India Urges IMF to Scrutinize Pakistan’s Loan Agreements Amid Rising Tensions

NEW DELHI/KARACHI: Amid escalating tensions following a recent deadly incident in Indian Illegally Occupied Jammu and Kashmir (IIOJK), India has formally requested the International Monetary Fund (IMF) to reassess the loans provided to Pakistan, according to a source within the Indian government.

The call for review comes as both India and Pakistan have initiated various actions in the aftermath of an attack on Hindu tourists in IIOJK, resulting in multiple fatalities. Concerns are mounting that this renewed crisis between the two nuclear-armed nations could potentially escalate into a broader military confrontation.

India alleges that two of the three attackers identified were Pakistani nationals. Islamabad has refuted any involvement and has advocated for an impartial inquiry. Concurrently, India has suspended a crucial water-sharing treaty, and both countries have imposed airspace restrictions on each other’s airlines.

Pakistan’s financial stability hinges on a $7 billion bailout package secured from the IMF last year, further supplemented by a $1.3 billion climate resilience loan approved in March. The nation emphasized that the bailout has been instrumental in averting a potential default.

The Indian government source indicated that India has communicated its apprehensions regarding the IMF loans to Pakistan and requested a thorough evaluation. Neither the IMF nor India’s finance ministry has issued an immediate response to these developments.

An advisor to Pakistan’s finance minister stated that the IMF program remains “firmly on track.”

“The most recent evaluation was successful, and we are completely on schedule,” Khurram Schehzad, the advisor, stated, noting Pakistan’s productive discussions with financial institutions in Washington during the spring meetings. Schehzad added, “Interest in investing and supporting Pakistan has been notably high as the economy recovers, with approximately 70 meetings conducted.”

The heightened tensions between India and Pakistan have garnered international attention, prompting appeals for de-escalation. US Vice President JD Vance expressed hope that Pakistan would cooperate with India in apprehending the assailants allegedly based in Pakistan.