TEHRAN -The battle-lines are drawn between Pakistan and the United States once again, this time over the International Monetary Fund (IMF) bailout that Islamabad is likely to seek in coming weeks. The U.S. has warned that it will oppose any IMF bailout that helps China, Pakistan’s new all-weather ally.

On Monday, the U.S. Secretary of State Mike Pompeo was asked in an interview on CNBC about the issue of Chinese loans to Pakistan as part of Beijing’s ambitious ‘Belt and Road’ infrastructure program and if Islamabad approaches the IMF for a bailout. Pompeo, while hoping to engage with Pakistan’s new government, said there was “no rationale” for a bailout that pays off Chinese loans to Pakistan.

“There’s no rationale for IMF tax dollars—and associated with that, American dollars that are part of the IMF funding—for those to go to bail out Chinese bondholders or—or China itself,” Pompeo said. Clearly taken aback by the U.S. official’s statement, Pakistan’s Ministry of Finance said that the “third parties cannot weaken our collective resolve to make CPEC a success story”.

“First and foremost it is totally wrong to link IMF package with CPEC. It is affirmed that Pakistan government is fully committed to undertake and complete CPEC projects in their totality,” the Ministry said in a statement.

The IMF, in a rebuke to the U.S. government, distanced itself from Pompeo’s statement and said that it remained committed to helping Pakistan. “The IMF remains committed to helping Pakistan and its people,” said Teresa Daban Sanchez, the IMF resident representative to Pakistan, while responding to Pompeo’s statement.

The IMF, Sanchez said, is a multilateral international financial institution guided by a strong consensus-based decision-making process in its executive board. She also said that the IMF is closely engaged with Pakistan through Post-Program Monitoring (PPM) and regular Article IV consultations.

China and Pakistan have come closer in recent years with the gargantuan $60 billion China-Pakistan Economic Corridor (CPEC) project, one of Beijing’s undertakings in its Belt and Road Initiative (BRI), under which China has lent billions of dollars in loans and investments to Pakistan.

According to observers, the measures have proved to be inadequate as the country’s reserves have plummeted to $10 billion. Now, the IMF bailout seems imminent.

Pakistani officials have denounced what they say are attempts to drive a wedge between Pakistan and China. “The Americans are trying very hard to put pressure on Pakistan because they have their own interests. But making it so hard for Pakistan to successfully negotiate a new program with the IMF makes no sense. Ultimately, Pakistan will search for other options if the road to the IMF is blocked,” a senior government official was quoted in a Financial Times report.