India Abstains from IMF Vote on Pakistan’s $2.3 Billion Bailout, Cites Terrorism Funding Concerns

New Delhi, May 10, 2025 – India has strongly opposed the International Monetary Fund’s (IMF) decision to approve a $2.3 billion bailout package for Pakistan, abstaining from the vote during the IMF board meeting. The move comes amid growing concerns over Pakistan’s history of misusing international funds and its alleged support for cross-border terrorism.

IMF Approves $2.3 Billion Aid Despite India’s Objections

The IMF’s executive board approved two key financial assistance programs for Pakistan:

• $1 billion under the Extended Fund Facility (EFF)

• $1.3 billion under the Resilience and Sustainability Facility (RSF)

India, however, raised serious objections, highlighting Pakistan’s poor track record in adhering to IMF conditions and its potential misuse of funds.

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India’s Key Concerns: Misuse of Funds and Terrorism Sponsorship

In an official statement, India’s Finance Ministry emphasized:

• Pakistan’s persistent reliance on IMF bailouts, having borrowed in 28 of the last 35 years.

• Repeated failures in implementing IMF-mandated reforms, raising doubts about the effectiveness of such programs.

• Risks of IMF funds being diverted to military and terrorist activities, undermining global security.

India also referenced an IMF report that acknowledged “political considerations” influencing lending decisions for Pakistan. The statement warned that repeated bailouts have made Pakistan a “too-big-to-fail debtor,” perpetuating financial instability.

Global Implications: A Call for Moral Accountability in Lending

India urged the IMF and other financial institutions to reassess lending policies, ensuring that funds are not misused for state-sponsored terrorism. The government stressed that rewarding Pakistan despite its actions sets a dangerous precedent and exposes global financial bodies to reputational risks.

Political Reactions: Congress Criticizes Government’s Abstention

The opposition Congress party criticized the Modi government for only abstaining rather than voting against the bailout. Congress leader Jairam Ramesh stated:

“A strong ‘NO’ would have sent a powerful message. By abstaining, India missed an opportunity to take a firm stand.”

However, government officials clarified that IMF rules do not allow negative voting—members can only approve or abstain.

Why This Decision Matters

1. Pakistan’s Economic Crisis – The country faces severe inflation, debt distress, and political instability, making IMF aid crucial for survival.

2. India’s Security Concerns – Recent terror attacks, including the Pahalgam incident (April 2025), have heightened fears of IMF funds being diverted to militant activities.

3. Global Financial Ethics – India’s stance highlights the need for stronger safeguards in international lending to prevent misuse.

Conclusion: A Stand Against Financial Enablement of Terrorism

India’s abstention sends a clear message—financial aid should not come at the cost of global security. While the IMF’s decision stands, the debate over accountability in international lending continues.

For more updates on global finance and geopolitics, stay tuned.