The United States and its European allies have tabled a motion with the Financial Action Task Force (FATF) with a view to placing Pakistan on a watchlist of countries considered non-compliant with global anti-terror financing measures, an exclusive Reuters report said on Tuesday.

Miftah Ismail, Pakistan's de facto finance minister, told the news agency that the US and UK had nominated Pakistan to be put on the watchdog’s international money-laundering and terror-financing ‘grey list’ a few weeks ago, before France and Germany joined them as co-sponsors.

"We are now working with the US, UK, Germany and France for the nomination to be withdrawn," Ismail, who is the adviser to the prime minister on finance, revenue and economic affairs, told Reuters. "We are also quite hopeful that even if the US did not withdraw the nomination that we will prevail and not be put on the watchlist."

The motion against Pakistan could be adopted at the FATF meeting scheduled to take place in Paris from February 18 to 23.

The FATF maintains grey and black lists for identifying countries with weak measures to combat money laundering and terror financing. The watchdog does not have the powers to impose sanctions on a country found not meeting the required standards. However, its listing can affect international transactions from the country concerned as those would then become subject to greater scrutiny.

This will increase the cost of doing international/cross-border transactions and ultimately higher cost of doing business locally. Pakistan was last placed on FATF’s grey list in February 2012 and stayed on it for three years.

A senior official of the US government told Reuters that the moving of the motion is a well-thought-out manoeuvre to urge Pakistan into taking action against all militant groups rather than just selective ones.

"It is time for that to stop, and so we are working with our allies, who also are affected, to see effective action against groups such as the Haqqanis and elements of the Taliban,” the official was quoted as saying.

With the upcoming FATF meeting scheduled for next week, President Mamnoon Hussain had last Friday promulgated an ordinance amending the Anti-Terrorism Act, 1997 with regards to proscription of terrorist individuals and organisations to include entities listed by the United Nations Security Council.

A major impact of the new ordinance would be the proscription of Hafiz Saeed-linked Jamaatud Dawa and Falah-i-Insaniat Foundation along with the UN listed outfits of Al Akhtar Trust and Al Rashid Trust.