The Pulse | Politics | South Asia

What Does the Controversial Anti-Money Laundering Bill Tell Us About Pakistani Politics?

Pakistan’s parliament rejected a major Anti-Money Laundering Bill, claiming the government had left out the opposition’s amendments.

Umair Jamal
What Does the Controversial Anti-Money Laundering Bill Tell Us About Pakistani Politics?
Credit: Pixabay

On August 26, Pakistan’s parliament rejected a major Anti-Money Laundering Bill linked to the Financial Action Task Force (FATF)’s requirements for the country. 

Opposition parties blame the Pakistan Tehreek-e-Insaf (PTI) government’s plans to victimize its political opponents by legislating what critics term a “black law.” The opposition has also requested the military intervene as the legislation deals with an issue of national security.

The government, on the other hand, has labeled the position of opposition parties an attempt to gain the PTI’s support for money laundering. Recently, tensions between the government and the opposition have grown over allegations that top opposition leaders are seeking a National Reconciliation Ordinance (NRO) — like the one President Pervez Musharraf enacted in 2007 — which would effectively wipe out all pending corruption cases. The PTI’s promises to combat corruption has resulted in a raft of charges targeting opposition figures, angering political opponents.

Amid these tensions, Pakistan’s government may end up missing significant legislation to meet the FATF’s demands while upsetting the military further. 

The ongoing debate on the controversial legislation shows that opposition parties are seeking the military’s involvement in the process. The secretary-general of the Pakistani Muslim League – Nawaz (PML-N), Ahsan Iqbal, said that with such provocative attempts the government is dragging “national institutions” into politics. He further added, “The government is giving an impression that our national institutions are partners with it in its victimization policy, which is not good for national security and I severely condemn it.”

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Opposition parties appear to be willing to support any law that deals with the FATF recommendations as it directly involves the military’s interest. In the past, opposition parties have supported the government in FATF-related laws. However, apparently the opposition does not want the government to solely take credit for the legislation and at the same time sideline them further. According to the opposition, the government had agreed to include their amendments to the Anti-Money Laundering Bill. However, at the time of the voting, the government presented a bill that did not carry those amendments, thus their voting it down.

In the past, the government has responded with a heavy-handed approach whenever the opposition attempted to criticize its governance failures and its alleged support within the national security institutions. If passed into law in its current form, the Anti-Money Laundering Bill will give the government more power to round up any politician that it considers a challenge to its rule.

It is likely that beyond generating consensus over legislative issues dealing with the FATF, the military’s leadership is not aware of what the draft means in its entirety. This possibility offers the government a chance to bring in clauses that it finds useful for its own political needs.

However, the situation is likely to backfire for the government. The case of General Qamar Javed Bajwa’s extension offers insights into the current government’s poor handling of important legislative processes. Last year, the PTI government offered Bajwa an additional three years in office, citing national security reasons. However, the party’s lawmakers didn’t follow the necessary legal and legislative procedures. The issue drew serious criticism from the judiciary and political parties and perhaps damaged Bajwa’s standing within those institutions. The development is said to have also strained Bajwa’s ties with the government.

With the current legislation, the government is under pressure from the military to complete all parliamentary processes involving the FATF’s requirements before the forum’s next hearing. According to the decisions made in the previous meetup of the FATF, Pakistan was asked to close major loopholes involving money laundering and anti-terror laws by June 2020. The forum couldn’t meet due to the COVID-19 crisis, giving Pakistan more time to implement the necessary reforms. However, with the opposition challenging the latest legislation, the government has become mired in another controversy. The situation is sure to annoy the military’s leadership. 

This is not the first time that the current government has created troubles for the military in the foreign policy space. Recently, Pakistani Commerce Minister Abdul Razak Dawood proposed suspending some projects under the China-Pakistan Economic Corridor (CPEC). Following Dawood’s comments, Bajwa visited China and assured Beijing of Pakistan’s commitment to the project. “China-Pakistan military ties are an important backbone of relations between the two countries,” said General Zhang Youxia, a deputy chairman of China’s powerful Central Military Commission, after meeting Bajwa. 

The opposition may see the new controversy as another opening to create space between the military and the PTI government. Undoubtedly, the legislation carries some vague provisions that could be employed against the government’s political foes. However, the scope of the legislation is far bigger than the trivial issues of settling scores in domestic politics — money laundering is a serious issue.

Opposition parties understand that the military is aware of the need for cooperation in Parliament when it comes to issues of national security. Thus, with the current situation, the opposition has a chance to get closer to the national security establishment in seeking to include their amendments to the law, and blaming the government for not doing so.