India’s Defence Minister Rajnath Singh on Friday called on the International Monetary Fund (IMF) to reconsider a $1 billion loan to Pakistan, alleging that a significant portion of the funds would support terrorism. Singh made the remarks during a speech at an air force base in western India, asserting that any financial aid to Pakistan effectively finances terror activities.
Despite India’s objections, the IMF recently approved the loan program review for Pakistan, releasing $1 billion, which Pakistan’s central bank confirmed has already been received. The IMF also approved an additional $1.4 billion under its climate resilience fund. India, representing Bhutan, Sri Lanka, and Bangladesh on the IMF board, abstained from the vote, citing concerns over Pakistan’s track record in effectively utilizing IMF support.
Pakistan’s Foreign Office dismissed India’s stance as a sign of frustration and desperation. Spokesperson Shafqat Ali Khan stated that India’s failed attempt to block the loan underscores its discontent and criticized India for trying to undermine an international institution like the IMF.
Pakistan narrowly avoided default in 2023 amid political and economic crises, leading to a $7 billion IMF bailout, supplemented by further loans from allied countries. Pakistan has long been scrutinized for its efforts against militancy and illicit financing. However, in 2022, the Financial Action Task Force (FATF) removed Pakistan from its grey list after recognizing significant progress.
On Friday, Britain’s Foreign Secretary David Lammy met Pakistan’s Finance Minister Ishaq Dar in Islamabad, discussing the recent ceasefire between India and Pakistan. Meanwhile, Pakistan’s government held nationwide military celebrations.
Prime Minister Shehbaz Sharif reaffirmed Pakistan’s military readiness and commitment to defending its territory, warning that any aggression would be met with a firm response. The ongoing Kashmir dispute remains a core issue, having sparked multiple conflicts between the two nuclear-armed neighbors.
