NEW DELHI: India and the US today welcomed a global terror financing watchdog demoting Pakistan to a 'grey list' for underperforming in rooting out sources of finance for terrorists within its borders and for not taking enough - or any, at all - action in curbing activities of terror elements who roam freely within its provinces.The watchdog, the Paris-based Financial Action Task Force ( FATF ), on Wednesday greylisted Pakistan - an international pariah - for its support to terror. Pakistan avoided the far graver 'black list' by agreeing to comply with a 26-point action plan formulated by the International Cooperation Review Group (ICRG) of the Asia Pacific Group."India welcomes the decision of the Financial Action Task Force to place Pakistan in its Compliance Document ( grey list ) for ICRG monitoring," said India's ministry of external affairs, in a statement today.The FATF is an inter-governmental body established in 1989 to combat money laundering, terrorist financing and other related threats to the integrity of the international financial system. And to avoid FATF's black list, Pakistan has to, by January, publish updated lists of persons and entities proscribed under the Anti-Terrorism Act and the UN-designated entities.Pakistan has "outstanding counterterrorism deficiencies consistently raised by the Financial Action Task Force" and needs to take actions, including on the raising and moving of funds of UN-designated terrorist groups, a top US official said to news agency PTI yesterday.The ICRG's compliance list - to which Pakistan has agreed to work with - envisages a 26-point plan to root out and erase all sources of financing to terror groups operating within its borders, including the India-focussed Lashkar-e-Toiba (LeT) and the Jaish-e-Mohammed (JeM), and any other entities associated with these two parent groups' head, the Jamaat-ud-Dawa (JuD). The JuD is led by Hafiz Saeed who masterminded the 26/11 terror attacks in Mumbai in 2008. Also to be its targets are Daesh, the Haqqani Network, the Pakistani Taliban and al Qaida.Saeed - who has a US bounty on his head and is designated a terrorist by the UN - and other of his ilk roam freely in Pakistan, hold rallies to incite hate - against India and the US and whomever they don't like - and collect large amounts of unmonitored money for their terror activities."The freedom and impunity with which the designated terrorists like Hafiz Saeed and entities like JuD, LeT, JeM continue to operate in Pakistan is not in keeping with such commitments" by Pakistan so far, said India's external affairs ministry.And Pakistan, to be put on the grey list as opposed to being blacklisted, promised action to cut the legs from under these entities by constricting their finance sources."Pakistan has given high level political commitment to address global concerns on implementation of FATF standards for countering terror financing and anti-money laundering, especially in respect of UN designated and internationally proscribed terror entities and individuals," said India.India said it hopes Pakistan keeps to its commitments, something even the country's newspaper editorials seemed to cast doubt on yesterday. They said the 26-point plan will not be easy to implement if some real on-the-ground change and restructuring doesn't happen. And they believe this restructuring won't happen or not easily or soon enough.The US, too, said Pakistan needs to take "comprehensive actions", something India hopes it will, for the safety and security of the entire Asian region."We hope that the FATF action plan shall be complied with in a time bound manner and credible measures would be taken by Pakistan to address global concerns related to terrorism emanating from any territory under its control," said the external affairs ministry.Pakistan is the ninth country to be placed on the Paris-based FATF's grey list, the other eight being Ethiopia, Serbia, Sri Lanka, Syria, Trinidad and Tobago, Tunisia and Yemen, reported Pakistan's The Express Tribune.These nine countries have been labelled by the FATF as "jurisdictions (states) with strategic deficiencies" that can harm the international financial system if they do not take immediate steps to stop financing of terrorists and money laundering activities.