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Why India could not stop IMF bailout to Pakistan

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Last week the International Monetary Fund (IMF) approved a $1bn (£756m) bailout to Pakistan – a move that drew sharp disapproval from India as military hostilities between the nuclear-armed neighbours flared, before a US-led ceasefire was unexpectedly declared.

Despite India’s protests, the IMF board approved the second instalment of a $7bn loan, saying Islamabad had demonstrated strong programme implementation leading to a continuing economic recovery in Pakistan.

It also said the fund would continue to support Pakistan’s efforts in building economic resilience to “climate vulnerabilities and natural disasters”, providing further access of around $1.4bn in funding in the future.

In a strongly worded statement India raised concerns over the decision, citing two reasons.

Delhi questioned the “efficacy” of such bailouts or the lack thereof, given Pakistan’s “poor track record” in implementing reform measures. But more importantly it flagged the possibility of these funds being used for “state-sponsored cross-border terrorism” – a charge Islamabad has repeatedly denied – and said the IMF was exposing itself and its donors to “reputational risks” and making a “mockery of global values”.

The IMF did not respond to the BBC’s request for a comment on the Indian stance.

Even Pakistani experts argue that there’s some merit to Delhi’s first argument. Pakistan has been prone to persistently seeking the IMF’s help – getting bailed out 24 times since 1958 – without undertaking meaningful reforms to improve public governance.

“Going to the IMF is like going to the ICU [intensive care unit]. If a patient goes 24 or 25 times to the ICU then there are structural challenges and concerns that need to be dealt with,” Hussain Haqqani, former Pakistani ambassador to the US, told the BBC.

A sign for the IMF is seen during the 2025 IMF and World Bank Spring Meetings at IMF Headquarters in Washington, DC, USA 25 April 2025.
As one of the 25 members of the IMF board, India’s influence at the fund is limited

But addressing Delhi’s other concerns – that the IMF was “rewarding continued sponsorship of cross-border terrorism” thereby sending a “dangerous message to the global community” – is far more complex, and perhaps explains why India wasn’t able to exert pressure to stall the bailout.

India’s decision to try to prevent the next tranche of the bailout to Islamabad was more about optics then, rather than a desire for any tangible outcome, say experts. As per the country’s own observations, the fund had limited ability to do something about the loan, and was “circumscribed by procedural and technical formalities”.

As one of the 25 members of the IMF board, India’s influence at the fund is limited. It represents a four-country group including Sri Lanka, Bangladesh and Bhutan. Pakistan is part of the Central Asia group, represented by Iran.

Unlike the United Nations’ one-country-one-vote system, the voting rights of IMF board members are based on a country’s economic size and its contributions – a system which has increasingly faced criticism for favouring richer Western countries over developing economies.

For example, the US has the biggest voting share – at 16.49% – while India holds just 2.6%. Besides, IMF rules do not allow for a vote against a proposal – board members can either vote in favour or abstain – and the decisions are made by consensus on the board.

“This shows how vested interests of powerful countries can influence decisions,” an economist who didn’t want to speak on the record told the BBC.

Addressing this imbalance was a key proposal in the reforms mooted for the IMF and other multilateral lenders during India’s G20 presidency in 2023.

In their report, former Indian bureaucrat NK Singh and former US treasury secretary Lawrence Summers recommended breaking the link between IMF voting rights and financial contributions to ensure fairer representation for both the “Global North” and the “Global South”. But there has been no progress so far on implementing these recommendations.

Furthermore, recent changes in the IMF’s own rules about funding countries in conflict add more complexity to the issue. A $15.6bn loan by the fund to Ukraine in 2023 was the first of its kind by the IMF to a country at war.

“It bent its own rules to give an enormous lending package to Ukraine – which means it cannot use that excuse to shut down an already-arranged loan to Pakistan,” Mihir Sharma of the Observer Research Foundation (ORF) think tank in Delhi told the BBC.

Indian People walk past the newly unveiled G20 logo in New Delhi, India on 1 December 2022.
Reforms to the IMF’s voting structure were discussed during India’s G20 presidency in 2023

If India really wants to address its grievances, the right forum to present them would be the United Nations FATF (Financial Action Task Force), says Mr Haqqani.

The FATF looks at issues of combating terror finance and decides whether countries need to be placed on grey or black lists that prevent them from accessing funds from bodies like the IMF or the World Bank.

“Grandstanding at the IMF cannot and did not work,” said Mr Haqqani. “If a country is on that [FATF] list it will then face challenges in getting a loan from the IMF – as has happened with Pakistan earlier.”

As things stand though, Pakistan was officially removed from the Financial Action Task Force (FATF) grey list in 2022.

Separately, experts also caution that India’s calls to overhaul the IMF’s funding processes and veto powers could be a double-edged sword.

Such reforms “would inevitably give Beijing [rather than Delhi] more power”, said Mr Sharma.

Mr Haqqani agrees. India should be wary of using “bilateral disputes at multilateral fora”, he said, adding that India has historically been at the receiving end of being vetoed out by China in such places.

