IMF Approves $1 Billion for Pakistan Amid Rising Tensions with India

ISLAMABAD, Pakistan — The International Monetary Fund (IMF) executive board approved the first review of its $7 billion program with Pakistan on May 9, 2025, releasing $1 billion in cash, according to the Pakistani government.

Prime Minister Muhammad Shehbaz Sharif expressed satisfaction with the approval, stating in an official release, ‘This tranche will aid in stabilizing our economy during challenging times.’ The IMF’s board was also set to discuss a new sustainability loan of $1.3 billion intended to support Pakistan over the next two years.

The approval occurs against a backdrop of heightened tensions between Pakistan and India. Recently, India requested the IMF to reassess its loans to Pakistan following an April attack on Hindu tourists in Indian-administered Kashmir, which resulted in 26 fatalities and sparked the most severe fighting between the two nations in nearly three decades.

While the staff-level agreement on the $7 billion program and the sustainability loan was established prior to the escalation of hostilities, the situation remains delicate. On the same day of the IMF approval, both nations accused each other of initiating drone and artillery strikes, as tourists and local villagers were forced to flee due to the fighting.

With this latest approval, disbursements under the $7 billion program now total $2 billion. The IMF did not immediately provide further comment.