Pakistan’s FATF grey-lit history has returned to attention following India’s election to the vice-presidency of the global financial-crime watchdog.
Read more about India’s first election to the FATF vice-presidency and why the appointment matters.
India’s new leadership position gives New Delhi greater visibility in discussions involving money laundering and terrorist financing. However, it does not give India the authority to place Pakistan—or any other country—under increased monitoring on its own.
Why Pakistan Was Placed on the FATF Grey List
Pakistan entered the Financial Action Task Force’s increased-monitoring process in June 2018 after the organization identified strategic weaknesses in its systems for combating money laundering and terrorist financing.
FATF concerns included the effectiveness of terrorist-financing investigations, prosecutions involving senior members of United Nations-designated terrorist groups and the implementation of targeted financial sanctions.
The monitoring process required Pakistan to demonstrate measurable enforcement rather than simply pass new laws.
A second action plan was introduced in June 2021, extending the country’s reform requirements to additional anti-money laundering areas.
How Pakistan Left the Grey List
By June 2022, the FATF determined that Pakistan had substantially completed two action plans covering 34 items.
The organization said Pakistan had demonstrated progress in terrorist-financing investigations and prosecutions and had increased money-laundering investigations in line with its risk profile.
Following an on-site assessment, the FATF removed Pakistan from its list of jurisdictions under increased monitoring on Friday, October 21, 2022.
Pakistan was nevertheless expected to continue working with the Asia/Pacific Group on Money Laundering to strengthen its financial-crime controls.
For more background, read our explanation of how the FATF grey list, black list and country-evaluation process work.
Can India Return Pakistan to the Grey List?
India’s FATF vice-presidency does not provide unilateral control over country assessments or public monitoring lists.
FATF decisions are based on technical reviews, evidence, peer evaluations and agreement among participating jurisdictions. A leadership role may help India raise concerns, contribute to policy discussions and support stronger global standards, but it cannot determine an outcome independently.
The issue remains politically sensitive following the April 22, 2025, Pahalgam terrorist attack, which renewed Indian calls for stronger international action against terrorism and its financing.
Any future scrutiny of Pakistan would still depend on whether FATF assessors identify new or unresolved strategic deficiencies.
India’s appointment therefore increases its influence within the discussion, but Pakistan’s status will ultimately depend on technical evidence, sustained compliance and collective decision-making.
