India intends to speak with all multilateral development banks (MDBs) to push back against providing funds and loans to Pakistan against the backdrop of a terror attack in Kashmir last week, a senior government official said.
The move to directly approach MDBs, including the World Bank, the IMF, and the Asian Development Bank, is part of the government’s broader efforts to curb financial flows that aid Pakistan to fund terror activities.
“We will flag India’s concerns to the IMF, World Bank, ADB, and other multilateral agencies. There needs to be a review of development funding to Pakistan due to links with terror financing,” the senior government official said on the condition of anonymity.
India is stepping up its ante against Pakistan following the attack on April 22 that killed 26 tourists in Pahalgam, and is looking at several measures aimed at tightening financial flows to the neighbouring country. On Friday, had reported that the government is also working towards bringing Pakistan back into the ‘grey list’ of Financial Action Task Force (FATF), the global money laundering and terror financing watchdog.
India is likely to raise concerns against Pakistan in forthcoming board meetings of the multilateral agencies. The IMF’s Executive Board will meet on May 9 to review financing facilities extended to Pakistan, according to information available on its website.
The IMF is financing a $7-billion aid package to Pakistan that was approved in September 2024. The ongoing 37-month long Extended Fund Facility programme of the IMF consists of six reviews over the span of the bailout, and the release of the next tranche of approximately $1 billion will be contingent upon the success of the performance review.
The World Bank has committed up to $50 billion to Pakistan for close to 400 projects, which includes a $20 billion loan signed in January this year. Then, in March, it had approved another $102 million for financing climate resilience. As recently as last week, it also greenlit $108 million for two projects in Pakistan’s Khyber Pakhtunkhwa province, according to a report on April 29 by Karachi-headquartered newspaper Dawn.
The World Bank’s Board of Executive Directors usually meets twice a week on Tuesdays and Thursdays. The ADB has a board meeting scheduled on May 20.
Pakistan joined the IMF and the World Bank in 1950. Since then, the IMF has supported Pakistan with 25 financial arrangements. Currently, the World Bank’s portfolio includes 54 projects in Pakistan with a total commitment of $15.7 billion. As of 2024-end, the ADB has committed over 700 public sector loans, grants, and technical assistance totaling $43.4 billion to Pakistan.
