IMF has approved a loan of one Billion dollars to Pakistan
Amid heightened tensions triggered by the ongoing India-Pakistan conflict, the International Monetary Fund (IMF) has approved a $1 billion loan package to Pakistan, sparking strong protests from India. The financial assistance comes at a time when Pakistan’s economy is severely strained and its ability to sustain a prolonged conflict appears uncertain.
India Opposes IMF Support to Pakistan
In a critical meeting held on Friday, the IMF board convened to assess Pakistan’s request under the Extended Fund Facility (EFF). India, which has been locked in a military standoff with Pakistan, formally objected to the approval of the loan. Indian representatives voiced serious concerns over Pakistan’s historical misuse of international funds and its continued support for terror-related activities.
Despite India’s objections, the IMF board voted in favor of Pakistan. India abstained from the final vote, a move that inadvertently contributed to the loan approval. The IMF has agreed to disburse $1 billion (approximately ₹8,500 crore) to Pakistan, providing the country with critical financial support as it faces escalating military and economic pressures.
Pakistan's Economic Struggles and Diplomatic Outreach
In the wake of India’s recent military action, Pakistan has reached out to international allies and financial institutions seeking assistance. With its economy in dire condition, analysts suggest that Pakistan lacks the fiscal strength to sustain a long-term war effort.
India, in its protest to the IMF, highlighted Pakistan’s track record of mismanagement and the potential risks of enabling further destabilizing actions through unchecked financial support. New Delhi warned that IMF funds could be misused, especially in the context of regional security concerns and Pakistan’s ongoing support for extremist elements.
Geopolitical Implications
The IMF’s decision to approve the loan despite India’s protest is likely to add strain to international diplomatic relations. The move has been viewed in India as a failure to hold Pakistan accountable for actions that threaten regional peace.
India has reiterated its demand that international financial bodies enforce stricter conditionalities and accountability measures before releasing funds to states with a history of supporting terrorism.
As the conflict continues to unfold, the geopolitical ramifications of economic and military decisions are becoming increasingly complex. The situation remains fluid, with further developments expected in the coming days.