Pakistan has been given a three-month reprieve by the Financial Action Task Force, a global watchdog, over a US-led motion to put the country on a terrorist financing watchlist, Pakistan's foreign minister Khawaja Asif said late on Tuesday.
Pakistan has been scrambling in recent months to avoid being added to a list of countries deemed non-compliant with anti-money laundering and terrorist financing regulations by FATF, a measure that officials fear could hurt its economy.
But although it is a temporary reprieve to give Pakistan a chance to clean up its act, that country played it like a triumph, saying the move to put it on the watchlist had been thwarted.
''Our efforts paid, FATF Paris 20 Feb meeting conclusion on US led motion to put Pakistan on watch list - No consensus for nominating Pakistan," Pakistan's foreign minister Khwaja Asif tweeted on Tuesday evening, based on which Pakistani media reported that the US bid to put Pakistan on terror financing watch-list "falls through".
But in the very next line, Asif revealed that the meeting was "proposing 3 months pause and asking APG for another report to be considered in June," indicating that the reprieve was temporary and subject to Islamabad fulfilling its obligation to crack down on terror financing. APG is the Asia / Pacific Group on Money Laundering (APG) in the Financial Action Task Force (FATF), which took up the matter of Pakistan's patronage of terrorism this week.
FATF member states have been meeting this week in Paris, where it was expected that they would decide on a US motion, backed by Britain, France and Germany, to have Pakistan added to the so-called ''grey list'' of countries which are not doing enough to comply with terrorist-funding regulations.
In Washington, a state department official contacted by Reuters would not confirm that FATF deferred action for three months, pointing out that the organisation's deliberations are confidential until it makes them public.
The international community continues to have concerns about deficiencies in Pakistan's anti-money laundering and counter-terrorism financing system even though Islamabad has begun taking steps to address the flaws, said the State Department official without elaborating.
Pakistan earlier this year submitted a report about the progress it had made in curbing terrorist financing, but Washington submitted its motion before the Pakistan report could be discussed at the Paris hearing.
''Grateful to friends who helped,'' Asif added. Two other Pakistani officials confirmed Pakistan had received a reprieve of three months. Washington has been threatening to get tough with Islamabad over its alleged ties with Islamist militants, and last month President Donald Trump's administration suspended aid worth about $2 billion.
Pakistani commentators claimed that support from the Gulf nations and Pakistan's recent supply of troops to Saudi Arabia for its war on Yemen swung the issue in its favor.
"Good News! Apparently FATF failed to achieve consensus against Pakistan & matter is delayed for a while. GCC switched sides & supported Pakistan. Gen Bajwa's last minute "troop diplomacy" to Saudi Arabia delivered. But Indians will come back soon!" tweeted Moeed Pirzada, a TV talking head, with the familiar allusion to New Delhi's hand in Pakistan's reputation as a terrorism sanctuary.
Islamabad, which denies assisting militants in Afghanistan and India, has reacted angrily to US threats of further punitive measures. Pakistan's government is concerned the FATF decision could hurt its banking sector and the economy just as a national election looms.