengthen the AML/CFT regime. Pakistan has not addressed the issues of an inadequate legal framework, weak institutions, poor inter-agency coordination, deficient oversight, etc. There is no mechanism in place, for eg., to track the number of ‘donation boxes’ placed by various organisations, including ‘religious’ ones, at various places and verify where that money actually goes.
It is also noteworthy that Hafiz Saeed was banned by the UN in 2008. Pakistan has not been able to take concrete and decisive steps to punish and curtail the activities of this terrorist for more than 10 years now.
The World Doubts Pak’s Words
The cosmetic approach of Pakistan towards taking action against terrorism in general, and terror financing specifically, is reflective in the fact that out of the 27 indicators mentioned in the 10-Point Plan, Pakistan has been able to comply with only 18.[iv] Its performance was deemed ‘unsatisfactory’ during the meeting of the Asia-Pacific Group (APG) in Guangzhou, China, in May, 2019.[v] FATF President, Marshall Billingslea, mentioned that the blacklisting of Pakistan was “absolutely a possibility”.[vi] With regard to the action plan, FATF President also said that Pakistan’s actions were “lacking in almost every respect”.[vii]
Tellingly, the only countries/organisations which asked that Pakistan be given more time to comply with the action plan at the Orlando plenary of the FATF held in June this year were China, Turkey, Malaysia, Indonesia, Saudi Arabia, & the Gulf Cooperation Council.[viii]
Face of Panda, Traits of Dragon – The China Factor
China’s duplicity on the issue of terrorism continues with its support to Pakistan. There was much jubilation after it removed the technical hold which finally led to the listing of Masood Azhar as a “global terrorist” by the UN. It is pertinent to mention here that Masood Azhar heads the Jaish-e-Mohammed (JeM) – a group listed as a terrorist organisation by India, the US, the UK, Russia, Australia, Canada, the United Arab Emirates, and the UN. JeM has been responsible for a number of terrorist attacks in India including the 2001 Indian Parliament Attack, the attacks in Pathankot and Uri in 2016, the attacks on the Indian Missions in Afghanistan, and the 2019 Pulwama Attacks. According to NIA’s summary of allegations against him, Azhar “killed 08 and injured 38 innocent persons” in the Pathankot Attacks.[ix]
In the jubilation, the reason for China’s volte-face was not analysed. Given China’s investment in Pakistan as part of the Belt & Road Initiative, could it be seen as a move by China towards protecting its ‘iron friend’ in October from the FATF blacklisting? In this regard the words of Chinese Foreign Ministry spokesperson, Geng Shuang’s words are significant – “ I would like to stress that Pakistan has made enormous contributions to fighting terrorism, which deserves the full recognition of the international community…”[x]
It is almost certain that China will use the cosmetic examples of Masood Azhar and Hafiz Saeed to push the case for saving Pakistan from the FATF blacklisting. Since decisions are taken by consensus in the FATF plenary (China, Turkey and Malaysia are members of the plenary), it is anyone’s guess which way the decision will swing this October.
While blacklisting of Pakistan in October may or may not take place, even the grey-listing is hurting Pakistan economically. It is estimated that Pakistan could suffer a loss $10 billion annually if it remains in the grey-list.[xi]
To come out of the grey-list, Pakistan would require the support of at least 15 out of the total 36 voting members in the FATF.
While India should ensure black-listing of Pakistan through deft diplomacy and lobbying, is there a case for India to indulge in some quid pro quo as far as securing the release of Indian nationals, including Mr Kulbhushan Jadhav, languishing in Pakistani jails is concerned?
Given the pattern of arrest and subsequent release of terrorists, and a history of state patronage to terrorists (refuge to Osama bin Laden, terming Hizbul Mujahideen and LeT terrorists ‘freedom fighters’ and supporting them), this superficial act by Pakistan should be seen for what it is – just a charade. Pakistan’s efforts should be judged on the basis of the efforts to convict the terrorist and the evidence produced against Saeed in the court. India, meanwhile, should exploit Pakistan’s economic vulnerability through multi-lateral engagements.
[i] Nia.gov.in. (2017). Case Detail. [online] Available at: https://nia.gov.in/case-detail.htm?169 [Accessed 18 Jul. 2019]. [ii] Pakistantoday.com.pk. (2018). FATF gives Pakistan 10-point action plan to counter terror financing. [online] Available at: https://www.pakistantoday.com.pk/2018/06/30/fatf-gives-pakistan-10-point-action-plan-to-counter-terror-financing/ [Accessed 20 Jul. 2019]. [iii] Qarar, S. (2019). FATF compliance unit established in FIA. [online] DAWN.COM. Available at: https://www.dawn.com/news/1495003 [Accessed 20 Jul. 2019]. [iv] Ibid. [v] Ibid. [vi] Ikram, M. and Mohammad, N. (2019). Watchdog: Pakistan Could Still Be Placed on Blacklist. [online] Voice of America. Available at: https://www.voanews.com/extremism-watch/watchdog-pakistan-could-still-be-placed-blacklist [Accessed 20 Jul. 2019]. [vii] Pakistantoday.com.pk. (2019). Pakistan at FATF. [online] Available at: https://www.pakistantoday.com.pk/2019/06/26/pakistan-at-fatf/ [Accessed 20 Jul. 2019]. [viii] Haidar, S. (2019). India rejects Pakistan’s charge of politicising FATF. [online] The Hindu. Available at: https://www.thehindu.com/news/national/india-rejects-pakistans-charge-of-politicising-fatf/article28119036.ece [Accessed 21 Jul. 2019]. [ix] Nia.gov.in. (2016). Case Detail. [online] Available at: https://nia.gov.in/case-detail.htm?122 [Accessed 18 Jul. 2019]. [x] Gd.china-embassy.org. (2019). Foreign Ministry Spokesperson Geng Shuang's Remarks on the Approval of the Listing of Masood by the 1267 Committee of the UN Security Council. [online] Available at: http://gd.china-embassy.org/eng/fyrth/t1660201.htm [Accessed 21 Jul. 2019]. [xi] Tribuneindia News Service. (2019). FATF may blacklist Pak due to ‘lobbying by India’. [online] Available at: https://www.tribuneindia.com/news/nation/fatf-may-blacklist-pak-due-to-lobbying-by-india/752459.html [Accessed 21 Jul. 2019].