India is also reportedly likely to oppose the upcoming World Bank funding for Pakistan
India is expected to approach the Financial Action Task Force to add Pakistan to its grey list during the global body’s next meeting, Reuters reported, citing a top government source.
The ‘grey list’ of the FATF accounts for jurisdictions that are under increased monitoring. When a country is placed under this list, it means that it has “committed to resolve swiftly the identified strategic deficiencies within agreed timeframes and is subject to increased monitoring”. At present, as many as 25 countries are listed under FATF’s “jurisdictions under increased monitoring”, i.e., “grey list”.
In 2022, Pakistan was taken off the FATF grey list, boosting the country’s reputation among its lenders, a position necessary for a crisis-hit economy.
The source reportedly also said that India will oppose the upcoming World Bank funding for Pakistan.
The move comes in the backdrop of the recently heightened tensions between the two nuclear-armed neighbours.
Meanwhile, the International Monetary Fund (IMF) justified its $1 billion bailout to Pakistan and said that Islamabad “met all the required targets” to receive the latest loan instalment.
Under the Extended Fund Facility programme, which was approved in September 2024, Pakistan has received around $2.1 billion.
However, amid tensions with India, the IMF gave 11 new conditions to Pakistan to receive the loan. These conditions reportedly included parliamentary approval, increase in debt servicing surcharge in electricity and lifting restrictions on imports, among others.
India had asked the IMF to reconsider its bailout package to Pakistan, saying that the money was being used to fund cross-border terrorism.
Earlier, Defence minister Rajnath Singh had also said that IMF aid to Pakistan was a “form of indirect funding to terror”.
As per Reuters report, the government source also said that New Delhi told IMF that Pakistan arms purchase witnesses a spike everytime it provides the nation with a loan.
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