New Delhi, 9 May (H.S.): India has expressed its opposition to the International Monetary Fund’s (IMF) proposal to extend USD 2.3 billion in fresh loans to Pakistan, citing concerns that the funds may be misused to finance state-sponsored cross-border terrorism. During a recent IMF meeting, New Delhi abstained from voting, voicing apprehensions over the effectiveness of IMF programs for Pakistan, which suffers from a poor track record with debt financing. India highlighted that rewarding the continued sponsorship of cross-border terrorism sends a harmful message globally and exposes funding agencies to reputational harm, undermining international values.

India’s finance ministry stated that many member countries echoed its concerns regarding the misuse of IMF inflows for military and terrorist purposes, yet emphasized that the IMF’s response was limited by procedural formalities. This situation underscores a serious gap in considering moral values in the operations of international financial institutions.

India’s dissent also comes amidst escalating military tensions with Pakistan following a terrorist attack that killed 26 tourists in Kashmir. The statement pointed out the Pakistan military’s substantial interference in economic affairs, which poses significant risks for policy stability and reform reversals, even with a civilian government in place. A 2021 UN report noted that military-linked businesses constitute the largest conglomerate in Pakistan, with the military playing a pivotal role in economic governance. India’s concerns are further supported by findings indicating that political factors heavily influence IMF lending decisions, exacerbating Pakistan’s high debt burden, making it too big to fail for the IMF.

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Hindusthan Samachar / Jun Sarkar