FATF brings in state funding of terror concept; boost for India’s anti-Pak fight

The Financial Action Task Force (FATF) has for the first time introduced the concept of state sponsorship of terrorism, in what is a boost for India’s case against Pakistan’s proxy wars.

A latest report, “Comprehensive Update on Terrorist Financing Risks", released by FATF on Tuesday states that a variety of publicly available sources of information and delegations’ inputs indicate that certain terrorist organisations have been and continue to receive financial and other forms of support from several national governments.

While FATF has not developed a typology specific to state-sponsored terrorism, it has explicitly noted that the funding of terrorism, or the resourcing of a terrorist entity, by any state violates the task force’s norms.

“The possibility that states may provide financial or other forms of support to organisations engaging in terrorist acts is a longstanding threat to international peace and security. It undermines the effectiveness of FATF activities that were intended to support governments in adopting best practices to detect, deter and disrupt terror financing," the FATF report states in an acknowledgment of India’s stand on state sponsorship of terror by Pakistan in the wake of April 22 Pahalgam terror attack.

⁠Before FATF’s latest report, India had identified state-sponsored terrorism from Pakistan as a source of terrorist-financing risk in its risk assessment report for 2022. “So, FATF’s introduction of state sponsorship of terrorism reinforces India’s position," government sources today said, flagging the report that further highlights the funding patterns of Pakistan-based LeT and JeM.

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