IT is by now sufficiently obvious that rumours of Pakistan having been ‘blacklisted’ by the regional affiliate of the Financial Action Task Force was malicious fake news, floated initially by the Press Trust of India. From there, the word was amplified by prominent Indian journalists on social media, and it then echoed large in various other Indian news outlets. The news was deliberately angled to make the real outcome of the meeting appear to be something that it was not. The language used by the Indian media was that Pakistan was placed on an ‘enhanced blacklist’ by the Asia Pacific Group, the regional affiliate of FATF, whereas the reality was that Pakistan had been placed in a category called ‘enhanced follow up’. The word ‘blacklist’ was added to warp the meaning of the story into something altogether different. In fact, the APG does not maintain any ‘blacklist’, and FATF is not scheduled to make any decision on Pakistan until October.

In the meantime, the rumour spread like wildfire in Pakistan. The stock market, which had seen a bull run for four days, opened on a positive note on Friday, but then took steep losses right after the ‘blacklisting’ story broke. Market players confirmed that investor anxiety about a possible blacklisting was behind the declines. By the close of trade, a weeklong bull run had ended, with the market falling by 534 points. The government was slow in responding, given the speed with which the rumour spread. The first word we heard from the finance ministry came around 12:45pm, when a short, single-line ticker was released for TV channels denying the news. That had no effect. Less than an hour later, local media outlets began uploading the correct version of the story based on their own reporting, again to little effect. A more detailed contradiction was issued by the finance ministry shortly after 2pm, which too had little effect till the day’s end. It is worth asking now why investors and the wider public in Pakistan no longer know whether or not to believe what the government and the local media tell them. The current atmosphere of censorship has created a gulf between Pakistani institutions — both the media and government — and their audience, in a way that the country has become vulnerable to fake news attacks originating from outside. Restoring this trust and credibility between the government and media is now key to thwarting a similar episode.

Published in Dawn, August 25th, 2019