IMF clears loan tranche to Pakistan; India abstains from vote, registers ‘strong dissent’
India opposed the frequent bailouts to Pakistan in the IMF board meeting, pointing out that such a track record calls into question either the effectiveness of the IMF programme designs for Pakistan or their monitoring or their implementation by Pakistan.
The International Monetary Fund (IMF) cleared a $1-billion tranche for Pakistan as part of its $7-billion Extended Fund Facility (EFF) lending program and $1.3 billion tranche under the Resilience and Sustainability Facility (RSF) in its board meeting held Friday. India abstained from voting in the meeting as it raised concerns over the efficacy of IMF programmes for Pakistan given its “poor track record” and also on the possibility of “misuse of debt financing funds for state-sponsored cross-border terrorism”, an official release by the Ministry of Finance, Government of India said.
India conveyed its “strong dissent” as the IMF reviewed the Extended Fund Facility (EFF) lending program ($1 billion) and also considered a fresh Resilience and Sustainability Facility (RSF) lending programme ($1.3 billion) for Pakistan. Reuters quoted Pakistan government’s statement to say that the IMF has freed $1 billion in cash after the first review of the $7 billion programme for Pakistan. The review approval brings disbursements to $2 billion within the $7 billion programme.
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 statement said.
