In a significant achievement, India has been placed in the top category of countries with robust safeguards against money laundering and terrorism financing, as per the recent review by the Financial Action Task Force (FATF). This milestone is a testament to the country’s commitment to national security and its efforts to strengthen the integrity of its financial system.
The achievement is a result of a team effort, involving a whole-of-government approach that brought together multiple stakeholders, including the National Security Council Secretariat (NSCS) under the National Security Adviser (NSA) Ajit Doval.
This top category rating will accrue several benefits to the economy, including increased investor confidence in India’s overall stability and integrity of its financial system. It demonstrates India’s commitment to international standards and its proactive stance in the global fight against financial crimes.
The recognition by FATF is a testament to India’s efforts to combat money laundering and terrorism financing, and its dedication to ensuring a secure and transparent financial environment for all.
India has been placed in the ‘regular follow-up’ category, a distinction shared by only four other G20 countries.
The FATF recognition acknowledges India’s efforts in mitigating risks arising from money laundering and terrorist financing, transitioning to a digital economy, and implementing effective measures to reduce ML/TF risks. The implementation of the JAM Trinity and stringent regulations on cash transactions has led to increased financial inclusion and digital transactions, making transactions more traceable and mitigating ML/TF risks.
This achievement accrues significant advantages to India’s growing economy, demonstrating the stability and integrity of the financial system. It will lead to better access to global financial markets and institutions, increase investor confidence, and facilitate the global expansion of the Unified Payments Interface (UPI).
India’s commitment to international standards and its proactive stance in the global fight against financial crimes have been underscored by this recognition. The country’s excellent rating will enhance its capacity to lead the global effort on countering cross-border terror financing and money laundering.
The Government of India has enacted legislative changes and bolstered enforcement efforts since 2014, bringing measures in line with international standards. Indian authorities have successfully dismantled terror funding networks, stemming the flow of terror funding, black money, and narcotics.
The Department of Revenue spearheaded India’s engagement with FATF during the mutual evaluation process, with a diverse, multi-disciplinary team contributing to this success. India remains committed to strengthening its AML/CFT framework and collaborating with international partners to combat financial crimes.
This achievement demonstrates India’s effective AML/CFT framework and paves the way for the country to contribute significantly to the FATF Steering Group. India will continue to build on this success to ensure a secure and transparent financial environment for all.
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