Pakistan, May 5 -- Global credit ratings Moody's has warned that rising tensions between India and Pakistan may threaten Pakistan's fragile economic recovery. The expressed concern that further escalation could disrupt access to foreign funding and reverse progress made under the International Monetary Fund (IMF) programme.

In a note issued Monday, Moody's acknowledged recent improvements in Pakistan's economy. Inflation has eased, growth has slowly returned, and foreign reserves have increased under IMF guidance. However, the stated that these gains are now at risk due to heightened geopolitical instability following the April 22 Kashmir attack, which left 26 people dead. India blamed cross-border elements, a claim Pakistan denies.

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