Won't have any impact but expect it to be rolled back: Pak on India's Indus move

Pakistan's Finance Minister Muhammad Aurangzeb has expressed hope that the suspended Indus Waters Treaty between India and Pakistan will be reinstated and "rolled back" to its original framework. In an interview with Reuters, Aurangzeb said there is no immediate impact from India's suspension of the treaty and that Pakistan does not even want to consider any scenario that does not involve the agreement's reinstatement.

The landmark 1960 treaty, brokered by the World Bank, governs the sharing of water from the Indus River system between the two countries. India had announced the suspension of the treaty earlier this month as part of its response to the April 22 Pahalgam terror attack that killed 26 civilians.

Prime Minister Narendra Modi, in his first public address on Operation Sindoor, said that "terror and trade cannot go hand in hand".

PM Modi, while speaking about the Indus Waters Treaty, which India suspended as part of its diplomatic strike in response to the Pahalgam terror attack, said "water and blood can't flow together".

"Terror and trade cannot go together, water and blood cannot flow together," PM Modi said on Monday during an address to the nation.

In the interview, Aurangzeb described the recent military escalation between the two nations as a "short-duration escalation" with minimal fiscal impact.

He said it can be "accommodated within the fiscal space which is available to the government of Pakistan". He declined to discuss whether military spending would increase in the upcoming budget, stating it was premature, but added that all necessary defence requirements would be met.

Aurangzeb also said Pakistan's trade talks with the United States - which apparently played a key role in mediating a ceasefire - would likely progress in "short order". He noted that Pakistan could soon import more high-quality cotton and soybeans from the US, and was also exploring hydrocarbons and other asset classes.

The Finance Minister confirmed that Islamabad will receive a USD 1 billion disbursement from the Monetary Fund on Tuesday as part of a USD 7 billion bailout program. Additionally, the IMF board has approved a new USD 1.4 billion loan under its climate resilience facility. Pakistan's federal budget for the upcoming fiscal year, starting in July, will be finalised in three to four weeks, with budget talks scheduled with the IMF from May 14 to 23.

Meanwhile, US President Donald Trump claimed on Monday that his administration brokered a full and immediate ceasefire between India and Pakistan, asserting that trade incentives were a key factor in de-escalating tensions. However, government sources in India said there were no trade discussions during recent high-level conversations between Indian and US officials.

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