India is reportedly trying to block Pakistan’s investment in the BRICS bank

India is poised to obstruct Pakistan‘s efforts to secure a 1.1% stake in the Shanghai-based New Development Bank (NDB), as reported by Business Standard on Monday, citing informed sources. New Delhi is anticipated to express its concerns during the forthcoming International Monetary Fund (IMF) meeting.

In February, the Pakistani government sanctioned the purchase of 5,882 shares in the NDB, valued at $582 million, with $116 million designated as paid-in capital.

Pakistani Finance Minister Mohammad Aurangzeb indicated that this initiative would enable Islamabad to broaden its lending avenues and lessen its reliance on the financial frameworks of the World Bank and the IMF.

According to Business Standard, New Delhi plans to address this matter at the IMF meeting, which will assess the $7 billion bailout package provided to the financially troubled South Asian nation in July 2024. In a shift from its typical stance of refraining from commenting on Pakistan’s loan applications at the IMF, India is expected to raise objections regarding the proposed NDB investment, the report suggests.

India is likely to underscore the contradiction in Pakistan’s approach, noting that while it is receiving IMF assistance to avert bankruptcy, it is simultaneously pursuing investments in another financial institution, the NDB. New Delhi is expected to argue that this “doublespeak” is unacceptable, according to the report.

Pakistan has officially expressed its interest in joining BRICS, a coalition originally established by five emerging economies, which includes its competitor India, along with Brazil, Russia, China, and South Africa. Over the past two years, BRICS has welcomed new members such as Egypt, Ethiopia, Iran, the United Arab Emirates (UAE), and Indonesia. Although Saudi Arabia has accepted an invitation to join, it has yet to complete the formalities. Additionally, several other countries, including Bolivia, Cuba, Kazakhstan, Malaysia, Nigeria, Thailand, Uganda, and Uzbekistan, have been granted “partner country” status.

Nonetheless, Pakistan’s bid for membership may face opposition from India, given the ongoing tensions between the two nations.

The New Development Bank (NDB) was established by BRICS in 2015 to meet the financial needs of developing countries, which its members believe are underrepresented in the global financial system. Initially, the founding five members had equal voting rights within the bank; however, these shares were later adjusted to encourage investment from additional countries. Presently, Brazil, Russia, India, China, and South Africa each possess an 18.98% share, while Egypt holds a 2.27% stake, and Bangladesh and the UAE have shares of 1.79% and 1.06%, respectively.