India Reacts to IMF: The IMF has backed a billion-dollar loan package for Pakistan amid ongoing tensions with India, saying it has met all its targets. India has expressed displeasure over the loan to Pakistan, which it says is a haven for terrorism, and Rajnath Singh said it is funding terrorism. The IMF has warned that tensions with India could threaten economic goals and has imposed new conditions. The IMF’s decision has also drawn international criticism.
There is a lot of international criticism regarding the loan to Pakistan. In this regard, the US military advisor has criticized the Trump administration. India has also made comments that it should reconsider the loan. Recently, the International Monetary Fund ( IMF ) has responded to this. The IMF has approved the billion dollar (about Rs. 8,000 crore) package given to Pakistan. It has been stated that the latest tranche of the package has been released because Pakistan has fulfilled all the necessary targets. The IMF released this loan during the clashes between the two countries after the Indian Army launched attacks on terrorist camps in Pakistan-occupied Kashmir (PoK) in the name of Operation Sindoor.
India has recently expressed deep dissatisfaction with the IMF ‘s decision. It has asked for a review of the loan to Pakistan, which has turned terrorism into a policy and is providing shelter to terrorists and carrying out attacks on India. Indian Defense Minister Rajnath Singh said, “The aid given by Pakistan is indirectly funding terrorism.”
The IMF has released $2.1 billion (Rs. 16,500 crore in Indian currency) in two tranches under the bailout package for Pakistan. The total loan agreement for $7 billion was signed last year. “Pakistan has achieved all the targets, there has been progress in some reforms. Therefore, our board has approved this loan,” IMF Communications Department Director Julie Kozak said at a media briefing.
“We planned to conduct the first review in the first quarter of 2025, On March 25, 2025, IMF staff and Pakistani officials signed an agreement on this review. The agreement was presented to our Executive Board on May 9, and the review was completed. With this, the tranche of funds was released to Pakistan,” she explained.
Responding to the India-Pakistan tensions, Julie Kozak said, “Our deepest condolences to those who lost their lives in this conflict. We hope for a peaceful resolution to this conflict.” Meanwhile, the IMF has imposed 11 new conditions on Pakistan for the final tranche of the loan. The IMF said that tensions with India could threaten the economic and reform objectives of this program. Moreover, it warned that escalating conflicts with India would be a loss for you. The IMF warned that tensions with a neighboring country could jeopardize the economic and reform objectives of this program.
Now, the IMF conditions for Pakistan include Rs. The new budget of Rs 17.6 lakh crore needs parliamentary approval. It includes hike in charges on debts in electricity bills. It also includes lifting of restrictions on imports of used cars older than three years. Moreover, four provinces in Pakistan must implement agricultural income tax laws. This includes the process of tax returns, identification of taxpayers, registration, awareness campaign and implementation scheme. The deadline for this is June 2025.
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