Summary:
The government of India has raised concerns at an International Monetary Fund (IMF) review regarding the effectiveness and management of its economic programs in Pakistan, particularly focusing on the Extended Fund Facility program amounting to $1 billion and a new Resilience and Sustainability Facility program worth $1.3 billion. India emphasizes that Pakistan's history as a lender with significant IMF involvement has resulted in poor policy implementation and adherence to program conditions over 35 years since 1989. In particular, the Indian government is wary of Pakistan's military's considerable influence on national economic matters, which could pose risks for policy consistency and reform progress. The intervention of military interests into economics is seen as a contributing factor to past failures and the perpetuation of negative economic cycles that necessitate frequent IMF interventions. India also addresses the implications of Pakistan's high debt burden in relation to supporting state-sponsored terrorism actions, advocating for the implementation of mechanisms that prevent such activities from benefiting financially from international funding. The overall sentiment highlights a concern about global financial institutions' practices when dealing with countries with significant policy and security issues.
Key Entities Referenced
Ministry of Finance India: The governmental body representing India's financial interests.
IMF: The International Monetary Fund, a global financial institution.
PIB Delhi: Press Information Bureau, Delhi - likely the source of the press release.
International Monetary Fund: The full name of the IMF.
Extended Fund Facility: A lending program offered by the IMF (EFF).
EFF: Abbreviation for the Extended Fund Facility.
Resilience and Sustainability Facility: A lending program offered by the IMF (RSF).
RSF: Abbreviation for the Resilience and Sustainability Facility.
Pakistan: A country that is the subject of the IMF lending programs mentioned in the text.
UN: The United Nations.
Special Investment Facilitation Council of Pakistan: An organization within Pakistan in which the Pakistan Army plays a leading role
IMF Report on Evaluation of Prolonged Use of IMF Resources: A specific report by the IMF addressing concerns about lending to Pakistan.
NBKMN: Likely an internal reference code or identifier for the press release.
2025: The year the press release was posted
2019: Reference year for IMF programs.
2021: Reference year for UN report.
1 billion: Amount of the Extended Fund Facility (EFF) lending program.
1.3 billion: Amount of the fresh Resilience and Sustainability Facility (RSF) lending program.
1989: Reference year for Pakistan disbursements from the IMF.
Ministry of Finance
India's stand in the IMF
Posted On: 09 MAY 2025 9:21PM by PIB Delhi
The International Monetary Fund (IMF) today reviewed the Extended Fund Facility (EFF) lending program
($1 billion) and also considered a fresh Resilience and Sustainability Facility (RSF) lending program ($1.3
billion) for Pakistan. As an active and responsible member country, India raised concerns over the efficacy of
IMF programs in case of Pakistan given its poor track record, and also on the possibility of misuse of debt
financing funds for state sponsored cross border terrorism.
Pakistan has been a prolonged borrower from the IMF, with a very poor track record of
implementation and of adherence to the IMF’s program conditions. In the 35 years since 1989,
Pakistan has had disbursements from the IMF in 28 years. In the last 5 years since 2019, there
have been 4 IMF programs. Had the previous programs succeeded in putting in place a sound
macro-economic policy environment, Pakistan would not have approached the Fund for yet another
bail-out program. India pointed out that such a track record calls into question either the
effectiveness of the IMF program designs in case of Pakistan or their monitoring or their
implementation by Pakistan.
Pakistan military’s deeply entrenched interference in economic affairs poses significant risks of
policy slippages and reversal of reforms. Even when a civilian government is in power now, the
army continues to play an outsized role in domestic politics and extends its tentacles deep into the
economy. In fact, a 2021 UN report described military-linked businesses as the “largest
conglomerate in Pakistan”. The situation has not changed for the better; rather the Pakistan Army
now plays a leading role in the Special Investment Facilitation Council of Pakistan.
India flagged the Pakistan chapter of the IMF Report on Evaluation of Prolonged Use of IMF
Resources. The report noted that there was a widespread perception that political considerations
have an important role to play in the IMF lending to Pakistan. As a result of repeated bailouts,
Pakistan’s debt burden is very high, which paradoxically makes it a too big to fail debtor for the IMF.
India pointed out that rewarding continued sponsorship of cross-border terrorism sends a
dangerous message to the global community, exposes funding agencies and donors to reputational
risks, and makes a mockery of global values. While the concern that fungible inflows from
international financial institutions, like IMF, could be misused for military and state sponsored cross
border terrorist purposes resonated with several member countries, the IMF response is
circumscribed by procedural and technical formalities. This is a serious gap highlighting the urgent
need to ensure that moral values are given appropriate consideration in the procedures followed by
global financial institutions.
The IMF took note of the India’s statements and its abstention from the vote.
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NB/KMN
(Release ID: 2127998)