B Mirror Report: A high-level delegation from the International Monetary Fund (IMF) is scheduled to visit Dhaka on 9-10 March to meet Prime Minister Tarique Rahman, as Bangladesh aims to keep its multi-billion-dollar loan programme on track and secure a delayed $1.30 billion disbursement.

The three-member team will be led by Krishna Srinivasan, Director of the IMF’s Asia and Pacific Department, according to officials from the Finance Ministry. The IMF had withheld a tranche last December during the interim administration, indicating that further disbursements would follow discussions with an elected government.

Finance ministry officials expressed optimism that if discussions prove productive and the BNP government commits to implementing agreed conditions, Bangladesh could receive the $1.30 billion by June, which would include the pending December tranche and the next scheduled instalment. These funds are expected to help address the government’s budget deficit at a time when revenue collection growth has slowed.

Following a formal letter from the IMF, the Economic Relations Division (ERD) requested a one-hour meeting slot for the prime minister on either 9 or 10 March. The ERD letter dated 23 February noted that the IMF intends to review reform progress under its programme, assess successful completion, and reaffirm ongoing cooperation with the new government.

A senior finance ministry official, speaking anonymously, noted that key IMF conditions—such as revenue mobilisation targets—have yet to be fully met. Other pending requirements include restructuring the National Board of Revenue (NBR), ensuring greater independence for Bangladesh Bank, and fully adopting a market-based exchange rate system.

The official added that the BNP, both in its election manifesto and after forming the government, has pledged to advance economic reforms, establish an Economic Reform Commission, abolish the Financial Institutions Division to strengthen Bangladesh Bank, and continue financial sector reforms. Reducing subsidies while expanding social safety nets remains a major IMF condition, and Finance Minister Amir Khosru Mahmud Chowdhury has already instructed officials to explore subsidy rationalisation measures.

Bangladesh signed a $4.7 billion loan agreement with the IMF on 30 January 2023, amid economic challenges caused by the COVID-19 pandemic and the Russia-Ukraine conflict. The programme includes revenue reforms, banking sector restructuring, and subsidy reduction. In June last year, the IMF extended the programme by six months and added $800 million, bringing the total package to $5.5 billion.

So far, Bangladesh has received $3.64 billion under five tranches, leaving $1.86 billion yet to be disbursed. The IMF had planned to release another tranche last December but deferred it pending discussions with the elected government.

Zahid Hussain, former lead economist at the World Bank’s Dhaka office, said the visit reflects the IMF’s earlier stance that future loan decisions would follow talks with an elected government. He noted that banking and revenue reforms remain incomplete and flagged concerns over exchange rate management.

Towfiqul Islam Khan, additional director (research) at the Centre for Policy Dialogue (CPD), said most IMF reform demands align with BNP’s manifesto. However, banking sector reform, subsidy management, and central bank independence remain significant challenges.

Khan added that while IMF tranches may not be large individually, continued IMF support often encourages other development partners to provide budget assistance. He emphasised the importance of technical support from the Fund and implementation of reforms tailored to Bangladesh’s context.

IMF Delegation to Visit Dhaka Next Month for Talks with PM Tarique Rahman

A high-level delegation from the International Monetary Fund (IMF) is scheduled to visit Dhaka on 9-10 March to meet Prime Minister Tarique Rahman, as Bangladesh aims to keep its multi-billion-dollar loan programme on track and secure a delayed $1.30 billion disbursement.

The three-member team will be led by Krishna Srinivasan, Director of the IMF’s Asia and Pacific Department, according to officials from the Finance Ministry. The IMF had withheld a tranche last December during the interim administration, indicating that further disbursements would follow discussions with an elected government.

Finance ministry officials expressed optimism that if discussions prove productive and the BNP government commits to implementing agreed conditions, Bangladesh could receive the $1.30 billion by June, which would include the pending December tranche and the next scheduled instalment. These funds are expected to help address the government’s budget deficit at a time when revenue collection growth has slowed.

Following a formal letter from the IMF, the Economic Relations Division (ERD) requested a one-hour meeting slot for the prime minister on either 9 or 10 March. The ERD letter dated 23 February noted that the IMF intends to review reform progress under its programme, assess successful completion, and reaffirm ongoing cooperation with the new government.

A senior finance ministry official, speaking anonymously, noted that key IMF conditions—such as revenue mobilisation targets—have yet to be fully met. Other pending requirements include restructuring the National Board of Revenue (NBR), ensuring greater independence for Bangladesh Bank, and fully adopting a market-based exchange rate system.

The official added that the BNP, both in its election manifesto and after forming the government, has pledged to advance economic reforms, establish an Economic Reform Commission, abolish the Financial Institutions Division to strengthen Bangladesh Bank, and continue financial sector reforms. Reducing subsidies while expanding social safety nets remains a major IMF condition, and Finance Minister Amir Khosru Mahmud Chowdhury has already instructed officials to explore subsidy rationalisation measures.

Bangladesh signed a $4.7 billion loan agreement with the IMF on 30 January 2023, amid economic challenges caused by the COVID-19 pandemic and the Russia-Ukraine conflict. The programme includes revenue reforms, banking sector restructuring, and subsidy reduction. In June last year, the IMF extended the programme by six months and added $800 million, bringing the total package to $5.5 billion.

So far, Bangladesh has received $3.64 billion under five tranches, leaving $1.86 billion yet to be disbursed. The IMF had planned to release another tranche last December but deferred it pending discussions with the elected government.

Zahid Hussain, former lead economist at the World Bank’s Dhaka office, said the visit reflects the IMF’s earlier stance that future loan decisions would follow talks with an elected government. He noted that banking and revenue reforms remain incomplete and flagged concerns over exchange rate management.

Towfiqul Islam Khan, additional director (research) at the Centre for Policy Dialogue (CPD), said most IMF reform demands align with BNP’s manifesto. However, banking sector reform, subsidy management, and central bank independence remain significant challenges.

Khan added that while IMF tranches may not be large individually, continued IMF support often encourages other development partners to provide budget assistance. He emphasised the importance of technical support from the Fund and implementation of reforms tailored to Bangladesh’s context.