India Abstains on IMF Vote for Pakistan’s Additional Funds

India expressed strong concerns to the International Monetary Fund (IMF) on Friday regarding the effectiveness of its funding to Pakistan, citing the country's poor track record in adhering to program conditions and the potential misuse of funds for state-sponsored cross-border terrorism. At the IMF Executive Board meeting, which reviewed Pakistan’s $1 billion tranche under the $7 billion Extended Fund Facility (EFF) and an additional $1.3 billion under the Resilience and Sustainability Facility (RSF), India abstained from the vote.

“As an active and responsible member country, India raised concerns over the efficacy of IMF programs in the case of Pakistan, given its poor track record, and also on the possibility of misuse of debt financing funds for state-sponsored cross-border terrorism,” the Ministry of Finance (MoF) stated. The ministry noted that since 1989, Pakistan has received IMF disbursements in 28 out of 35 years, including four separate programs since 2019. The $1.3 billion RSF marks the 25th IMF loan Pakistan has availed since 1958.

India also warned that Pakistan had become too significant a debtor for the IMF to allow to fail, creating a precedent that undermines the credibility of global financial institutions. It stated that continuing to fund a country with a record of supporting cross-border terrorism could damage the reputations of international donors and make a mockery of shared global values.

The Finance Ministry added that its concerns were echoed by several member countries but noted the IMF’s response remained limited by “procedural and technical formalities.” It stressed the need for global financial institutions to incorporate moral considerations into their frameworks and acknowledged that the IMF took note of India's position and abstention.

Meanwhile, Pakistan’s Prime Minister Muhammad Shehbaz Sharif welcomed the approval of the $1 billion tranche, which brings the total disbursement under the current IMF program to $2 billion. The agreement between the IMF and the Pakistan government had reportedly been reached at the staff level before tensions escalated between New Delhi and Islamabad. The IMF did not comment when approached following the approval.

India’s decision to abstain drew criticism from the opposition Congress party. Congress General Secretary Jairam Ramesh accused the government of “chickening out,” stating that a firm 'No' vote would have sent a stronger message.

Also Read: PM Modi Convenes High-Level Meeting as Pakistan Resumes Strikes for Third Consecutive Night