FATF Flags Pakistan’s Missile Tech Import Attempt Via China, Strengthening India’s Case For Islamabad's 'Grey List' Re-Entry: Report

A new report by the global anti-terror financing watchdog Financial Action Task Force (FATF) has spotlighted Pakistan’s covert efforts to procure missile-related technology through deceptive shipping practices, raising serious questions about its compliance with global norms on non-proliferation financing.

The findings, part of FATF’s latest assessment titled ‘Complex Proliferation Financing and Sanctions Evasion Schemes’, directly link Islamabad’s National Development Complex (NDC) responsible for missile production with a mislabelled consignment from China.

The report highlights an incident from February 2020, when Indian authorities intercepted a Chinese vessel, Da Cui Yun, at Gujarat’s Kandla Port.

The ship, bound for Port Qasim in Karachi, was found to be carrying sensitive dual-use items falsely declared as autoclaves.

“Indian authorities confirmed that documents mis-declared the shipment’s dual-use items,” the FATF noted, adding that these components are on the Missile Technology Control Regime’s export control list.

According to FATF, Indian Customs investigations established a clear paper trail connecting the shipment to Pakistan’s NDC.

The items, typically used for sensitive high energy materials and for insulation and chemical coating of missile motors, were seized.

Though the vessel and its crew were later allowed to depart, the incident has found renewed relevance amid current FATF scrutiny.

According to a TOI report, these revelations could strengthen India’s case for Pakistan to be re-listed on FATF’s ‘grey list’, a category for countries with strategic deficiencies in anti-money laundering and counter-terror financing regimes.

Pakistan, which has appeared on the list three times, was last removed in 2022 after sustained international pressure.

New Delhi is expected to cite this episode in an upcoming FATF dossier to argue for Pakistan’s return to enhanced monitoring.

Such a move could result in tougher financial oversight, reduced investor confidence, and constrained capital flows into Pakistan’s already fragile economy.

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