New Delhi: In a sharp escalation of diplomatic pressure, India has urged the International Monetary Fund (IMF) to reassess its financial support to Pakistan, following a recent deadly terror attack in Jammu and Kashmir’s Pahalgam region that claimed 26 lives, government sources revealed to Reuters on Friday.
The attack, which targeted Hindu pilgrims in the conflict-ridden Indian-administered Kashmir, has reignited hostilities between the two nuclear-armed neighbours. Indian authorities have identified the three assailants—two of whom are alleged to be Pakistani nationals—as terrorists. Pakistan has categorically denied involvement and has called for an impartial international investigation.
In the wake of the incident, both nations have adopted hardline stances. India has suspended a key river water-sharing agreement, while both countries have barred each other’s aircraft from their respective airspaces.
Amid these developments, India has formally expressed its concerns to the IMF over ongoing financial aid to Pakistan. The IMF last year approved a $7 billion bailout programme for Islamabad, followed by an additional $1.3 billion climate resilience loan granted in March. The funding has been crucial in stabilizing Pakistan’s $350 billion economy and averting a potential default.
An Indian government official, speaking on condition of anonymity, confirmed that New Delhi has asked the IMF to review its financial arrangements with Pakistan. The official declined to provide further details.
The diplomatic standoff marks a fresh strain in already fraught Indo-Pakistani relations, with the potential to impact regional stability and international economic engagement with South Asia.
