India asks IMF to review loans to Pakistan, Indian government source says

WASHINGTON: US Vice President JD Vance said on Thursday Washington hoped Pakistan would cooperate with India to hunt down Pakistan-based militants, and that India’s response to the recent Islamist militant attack in India-administered Kashmir does not lead to a broader regional conflict.
“Our hope here is that India responds to this terrorist attack in a way that doesn’t lead to a broader regional conflict,” Vance said in an interview on Fox News’ “Special Report with Bret Baier” show.
“And we hope, frankly, that Pakistan, to the extent that they’re responsible, cooperates with India to make sure that the terrorists sometimes operating in their territory are hunted down and dealt with,” Vance added.
Vance’s comments are the closest the US government has come since the April 22 attack — in which 26 people were killed — to potentially linking Pakistan to extremism in India.
Top US leaders, including President Donald Trump, have condemned the attack, calling it “terror” and “unconscionable,” while expressing support for India without directly blaming Pakistan.
India is an important US partner as Washington aims to counter China’s rising influence. Pakistan remains Washington’s ally even as its importance diminished after the 2021 US withdrawal from neighboring Afghanistan.
In recent days, Washington urged India and Pakistan to work with each other to de-escalate tensions and arrive at a “responsible solution.”
India has blamed Pakistan for the attack. Islamabad denies responsibility and is calling for a neutral probe.
The US State Department has said it was in touch with the nuclear-armed Asian neighbors at multiple levels and Secretary of State Marco Rubio held calls on Wednesday with Indian Foreign Minister Subrahmanyam Jaishankar and Pakistani Prime Minister Shehbaz Sharif.
Hindu nationalist Indian Prime Minister Narendra Modi vowed to punish those responsible and Jaishankar has told Rubio that the perpetrators should be brought to justice. Pakistan says military action by India was imminent.
Muslim-majority Kashmir is claimed in full by both Hindu-majority India and Islamic Pakistan, with each controlling only part of it and having fought wars over it.
After the attack, India suspended a treaty regulating water-sharing, and both countries closed airspace to each other’s airlines. They also exchanged fire across their border.

ISLAMABAD: The Pakistan Stock Exchange (PSX) bounced back strongly on Friday as investor confidence returned amid calls from the United States and the United Nations for de-escalation of India-Pakistan tensions over Kashmir, traders and analysts said, with the market gaining more than 2,500 points during the intraday trade.
Relations between the neighbors have plummeted after India accused Pakistan of backing an attack in Kashmir that killed 26 tourists on April 22. Islamabad denies the accusation.
The benchmark KSE-100 index gained 2,787.36 points, or 2.5 percent and closed at 114,113.93 on Friday, compared to the previous day’s close of 111,326.57 points.
Stock analysts attributed the bullish sentiment to calls from the UN, US and other countries to de-escalate tensions between the two countries and offers to mediate the crisis.
“Stocks showed sharp recovery after the US and the UN urged Pakistan and India to defuse tensions,” Ahsan Mehanti, CEO of Arif Habib Group, told Arab News.
“Reports of 0.3 percent year-on-year Consumer Price Index (CPI) inflation for April 25 likely to further ease SBP [State Bank of Pakistan] policy and expected receipt of IMF tranche [of $1 billion] this month played catalyst role in record bullish activity at PSX.”
Pakistan is currently navigating an economic recovery program under a $7 billion International Monetary Fund (IMF) program.
But tensions with India over Kashmir saw the Pakistani stock market shedding over 3,500 points on Wednesday. The US State Department said it was in contact with India and Pakistan, while State Secretary Marco Rubio on Wednesday held telephonic conversations with Prime Minister Shehbaz Sharif and Indian Foreign Minister Subrahmanyam Jaishankar in a bid to ease tensions.
The UN has urged the arch-rivals to talk, while China, which shares its border with both India and Pakistan, this week repeated its call on both sides to “exercise restraint.”
Saudi Arabia has said Riyadh is trying to “prevent an escalation,” while Iran has offered to mediate the crisis.
“The developments over the weekend are likely to be closely watched and will dictate whether today’s bounce spills over into next week also,” Raza Jafri, head of research at Intermarket Securities, told Arab News.