The International Monetary Fund (IMF) is facing sharp criticism for approving a $1 billion disbursement to Pakistan just days after a deadly terrorist attack in Kashmir’s Pahalgam and amid escalating hostilities between India and Pakistan.

The disbursement, approved on Friday under the Extended Fund Facility (EFF), raises total payouts under the programme to $2.1 billion. Additionally, the IMF cleared $1.4 billion under the Resilience and Sustainability Facility (RSF), ostensibly aimed at helping Pakistan tackle climate-related vulnerabilities.

But the timing of the announcement has provoked a fierce backlash, not just from Indian officials and strategic experts, but also from voices in the region and beyond who say the move could undermine efforts at de-escalation.

It may be noted that India abstained from voting at the IMF Executive Board meeting, reflecting its opposition within the limitations of IMF protocol. Unlike the United Nations, where countries can cast a ‘no’ vote, IMF board members can only vote in favour or abstain — there is no mechanism for a formal rejection.

By choosing to abstain, India signalled strong dissent and used the opportunity to issue a formal objection. In a statement following the vote, the Finance Ministry said the Fund’s processes “lacked moral safeguards,” warning that fungible inflows from multilateral institutions like the IMF could be diverted to fund military or terrorist activities.

The ministry further stated that these concerns were “shared by several member countries,” suggesting broader discomfort within the global community.