The IMF has approved a $1 billion loan to Pakistan under its ongoing $7 billion bailout, despite India’s strong opposition. India raised concerns over Pakistan’s misuse of such funds and its track record of economic mismanagement. However, the IMF cited Pakistan’s reform progress and resilience-building as reasons for the loan, leaving India with limited influence due to its small voting share on the IMF board.

BulletsIn

• IMF approved $1B loan to Pakistan last week under a $7B bailout package
• India opposed loan citing Pakistan’s terror links, poor reform record
• IMF defended decision, citing Pakistan’s reform progress and recovery signs
• India warned IMF risked aiding cross-border terrorism, hurting global values
• IMF board decisions need consensus; no provision for veto or negative vote
• India has only 2.6% IMF voting share vs US’s 16.49% – limited influence
• IMF rules allow only support or abstention, not outright rejections
• Experts say India’s protest was more symbolic, lacked real power to block
• India suggested reforming IMF’s voting rules during its G20 presidency in 2023
• Experts warn reforms could shift power to China, potentially harming India