The letter called Pakistan as “high risk” jurisdiction from a weapon financing perspective and quoted Indian investigations into weapon financing, but did not go into detail about their findings | Photocredit: Reuters/Francis Mascarenhas
The Reserve Bank of India (RBI) has asked the lenders of the country to increase the investigation about funds that indirectly flow from Pakistan, according to a letter that is seen by Reuters This called a “high risk” that such money is used to buy weapons.
Direct fund flows from Pakistan to India are largely prohibited with every transaction that requires the approval of the central bank.
The directive, dated August 6, follows research by Indian agencies after India and Pakistan had applied a bright four -day military conflict in May.
It called Pakistan as a ‘high risk’ jurisdiction from a weapon financing perspective and quoted Indian investigations into weapons financing, but did not go into detail about their findings.
According to a government source with direct knowledge of the case, the Indian research agencies discovered that some Pakistani nationals had sent money to India via other countries. The banking channels of India run a “high risk” to be used by Pakistan for arms financing, said that the source that was not authorized to speak with the media and refused to be identified.
The Central Bank has general guidelines for banks to prevent money laundering and the financing of weapons and terrorism, but a guideline that draws attention to Pakistan is rare.
The Reserve Bank of India did not respond to one Reuters‘Request for comments.
Zafar Masud, president of the Pakistan Banks Association, said in a statement that “Pakistan’s anti-money laundering laws and the fight against the financing of terrorism are very strict and robust.”
The RBI letter to banks and non-banking lenders also quoted separately cases in which Pakistan has been accused of violating worldwide sanctions and rules.
It noted that a report of June 2025 had accused a Pakistan state company, the National Development Complex, of avoiding sanctions by importing items for rocket development without explaining them.
The Ministry of Foreign Affairs of Pakistan did not respond to one Reuters Request for comments.
The letter also stated Noord -Korea as a: high risk “jurisdiction, with reference to sanctions imposed by the United Nations Security Council in the country in the past.
Published August 26, 2025
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