In a move to ease economic pressures in Bangladesh, the International Monetary Fund (IMF) has approved an additional $800 million in loan support. With this, the total loan committed to Bangladesh under the ongoing program has now reached $5.5 billion.
Under the ongoing Extended Credit Facility (ECF), Extended Fund Facility (EFF), and Resilience and Sustainability Facility (RSF), Bangladesh had initially received approval for a $4.7 billion loan package from the IMF in January 2023. The first three tranches were released as scheduled, but the fourth tranche was delayed due to:
-
Falling short of revenue collection targets
-
Delays in implementing a market-based exchange rate
After extensive negotiations and policy commitments, an agreement was reached. As a result, the IMF has approved the release of funds for both the fourth and fifth tranches totaling $1.34 billion, along with the additional $800 million in support.
IMF’s Statement
In its press release, the IMF stated:
“This additional support is intended to help Bangladesh restore macroeconomic stability, accelerate inclusive growth, and strengthen protection for vulnerable populations.”
Bangladesh is currently battling high inflation, foreign currency reserve depletion, and budgetary pressures. Against this backdrop, the added IMF assistance will help the government:
-
Stabilize the monetary system
-
Ease pressure in the foreign exchange market
-
Expand social protection programs
-
Continue essential economic reforms
Former Bangladesh Bank Governor Dr. Atiur Rahman remarked:
“This loan is a relief for the government, but it’s also a test. If used responsibly with proper transparency and reform implementation, it can help the economy recover.”
Read More: Dhaka Metro Rail to Launch Universal Ticketing System for Seamless Fare Payment
Meanwhile, Dr. Fahmida Khatun, Executive Director of the Center for Policy Dialogue (CPD), noted that “Securing the loan is just one part. The real challenge lies in ensuring effective utilization and implementation of the promised reforms.”
Bangladesh first sought IMF assistance in January 2023, receiving approval for a $4.7 billion loan package.
-
1st tranche: February 2023
-
2nd tranche: July 2023
-
3rd tranche: January 2024
-
4th & 5th tranches + $800M additional: June 2025
The program also includes conditions related to green investments, fiscal transparency, and expanding social safety nets.
Bangladesh’s economy is under significant internal and external stress. The IMF’s additional $800 million support comes as a much-needed boost are not only for immediate stability but also as a chance for deeper reform. However, if the government fails to meet its commitments or utilize the funds effectively, this opportunity may turn into another long-term liability.
