IMF denies Pakistan using funds for military operations against India and firmly clarifies all the concerns raised by Indian media. IMF (International Monetary Fund) Communicative Director Julia Kozack said during the press briefings that all funds that are disbursed under the EFF (Extended Fund Facility) are directly transferred to the Central Bank of Pakistan, not to the government for “budgetary spending.”
“IMF financing is provided to resolve balance of payments issues and is not intended for military use,” she added, noting that the program contains strict safeguards to ensure compliance, including restrictions on the central bank providing money to the governments, targets for reserve accumulation and comprehensive structural reform policies such as marketing functioning. Additionally, she warned that any violation of these safeguards could jeopardize future disbursements.
While India has raised objections to Pakistan’s possible use of IMF resources for reconstruction in areas allegedly involved in cross-border terrorism. The IMF made it clear that such use would be outside the scope of its lending program and is effectively blocked by bailout constraints.
Moreover, Julie Kozack also spoke about other geographical tensions and expressed condolence for the loss of human lives during the recent escalation between India and Pakistan. She hoped for a peaceful resolution.
Kozack also explained the detailing timeline of IMF’s involvement with Pakistan. She said that the program was approved in September 2024 by the Executive Board and the first review of the staff-level agreement was made in March 2025. And lastly, the board formally approved the review on 9th May 2025, paving the way for the disbursement.
She also mentioned that the Executive Board prioritized agreement over formal voting records. That’s why all decisions regarding governance are made by consensus. In this case, sufficient consensus for Board approved the review for Pakistan.
Lastly, she was asked about the recent departure of Indian Executive Director K.V. Subramanian at the IMF. Kozack answered that the appointments of Execitive Directors are solely a matter for the country’s members, not the purview of the funds.
