Does the G-7 really feel India’s terror trauma?

Just 20 days after Pakistan-sponsored terrorists massacred 26 tourists at Pahalgam, the morally and financially bankrupt nation has once again been bailed out by the International Monetary Fund (IMF).

In a disappointing yet expected move, the IMF Executive Board approved a $1-billion loan under its Extended Fund Facility (EFF) Arrangement to Pakistan. This is the second tranche of the $7-bn lending program which is spread over 37 months.

That was not all. As part of its $2.4-bn package, the IMF also approved the request a climate fund of $1.4 billion.

India’s Hands Tied

In the absence of a ‘negative’ vote, the only choice India had was to abstain. Its opposition to the move, especially in light of the escalated military activity in the past 72 hours, was ignored by the IMF. And by the Western world.

In a statement, the Finance Ministry said, “India raised concerns over the efficacy of IMF programmes in case of Pakistan given its poor track record, and also on the possibility of misuse of debt financing funds for state sponsored cross border terrorism. Pakistan has been a prolonged borrower from the IMF, with a very poor track record of implementation and of adherence to the IMF’s program conditions.

The statement also pointed out that Pakistan had been rescued by the IMF 28 times in the 35 years since 1989. Since 2019, four IMF programmes have brought back Pakistan from the financial brink. The Finance Ministry pointed out, “Had the previous programmes succeeded in putting in place a sound macroeconomic policy environment, Pakistan would not have approached the Fund for yet another bailout programme.”

Tacit Approval By G-7 Nations

The G-7 countries – USA, Japan, Germany, France, UK, Italy and Canada were handed the control the Bretton Woods institutions IMF and the World Bank in the post-World War II financial landscape. Today the G-5 (US, Japan, Germany, France and the UK) have 36 per cent vote share in the IMF. Canada and Italy are part of nation groupings which usually vote en-masse.

China has the third largest vote share in the IMF Executive Board decisions – 6.08 per cent. Pakistan is part of group with 2.44 per cent vote weightage.

India is part of a 4-nation group which has a total weightage of 3.05 per cent.

IMF Move Raises Eyebrows

The $2.4-bn fund infusion couldn’t have come at a more opportune time for Pakistan. Like many times before, the country is teetering on the fiscal cliff again. Its bill for the current conflict with India and for its continued steadfast support of terror is running high. The PKR 68,000-crore cheque by IMF gives Pakistan a long leash to unleash more terror.

Questions are being asked. Why did the G-7 turn a blind eye to India’s concerns? India was on a diplomatic overdrive since the massacre in Pahalgam. Why did the IMF Executive Board ignore Pakistan’s terror links and approve not only the $1-bn funding but awarded Islamabad with a $1.4-bn ‘bonus’? And, as in many case earlier, could the IMF have not stepped into more controversy and deferred the vote by a few weeks?

West Ignores Terror?

For most of its global audience, the Pahalgam massacre still remains a ‘militant’ activity, not one linked to terrorists. The reason perhaps, is the biggest ‘opinion influencers’ of the world, the majority of G-7 countries, remain largely untouched by the scourge of terror. Except the U.S.

The United States has experienced the highest terrorism death toll among G-7 nations over the past four decades. From 1979 through April 2024, the United States suffered more than 60 terrorist attacks resulting in nearly 5,500-6,000 deaths.

The biggest, of course, were attacks on September 11, 2001, which alone claimed nearly 3,200 lives.

For the United Kingdom, terror was home-grown. In the pre-2000 era, the UK was severely afflicted by terror attacks arising out of the Northern Ireland conflict (The Troubles). However, in recent years, Islamist extremism has taken over.

The most devastating attack Canada has seen was the 1985 bombing of Air India Flight 182 claimed 329 lives. Perpetrators of this attack, linked to Pakistan, continue to live freely in Canada.

The impact of terrorism on the other G-7 members - France, Germany, Italy and Japan has been miniscule in comparison – possibly the reason why their vote in the IMF was bereft of the deep sentiments India projected.