India has asked the International Monetary Fund (IMF) to review the loans given to Pakistan, as tensions between the two countries rise following a deadly attack in Kashmir. According to an Indian government source, the request was made after an attack on Hindu tourists in Indian Kashmir, which resulted in the deaths of 26 people. The situation has led to concerns that the conflict between the two nuclear-armed neighbours could escalate into a military confrontation.

New Delhi has identified three attackers, two of whom it claims are Pakistani nationals, and labelled them as "terrorists." However, Islamabad has denied any involvement and called for an impartial investigation into the matter. India has halted a key river water-sharing agreement, and both countries have closed their airspace to each other's airlines. Last year, Pakistan received a $7 billion bailout from the IMF, and in March, it was granted a new $1.3 billion loan aimed at boosting climate resilience. The program is crucial to Pakistan's $350 billion economy, and the country has stated that it has stabilised with the help of a bailout that prevented a default.

India, however, raised concerns with the IMF about its loans to Pakistan, requesting a review, according to a government source. No further details were provided. Both the IMF and India's finance ministry have yet to respond to requests for comment. The advisor to Pakistan's finance minister mentioned that the IMF program is progressing as planned. Advisor Khurram Schehzad told Reuters that Pakistan had very fruitful spring discussions with financial institutions in Washington, saying, "The latest review has been done well and we are completely on track."

"We did about 70 meetings ... interest has been very high for investing and supporting Pakistan as the economy turns around," Schehzad said. Tensions between the two countries have sparked global concern, with many calling for de-escalation. On Thursday, US Vice President JD Vance expressed hope that Pakistan would work with India to track down the attackers based in Pakistan.

Jammu and Kashmir has signed an accession treaty with India, and Pakistan continues to control parts of it. India has accused Pakistan of supporting insurgents in Indian-administered Kashmir, while Pakistan maintains that it only provides moral and diplomatic support to Kashmiris seeking self-determination.