What is the IMF, and how does it help countries in crisis?

The IMF, or International Monetary Fund, is a global financial body that lends money to countries facing a balance of payments crisis, which simply means they are running out of foreign currency to pay for imports and debts.

It was set up in 1944, along with the World Bank, and today has 191 member countries. Members contribute money based on the size of their economies, and voting power roughly follows those contributions, which is why the US has the biggest say.

When a country is in serious trouble, the IMF can provide an emergency loan, often called a bailout. In return, it usually asks the government to make reforms, such as cutting subsidies, raising taxes or controlling spending. Sri Lanka in 2022–23 and Pakistan in recent years are good examples from India’s neighbourhood. India itself took IMF help in 1991, during the crisis that led to its economic reforms.

Supporters say the IMF prevents economic collapse and restores confidence. Critics argue its conditions can be harsh on ordinary people and that developing countries do not have enough say in how it is run, a common complaint across the Global South.