India to push FATF, World Bank, IMF to take positions in Pakistan conflict

India is set to push the Financial Action Task Force (FATF), a global financial crime watchdog, to add arch-rival Pakistan back to its “grey list” and oppose upcoming World Bank funding to Islamabad.

The neighbors with nuclear weapons have fought the worst war in almost 30 years this month before agreeing to end the battle on May 10. It has been a tit for tat game. Indian forces fired several missiles into Pakistani land after midnight on May 7, killing at least 31 people and hurting 26 more.

In response, on May 9, Pakistan said it had killed “40 to 50 Indian soldiers” along the border in response to India’s attack on May 7.

For this, India has revealed a number of actions to punish what it calls Pakistan-backed terrorist attacks on its territory. The most recent attack killed 26 Hindu tourists in the Kashmir valley last month. This includes keeping a critical water treaty in abeyance.

On the other hand, Pakistan has said that it had nothing to do with the attack in Kashmir and that India’s decision not to follow through on the Indus Waters Treaty is an act of war.

⚡ India is intensifying its efforts to financially isolate Pakistan, contesting World Bank loans and urging the FATF to reinstate it on the grey list. pic.twitter.com/n4KbSlDMQH

— OSINT Updates (@OsintUpdates) May 23, 2025

India has promised not to miss any chance to protest against Pakistan. “The next one is funding by the World Bank, and we will raise our protest there too,” the source said. Also, Narendra Modi, the prime minister of India, said that Pakistan, its army, and its economy will have to pay a heavy price for every terrorist attack.

India’s actions to drag Pakistan back to the “grey list”

Pakistan was taken off the FATF grey list in 2022. This gave it a clean bill of health when it comes to funding terrorism and improved its image with lenders, which was very important for Pakistan’s economy, which was in a crisis.

When a country is put on the FATF’s “grey list,” it is closely watched until it fixes problems in its financial system. A person in the Indian government said that Pakistan had not met the requirements to be taken off the “grey list,” so it should be put back on it.

According to reports, India also told the IMF that Pakistan bought more weapons every time it got a loan from the IMF. Last year, the IMF gave Pakistan a $7 billion bailout program. This month, the IMF gave Pakistan another $1.4 billion through a climate resiliency fund.

China and the US refuse to pick a side

The UN asked the neighbors with nuclear weapons to be very careful with their war actions. The US, China, and UAE also asked for things to calm down. In fact, earlier in the month, US Vice President JD Vance said that Washington hoped Pakistan would cooperate with India to hunt down Pakistan-based assailants.

However, China has had disagreements with both Pakistan and India in the past about other parts of Kashmir. It made a deal with Pakistan in 1963 to set the border between the two countries. However, India doesn’t believe that deal is still true and is still fighting China’s claims to part of eastern Kashmir.

China now has the most money spent in Pakistan. Since 2015, $62 billion has been put into the China-Pakistan Economic Corridor. However, in the past few months, Beijing has been trying to improve its relationship with New Delhi. 

On the other hand, the US has been building its relationship with the country for years to counter China’s influence in the area. 

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