He points to instances of Beijing blocking ADB (Asian Development Bank) loans sought by India for the north-eastern state of Arunachal Pradesh, citing border disputes between the two countries in the region.

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Israel’s Bases in Iran and Iraq and Threat to Pakistan

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Paris (Imran Y. CHOUDHRY) :- Former Press Secretary to the President, Former Press Minister to the Embassy of Pakistan to France, Former MD, SRBC Mr. Qamar Bashir analysis : The June war between Israel and Iran revealed a frightening new reality of modern warfare: nations are no longer defeated only by armies crossing borders or fighter jets bombing cities. Increasingly, wars are prepared from within. The real battlefield now lies inside societies, intelligence networks, covert safe houses, cyber systems, recruited insiders, and hidden operational bases quietly established years before conflict begins.
What shocked military analysts during the June conflict was not merely the intensity of Israeli airpower, but the astonishing precision with which Iran’s top military commanders, nuclear scientists, IRGC leadership, missile batteries, and strategic facilities were targeted. According to multiple international investigations published by The New York Times, The Wall Street Journal, and The Times of Israel, many of these attacks were enabled through covert Israeli operational networks functioning deep inside Iran itself.
Reports suggest that Mossad had spent years cultivating Iranian dissidents, smugglers, contractors, and covert assets near strategic locations such as Tehran, Natanz, Isfahan, and other sensitive military and nuclear sites. Through these embedded networks, Israeli intelligence reportedly obtained precise coordinates, movement patterns, communication details, and even internal meeting schedules of senior Iranian officials.
The result was devastating. Nuclear scientists were assassinated with pinpoint precision. Missile launchers were neutralized before activation. Air-defense systems were disabled from within. Underground command centers were reportedly identified and struck with astonishing accuracy. Even senior Iranian military gatherings were allegedly tracked through cyber deception operations and internal informants.
Iran later admitted the scale of internal infiltration by launching mass arrests across the country. Thousands were detained on accusations of espionage, treason, and collaboration with foreign intelligence services. Iranian authorities claimed that many individuals had shared coordinates of military sites and strategic locations with Israeli operatives. Tehran’s response reflected a painful realization: much of the war had already been prepared inside Iran long before the first missile was fired. But the most alarming development emerged later.
International media reports revealed that Israel had allegedly established covert operational bases inside Iraq as well. According to these reports, hidden facilities in Iraq’s western desert were used for reconnaissance, logistics, emergency pilot support, intelligence gathering, and preparation for attacks deep inside Iran. Some reports suggested these installations dated back to 2024 and were operational during both the 2025 and 2026 conflicts.
The implications are enormous. If covert Israeli infrastructure could function inside countries openly hostile to Israel, then no regional state can assume immunity from similar penetration.
This is where the danger becomes particularly serious for Pakistan.
Pakistan today faces a highly sensitive strategic environment. The growing convergence between India, Israeli strategic interests, and evolving Taliban-controlled dynamics inside Afghanistan creates a deeply concerning security equation for Islamabad. Afghanistan’s geography alone makes it an ideal staging ground for intelligence operations targeting both Pakistan and Iran. Its porous borders, fragmented governance structures, smuggling networks, militant corridors, refugee movements, and weak centralized intelligence oversight create an operational environment where covert infrastructure can potentially be established with relative ease.
Israel’s operational doctrine, as demonstrated in Iran and Iraq, appears increasingly dependent on first creating hidden operational ecosystems inside or near adversarial states before open conflict begins. Such ecosystems may start as small reconnaissance cells, logistics hubs, communications nodes, safe houses, drone launch sites, cyber relay stations, or intelligence listening posts. Over time, they mature into fully operational covert bases capable of supporting sabotage, surveillance, targeted assassinations, and precision military operations.
This is precisely why Pakistan must now view Afghanistan not merely through the lens of terrorism or border security, but through the broader framework of strategic intelligence warfare.
The danger is compounded by the existing instability in regions like Balochistan and Khyber Pakhtunkhwa. Long-running insurgencies, political polarization, smuggling routes, militant financing channels, ethnic grievances, and cross-border trafficking networks create fertile ground for foreign intelligence agencies seeking recruitment opportunities or covert operational access. Such environments are vulnerable to exploitation by any sophisticated intelligence service capable of leveraging local actors, financial desperation, ideological divisions, or anti-state sentiments.
If covert Israeli networks could allegedly penetrate the heavily monitored security structure of Iran, then Pakistan cannot afford complacency.
The warning is clear and urgent: Pakistan and Iran must immediately strengthen their counterintelligence cooperation regarding Afghanistan. Both countries need to activate deep intelligence monitoring systems capable of detecting even rudimentary efforts to establish covert operational infrastructure near their borders. Intelligence operations can no longer remain reactive. They must become aggressively preemptive.This requires several immediate strategic measures.
First, Pakistan and Iran must significantly expand intelligence penetration inside Afghanistan itself. Monitoring militant networks alone is no longer sufficient. Greater focus must now be placed on suspicious logistics activities, foreign funding channels, unexplained infrastructure projects, covert aviation activity, encrypted communications networks, and unusual movements near sensitive border regions.
Second, Pakistan’s intelligence agencies must intensify scrutiny over recruitment pipelines operating through financial networks, NGOs, smuggling channels, technology firms, cross-border trade routes, and ideological organizations. Modern intelligence warfare rarely begins with soldiers; it begins with local facilitators.
Third, sensitive military, nuclear, communication, and leadership infrastructure inside Pakistan must undergo a complete security reassessment. The Iranian experience demonstrated that covert targeting becomes possible only after years of surveillance, infiltration, and mapping. Preventing such penetration requires constant internal vetting, cyber monitoring, communication discipline, and aggressive counterespionage measures.
Fourth, strategic coordination between Pakistan, Iran, Turkey, and other regional states must expand beyond diplomacy into active intelligence-sharing frameworks focused specifically on covert foreign operational networks.
The reality of modern warfare is brutal. By the time airstrikes begin, the enemy may already have spent years building the battlefield from inside your territory.
This is why the June war should not merely be studied as a military confrontation between Israel and Iran. It should be understood as a case study in how intelligence penetration, covert bases, recruited insiders, cyber deception, and hidden logistics networks can cripple even powerful states from within.
For Pakistan, the lesson is existential. The greatest threat may not come from visible armies massing at the border, but from invisible networks silently embedding themselves within vulnerable spaces long before conflict erupts. Afghanistan’s instability, combined with emerging India-Israel strategic alignment, creates precisely the type of environment where such covert infrastructure could potentially take root.
Time, therefore, is not on the side of complacency. Pakistan, Iran, and other regional powers must act now — before covert operational ecosystems mature into irreversible strategic threats. Once such networks become deeply entrenched, the cost of dismantling them becomes extraordinarily high, and the damage they can inflict may already be beyond repair.

