India has garnered positive feedback from the Financial Action Task Force (FATF), a global watchdog combating money laundering and terrorist financing. In its latest evaluation, FATF acknowledged India's robust compliance with international standards but highlighted areas needing improvement, particularly in non-financial sectors.

The FATF's mutual evaluation report, adopted recently, applauds India for its technical compliance in combating financial crimes. The country has demonstrated proficiency in identifying money laundering and terrorism financing risks, fostering international cooperation, seizing criminal assets, and implementing counter-proliferation financing measures.

However, concerns remain regarding India's approach to counter-terrorism financing in non-profit sectors. FATF emphasizes the necessity for a risk-based strategy in this regard. A visit by FATF representatives in November addressed these concerns with various non-profit organizations, with a detailed report forthcoming after review.

Membership in FATF bolsters India's standing alongside major economies, enabling enhanced global financial market access. The recent plenary in Singapore recognized India's strides, placing it in the 'regular follow-up' category, shared by only a few G20 nations, underscoring its commitment to combating financial crimes.

India's efforts, including transitioning to digital transactions through initiatives like the JAM Trinity (Jan Dhan, Aadhaar, Mobile), have bolstered financial inclusion and traceability, reducing money laundering and terrorism financing risks. These measures align with international norms, boosting investor confidence and supporting initiatives like the Unified Payments Interface (UPI).

Since 2014, legislative reforms and stringent enforcement have aligned India with global standards, yielding successes in dismantling terror funding networks and curbing illicit financial flows. The collaborative effort across ministries, regulators, and businesses underscores India's comprehensive AML/CFT framework.

Looking ahead, India aims to strengthen its AML/CFT measures further, collaborating internationally to maintain financial integrity and transparency.

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