IMF Loan to Pakistan 2025: Why India Is Opposing the $2.3 Billion Bailout

The IMF approved Pakistan's economic reform review under the EFF, allowing $1 billion disbursement. India opposed funding.

Why IMF Trending in India?

After approving a $2.3 billion bailout package for pakistan The International Monetary Fund (IMF) is trending in India. This makes Indian Unhappy and intence debates in diplomatic and legal circle is going on in concern over national securities.

What Did the IMF Approve for Pakistan?

To support pakistan economic status On May 9, 2025, the IMF approved $1 billion under the Extended Fund Facility (EFF).$1.3 billion under the Resilience and Sustainability Facility (RSF)

Why Did India Object to the IMF Loan?

India objection on IMF loan to pakistan because india has doubt that money could indirectly fund Cross border terrorism. As it is seen in past Pakistan has poor track record they fail to meet IMF Condition. Pakistani Military Control over Economy can misdirect IMF funds.

What Does International Law Say?

According to Article I of the IMF’s Articles of Agreement, funds must be used

(i) To promote international monetary cooperation through a permanent institution which provides the machinery for consultation and collaboration on international monetary problems.

(ii) To facilitate the expansion and balanced growth of international trade, and to contribute thereby to the promotion and maintenance of high levels of employment and real income and to the development of the productive resources of all members as primary objectives of economic policy.

(iii) To promote exchange stability, to maintain orderly exchange arrangements among members, and to avoid competitive exchange depreciation.

(iv) To assist in the establishment of a multilateral system of payments in respect of current transactions between members and in the elimination of foreign exchange restrictions which hamper the growth of world trade.

(v) To give confidence to members by making the general resources of the Fund temporarily available to them under adequate safeguards, thus providing them with opportunity to correct maladjustments in their balance of payments without resorting to measures destructive of national or international prosperity.

(vi) In accordance with the above, to shorten the duration and lessen the degree of disequilibrium in the international balances of payments of members.

The Fund shall be guided in all its policies and decisions by the purposes set forth in this Article. If funds are misused, it violates the principles of responsible lending and this will be obligatory under international counter-terrorism law

Can India Legally Block IMF Loans?

India cannot veto IMF loans, but it can Request a review of IMF's conditionalitiesand can influence other member nation for same

Law, Loans & National Security

The IMF’s move has ignited global debate. India’s stance is a wake-up call: You can’t separate finance from geopolitics anymore.

As countries continue to grapple with terror threats and regional instability, the role of law in international finance is more important than ever.

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