India Flags Concerns Over $800 Million ADB Aid To Pakistan Amid Rising Defence Spending

India has raised serious concerns about the $800 million ADB aid to Pakistan, warning that the funds may be misused for defence spending instead of economic reforms.

Officials pointed out that Pakistan’s army has taken de facto control over the civilian government. It now leads the Special Investment Facilitation Council, which influences economic policy directly.

Sources said the military’s deep role in governance threatens economic stability. They added that this structure risks reversing reforms and weakening policy execution.

Despite Pakistan’s dire financial condition—plummeting forex reserves, double-digit inflation, and a falling tax-GDP ratio—the defence budget has increased.

India has questioned Pakistan’s history of implementing reform-linked conditions tied to aid from multilateral lenders. It warned that the ADB aid to Pakistan could be diverted towards military use, especially after the recent induction of Chinese fighter jets and an influx of drones amid Operation Sindoor.

India cited Pakistan’s repeated appeals to the IMF, including a 24th bailout request, as evidence of failed reform and policy execution.

New Delhi said these past failures make fresh financial support highly questionable.

Security Implications & FATF Concerns

India also criticised Pakistan’s support for cross-border terrorism, saying it worsens regional security. It called Islamabad’s compliance with FATF’s anti-terror financing guidelines unsatisfactory.

Specifically, it highlighted poor prosecution of UN-designated terror group leaders and weak action on asset seizures.

India’s concerns underline the risks of supporting a military-dominated government with a record of reform failures and aggressive regional behaviour.

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