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Berlin event highlights Pakistan’s strategic restraint and national unity

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BERLIN, Germany — The Embassy of Pakistan in Berlin marked the first anniversary of Maarka‑e‑Haq (The Battle of Truth) with a solemn ceremony that highlighted Pakistan’s national unity, strategic restraint, and commitment to regional peace.

Addressing the gathering, Pakistan’s Ambassador to Germany, H.E. Saqlain Syeda , described Pakistan’s conduct during Operation Bunyan‑un‑Marsoos as an example of responsible and principled statecraft. She noted that Pakistan’s response to Indian aggression was “measured, lawful, and firmly rooted in international norms,” adding that the country’s political and military leadership demonstrated exceptional coordination at a critical moment.

Ambassador Ms.Syeda praised the “unshakeable resolve” of Pakistan’s Armed Forces, commending their readiness to safeguard the nation’s sovereignty and territorial integrity. She also underscored the importance of public support, which she said played a vital role in strengthening the country’s unified stance during the crisis.

Prominent German‑Pakistani businessman Manzoor Awan emphasized the urgent need for unity and national cohesion in Pakistan, stating that collective strength remains the country’s greatest asset in times of challenge.

Speaking at the event, Awan noted that Pakistanis have historically stood together as a united nation. He stressed that strong coordination between the public and the government is essential for confronting external threats, adding that “with unity, not only India but any major adversary can be faced with confidence.”

Awan reaffirmed the unwavering support of the Pakistani people for the Pakistan Army, saying that whenever the nation encounters danger, the public and the armed forces respond together with courage and determination.

Members of the Pakistani diaspora in Germany also spoke at the event, expressing solidarity and national pride. They voiced appreciation for Pakistan’s civil and military leadership and emphasized that diplomacy, unity, and strategic patience remain essential for maintaining regional stability.

Participants reaffirmed their confidence in Pakistan’s leadership and reiterated their commitment to contributing to the country’s progress, prosperity, and global standing.

The ceremony concluded with the screening of a documentary on Operation Bunyan‑un‑Marsoos, offering attendees a detailed account of the events and the national response it inspired.

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Delegation of students from the Comité Interuniversitaire des Nations Unies de Paris (CINUP) visited the Embassy of Pakistan in Paris

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Paris (Imran Y. CHOUDHRY):- A delegation of students from the Comité Interuniversitaire des Nations Unies de Paris (CINUP) visited the Embassy for interactive session with Ambassador Mumtaz Zahra Baloch.

During the session, the students were given a detailed presentation on Pakistan’s role in multilateral diplomacy, with a particular focus on its engagement with international organizations based in Paris. The presentation was followed by an insightful question-and-answer session.

Ambassador Mumtaz Zahra Baloch underscored Pakistan’s commitment to multilateralism, international law, and peaceful settlement of disputes. She also briefed them on the constructive role played by Pakistan in advancing the mandate of and championing the priorities of developing countries.

CINUP is a Paris-based student organization that promotes awareness and engagement with the work of the United Nations and multilateral diplomacy.

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