With India's Latest Strategic Move, Pakistan To Go Bankrupt

India has expressed concerns to the International Monetary Fund (IMF) about its financial assistance to Pakistan. New Delhi fears these funds might be diverted to support military and intelligence networks, including groups like Lashkar-e-Taiba (LeT) and Jaish-e-Mohammed (JeM). This comes amid rising tensions following a deadly attack in Pahalgam on April 22, which claimed 26 lives.

The IMF is set to review Pakistan's funding on May 9. This meeting will evaluate if Pakistan has adhered to the reform benchmarks necessary for the next funding tranche. Previously, Pakistan received a $7 billion bailout from the IMF and an additional $1.3 billion in March for climate resilience efforts.

India's Diplomatic Moves

In response to the Pahalgam attack, India has taken diplomatic steps against Islamabad. On May 7, India initiated Operation Sindoor, targeting nine sites linked to terrorism across the border. These actions have further strained relations between the two countries.

Pakistan is seeking another $1.3 billion from the IMF under its economic stabilisation programme. The country relies heavily on these loans due to its ongoing fiscal crisis. The IMF's review will determine if Pakistan qualifies for more funds under this programme.

Concerns Over Fund Misuse

India has urged global agencies, including the IMF, to reassess their financial support to Pakistan. New Delhi aims to diplomatically corner its neighbour after the recent terror attack in Pahalgam. The concern is that these funds might not only bolster Pakistan's economy but also potentially support terrorism.

The IMF Executive Board's meeting with Pakistani officials will include discussions on an arrangement under the resilience and sustainability facility. This facility aims to address challenges like climate resilience in economically vulnerable countries.