India’s FATF Vice Presidency Bolsters Push to Re-Grey List Pakistan

India has secured a key position in the global fight against financial crimes, with senior IAS officer Vivek Aggarwal appointed Vice President of the Financial Action Task Force (FATF) this month. Aggarwal, a former director of the Financial Intelligence Unit, will serve a term in the 40-member intergovernmental body that sets standards for combating money laundering and terrorist financing.

The appointment comes as India prepares to petition FATF to re-list Pakistan on its grey list—a financial alert that impacts trade, investment, and banking. Pakistan was previously placed on the grey list from February 2012 to February 2015, and again from June 2018 to October 2022. During these periods, the country faced increased scrutiny and was compelled to demonstrate compliance with anti-money laundering and counter-terrorism financing norms.

India has consistently argued that Pakistan has not taken adequate action against terrorist groups operating from its soil, including those implicated in attacks on India. The grey listing serves as a diplomatic and financial pressure tool, potentially impacting Pakistan's access to international financial institutions and markets.

Vivek Aggarwal’s elevation to the FATF vice presidency is seen as a strategic move, giving India a stronger voice in shaping the task force’s agenda and priorities. Analysts note that his experience at the Financial Intelligence Unit—an agency that tracks suspicious transactions—will be invaluable in advancing India’s positions.

The FATF, headquartered in Paris, currently has 39 member jurisdictions and two regional organisations. Its decisions can influence global financial flows and national security policies. India has been a member since 2010 and has actively used the forum to highlight cross-border terrorism financing.

Pakistan’s removal from the grey list in October 2022 followed a series of reforms, but India and other nations have expressed concerns over incomplete implementation of action plans. The new petition is expected to focus on Pakistan’s alleged failure to prosecute designated terrorist entities and curb fundraising activities.

Observers say India’s increased influence within FATF could accelerate the review process. However, final decisions require consensus among members, and Pakistan has allies—notably China and Turkey—who may resist re-listing. The outcome will depend on technical assessments and political negotiations.

Vivek Aggarwal’s appointment is part of a broader Indian strategy to strengthen its role in global governance institutions. The government has also pushed for reforms in the United Nations and other multilateral bodies, seeking greater representation for developing countries.