The International Monetary Fund (IMF) has decided to release the second installment of the loan waiver for Bangladesh. In a meeting of the organization’s Executive Board held on Tuesday (December 12) in Washington, DC, approval was given for the waiver of $682 million for the second installment. The equivalent amount in Bangladeshi currency is approximately Tk 7,000 crore. Finance Minister AHM Mustafa Kamal confirmed this information. The IMF approved a loan of $470 million for Bangladesh to tackle the economic crisis in January of the previous year.
At the beginning of February, a waiver of $476.3 million was given for the first installment. It is stated that the entire loan will be received in 42 months. The average interest rate on the loan is 2.2 percent. There are two types of loans in the adjustable package. Assistance from the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) will be available for $330 million. Under the Resilience and Sustainability Facility (RSF), $140 million will be available.
Until 2026, during the implementation of this loan program, various conditions related to policy reform and structural programs must be implemented in Bangladesh. In the second installment of the loan, an amount of $463 million and $300,000 will be released under the ECF and EFF, respectively, and $219 million and $900,000 under the RSF. Due to uncertainties in achieving revenue collection based on June and foreign currency reserves, there was initial uncertainty about the waiver of the second installment. However, during the IMF mission to Dhaka in October, the government was able to explain why it did not comply with these two conditions.
Apart from this, due to progress in the reform program, the IMF mission informed in a statement on October 19 that the first review of the conditions for the loan waiver had reached a consensus with the Bangladesh government. After completing the first review, Bangladesh will receive the second installment of the loan. However, the IMF Executive Board will make the final decision on this matter. According to sources at the Ministry of Finance, at the end of June, the country had a net reserve of $24.46 billion in foreign currency.
However, at that time, the reserve was $20.47 billion. Now, the waiver of the third installment of the loan will depend on progress based on December. At the end of December, the new target amount for net reserves could be $17 billion. In the last fiscal year, the National Board of Revenue (NBR) set a revenue collection target of Tk 3,45,600 crore. However, by the end of the year, NBR was Tk 6,000 crore behind the target. The revenue collection target has been set at Tk 4,01,000 crore for the next fiscal year.
