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Even as India vehemently objected, the International Monetary Fund (IMF) granted a $1 billion bailout for Pakistan in a contentious decision that has caused indignation and international alarm. India, which chose not to vote, cautioned that, with Pakistan's poor record of reform, military meddling, and cross-border aggressiveness, the loan would wind up funding state-sponsored terrorism. Why, therefore, did the IMF continue to say yes? And what does this portend for the future of international accountability, the stability of South Asia, and world peace?

1. A Billion-Dollar Risk?

Islamabad, March 26 The International Monetary Fund (IMF) has reached a staff-level agreement with Pakistan for a $1.3 billion loan package for a period of 28 months to support the country's efforts to mitigate and adapt to climate change.

India strongly challenged the core of the IMF’s decision, highlighting Pakistan’s consistently poor track record with previous bailouts. Citing repeated failures to implement reforms, chronic economic mismanagement, and a pattern of broken promises, India argued that providing yet another loan is both reckless and futile. It likened the move to pouring water into a leaking bucket—wasting global resources with little hope for real change. India questioned why the IMF would continue supporting a nation that repeatedly ignores conditions, undermining the credibility of global financial oversight and risking further instability in the region.

2. Could This Money Fund Terror?

Beirut, March 12 (IANS) The International Monetary Fund (IMF) urged Lebanon on Wednesday to adopt a unified financial reform programme to facilitate economic recovery and restore investor confidence.

India clearly expressed its worries, alerting the world community to a serious risk: what if this IMF bailout turns out to be a catalyst for terrorism? India questioned the idea of providing funding without stringent control, citing Pakistan's history of alleged involvement in cross-border terrorist activities. It contended that instead of promoting reform, such unaccountable financial support could be abused to fund violence. India emphasised that this is a danger to international security and is not merely a regional problem. India feels that disregarding these warnings damages the reputation and ethical obligations of global financial institutions in addition to giving harmful individuals more power.

3. Who Really Controls Pakistan’s Economy?

Islamabad, May 2 The government of Pakistan has decided to issue a formal diplomatic notice to India over its "unilateral decision" to put the Indus Waters Treaty (IWT) in abeyance after the Pehalgam terror attack in which 26 innocent civilians were gunned down by four terrorists, including two Pakistanis, on April 22.

India expressed grave concerns about Pakistan's military's extensive and unbridled economic influence. India cited a UN study from 2021 when pointing out that companies with military ties are the biggest conglomerate in the nation, managing enormous amounts of money that are not subject to public authority. This brings up serious issues with accountability, change, and transparency. How can real economic reforms occur while the army still controls important sectors? More importantly, does Pakistan's strong military elite or its citizens stand to gain more from foreign assistance? India contends that such bailouts run the risk of strengthening the wrong people and upending long-term stability in the absence of structural change.

4. IMF Ignored Red Flags?

International Monetary Fund (IMF) Managing Director Kristalina Georgieva speaks at the forum Tokenization and the Financial System during the World Bank/IMF Spring Meetings at the International Monetary Fund (IMF) headquarters in Washington, Wednesday, April 23, 2025. (AP Photo/Jose Luis Magana)

The IMF authorised the $1 billion loan for Pakistan in spite of India's numerous grave reservations. India expressed its profound displeasure and cautioned that the credibility of international organisations like the IMF would be damaged by such a move. The IMF runs the risk of harming its credibility and creating a risky precedent by ignoring Pakistan's past of economic mismanagement and alleged backing for cross-border terrorism. India contends that rewarding a country that has been accused of financing terrorism sends the incorrect message to the world community and jeopardises the accountability, peace, and responsible financial support ideals that organisations like the IMF are supposed to promote.

5. A Dangerous Precedent for the World

India will put forward its perspective before IMF as it reviews Pakistan bailout package

This decision goes far beyond the borders of India and Pakistan—it raises a crucial question for the entire world. When global institutions like the IMF fund countries accused of supporting terrorism, what message does that send? India’s warning isn’t just regional; it’s a cautionary alarm for the global community. If financial aid comes without accountability, it sets a dangerous precedent—one where nations with terror links can exploit the system. It risks turning global peacekeeping institutions into silent enablers. This moment demands reflection: are we financing stability or fueling future conflict under the guise of economic support?

Even After India Warns: "This Could Fund TerrorThe IMF’s $1 billion bailout to Pakistan has ignited more than just economic debate—it has sparked a global moral and geopolitical storm. India’s decision to abstain wasn’t merely a diplomatic gesture; it was a bold alarm to the international community. With a history of failed reforms and alleged terror links, Pakistan’s bailout raises disturbing questions: Is the world turning a blind eye for the sake of diplomacy? Are lives being risked under the guise of financial rescue? This moment marks a critical test of global conscience, because when funding overlooks accountability, peace itself becomes the price.



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