The World Bank has pledged full support to help Bangladesh bridge its fiscal gap

The World Bank has assured Bangladesh of comprehensive support—including policy reforms and financial assistance—to help the country navigate its current economic challenges.

Finance Minister Amir Khosru Mahmud Chowdhury expressed optimism on Monday after a high-level meeting with World Bank officials on the sidelines of the IMF-World Bank Spring Meetings in Washington, D.C., marking his first participation in the global lender’s summit in his current role.

Speaking to reporters, the minister said discussions focused extensively on Bangladesh’s current macroeconomic situation. “The economic context of Bangladesh is well understood. We explored in detail how our partnership with the World Bank can be leveraged to address ongoing challenges,” he said, describing the lender’s response as “highly positive” and noting that talks have already moved toward implementation of support measures.

He pointed out that external shocks, particularly global conflicts, have put significant pressure on the national economy. According to him, the World Bank is ready to extend “all-out support” through both policy-based lending and direct project financing to help stabilise the fiscal position.

On the issue of the next tranche of the International Monetary Fund loan, the minister hinted at broader developments. “The release of a tranche is only one part of a specific programme. We are expecting something more substantial and are hopeful of a positive outcome,” he said.

Khosru added that detailed discussions were held on steps to be taken through June to manage the economic situation, expressing confidence that the government would be able to reduce the deficit and restore short-term stability.

Bangladesh signed a $4.7 billion loan agreement with the IMF on 30 January 2023 amid economic strain caused by the COVID-19 pandemic and the Russia-Ukraine war. The programme was later extended by six months in June last year with an additional $800 million, bringing the total to $5.5 billion.

So far, the country has received $3.64 billion in five tranches, leaving $1.86 billion yet to be disbursed. A scheduled tranche last December was withheld pending discussions with an elected government.

A high-level Bangladeshi delegation, led by the finance minister, is currently in Washington, D.C. to attend the Spring Meetings, which began on April 13 and will conclude on April 18.

During the World Bank’s Annual Meetings last October, Bangladesh was under an interim administration led by Muhammad Yunus, when the IMF indicated that no further disbursements would be made ahead of elections.

Following the Bangladesh Nationalist Party’s landslide victory in the 12 February polls, an IMF delegation led by Krishna Srinivasan visited Dhaka in late March, signalling confidence in the new government formed under Tarique Rahman.