1 week ago
IMF Stalls Bangladesh Loan Over Financial and Climate Reforms
Bangladesh is waiting for more money from a loan programme with the International Monetary Fund.
The money has been delayed because the IMF wants Bangladesh to complete several reforms.
These reforms concern banks, taxes, laws, fuel and electricity subsidies, and foreign-exchange rules.
The IMF also wants Bangladesh to improve its ability to prepare for climate change.
Bangladesh is asking for another $2 billion in budget support.
IMF teams have visited Dhaka to review the country’s progress.
Bangladesh has included climate and gender considerations in a new public-finance strategy.
Government officials still hope the remaining loans will be released.
The remaining funds from Bangladesh’s $4.7 billion IMF programme remain stalled, according to a report.
The IMF has reportedly set nearly a dozen conditions involving banking, legal, tax and climate-related reforms.
Requested measures include removing fuel and electricity subsidies and adopting a market-based foreign-exchange rate.
Bangladesh is seeking an additional $2 billion in budget support alongside the programme’s remaining tranches.
The government expects the funds to be released despite difficulties meeting all the conditions, the finance secretary said.
- Who
- The International Monetary Fund and the government of Bangladesh are involved.
- What
- The remaining funds from a $4.7 billion IMF programme have been stalled pending financial-sector, legal, tax and climate-related reforms.
- Where
- Bangladesh, including Dhaka.
- When
- The IMF’s Fiscal Affairs Department delegation recently visited Dhaka, while a technical-assistance mission conducted an evaluation in July; the articles do not provide specific years for these visits.
- Why
- The IMF is seeking completion of pending reforms before reactivating the programme, while Bangladesh is requesting additional budget support.
IMF reform position
Bangladesh government position
Loan release
IMF reform position
The IMF is reportedly keeping the remaining programme funds stalled until Bangladesh completes pending reforms and conditions.
Bangladesh government position
Bangladesh expects the loans to be released despite challenges in meeting all the conditions.
Economic reforms
IMF reform position
The lender is seeking banking-sector and legal reforms, stronger tax administration, removal of fuel and electricity subsidies, and a market-based foreign-exchange rate.
Bangladesh government position
The government has prioritized unfinished reforms and is seeking additional budget support alongside the remaining programme funds.
Climate policy
IMF reform position
The IMF is assessing Bangladesh’s climate policies, financial structures and institutional capacity, with the findings expected to influence future lending discussions.
Bangladesh government position
Bangladesh has introduced climate-smart public financial management and gender-responsive budgeting and allocated 10.09 percent of its FY26 budget allocation to climate-related spending.
Key facts
- Existing IMF programme
- $4.7 billion
- Additional support sought
- $2 billion in budget support
- Reported conditions
- Nearly a dozen reforms and other requirements
- Climate allocation
- Tk 42,206.89 crore across 25 ministries
- Share of FY26 budget allocation
- 10.09 percent for climate-related expenditures
- New reform strategy
- Public Financial Management Reform Strategy 2025-2030
- Reported review areas
- Banking, legal reform, tax administration, subsidies, foreign exchange and climate resilience
Quotes
The Asian Age
Bangladesh-based publication cited as the source of the report
“The incomplete reform activities under the previous loan program with the IMF got priority under the new program. As a result, this visit was not limited solely to assessing climate policies, but also played a crucial role in setting the future direction of economic reforms.”
thehansindia.com
Dr. Md. Khairuzzaman Mozumder
Bangladesh’s finance secretary
“We hope that the IMF will consider different difficulties of Bangladesh to meet cent percent of the loan conditions. Despite some challenges, we are expecting the loans will be released in favour of Bangladesh.”
thehansindia.com
Sources
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