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IMF’s 3rd instalment of loan confirmed

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The International Monetary Fund has finally given Bangladesh the green signal for $681 million as the third instalment of the lender’s $4.7 billion loan package.

The visiting delegation of the lender has confirmed that the instalment will be released in June, several top finance ministry officials told the news reporter following a meeting with the IMF team yesterday.

They said various aspects of an agreement for securing the third instalment were finalised in a series of meetings with the IMF and different wings of the finance ministry yesterday.

The lender is likely to reduce the requirement for June’s net foreign exchange reserve from $20.10 billion to $17-$18 billion, they added.

The IMF had a condition for Bangladesh to have reserves of $19.26 billion by March-end and $20.10 billion by June’s end for the third instalment.

An official from the finance division told the news reporter that despite current reserves now around $15 billion, receiving the third instalment is assured even if this condition is not met.

Bangladesh and the IMF do not have much disagreement on most issues, said the official, adding that the government is working to implement the conditions imposed by the IMF including reducing subsidies, increasing revenue and reserves.

He said a new reserves requirement will be finalised in a meeting with the central bank on Tuesday. The IMF will also determine the net reserve target for October and December for the fourth instalment.

Bangladesh also failed to meet the net reserve requirement and revenue target before receiving the second instalment. Back then, the IMF signed the MoU by reducing the targets for next March and June.

Another official said the government also has doubts about achieving the lender’s condition for revenue target for June.

“Therefore, the finance ministry has also sought concessions from the IMF’s targets for June revenue collection. In the new MoU, the IMF is also likely to make concessions in this regard,” said the official.

The government has collected Tk1,62,164 crore against the revised target of Tk1,43,640 crore till last December, according to the finance ministry. However, revenue of Tk3,94,530 crore has to be collected at the end of the financial year.

Assessing revenue collection growth over the current fiscal year’s nine months, the revenue board predicts falling short of the target by at least Tk10,000 crore by June’s end.

Govt actively following IMF’s directives

Ahsan H Mansur, executive director of the Policy Research Institute, told the news reporter that the IMF’s current focus includes transitioning to a market-based exchange rate, leaving interest rates to the market, enhancing revenue collection, and reducing government subsidies.

He said the government is actively aligning policies with the IMF’s directives.

“The IMF may reduce the June net reserve requirement from $20.10 billion to $17-$18 billion. But it will be difficult to achieve before June,” said the economist.

Ramifications of not meeting conditions

Mahbub Ahmed, former senior secretary of the Finance Division, told the new reporter that the government is working to meet IMF conditions to secure the third loan instalment.

He said, “Despite not meeting conditions on foreign exchange reserves or revenue, we remain optimistic about receiving the third tranche.”

He said failing to meet the conditions satisfactorily may hinder receiving the two instalments scheduled for the next fiscal year.

“As the government has until the next fiscal year to fulfil the conditions, the IMF may get strict for the next instalments,” said the former secretary.

He further mentioned that Bangladesh has never received the last instalment of the IMF loan except once due to not being able to fulfil the conditions.

“In 2016, when I was finance secretary, I received the last instalment of the IMF’s $1 billion loan. Before this, Bangladesh could never take the final instalment of the loan,” he added.

Meeting with BB today

The IMF officials will meet with central bank officials on Tuesday morning to adjust banking sector conditions for securing the third and fourth loan instalments.

Later in the day, they will finalise the MoU with State Minister for Finance Waseqa Ayesha Khan and Finance Division Secretary Khairuzzaman Mozumder, attaching the revised terms for releasing the instalments.

The delegation, led by Chris Papageorgiou, head of IMF’s Development Macroeconomics Division, will leave Dhaka after a press briefing on 8 May. The team arrived on 24 April to review the loan programme.

In January last year, Bangladesh signed a $4.7 billion loan agreement with the IMF due to dwindling foreign exchange reserves. The loan is being distributed in seven instalments by 2026. The lender cleared $447.8 million of the first instalment in February last year, and $681 million of the second instalment in December

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Major American Corporations Eye Investments in Bangladesh: State Minister

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State Minister Ahsanul Islam

State Minister for Commerce Ahasanul Islam Titu announced on Tuesday (May 28) that major American conglomerates, including Amazon, Chevron, Coca-Cola, and Boeing, are showing keen interest in investing in Bangladesh.

“We are working to streamline the investment process for American companies, ensuring they can operate smoothly without any obstacles,” State Minister Titu told reporters following a meeting with a delegation from the US-Bangladesh Business Council at the Ministry of Commerce.

The minister highlighted that the discussion focused on simplifying investment procedures and removing any barriers that might deter new American companies from entering the Bangladeshi market.

A representative from Amazon attended the meeting, where discussions centered on the potential for Amazon to integrate Bangladeshi products into its global supply chain and enhance the local e-commerce infrastructure. “Amazon is looking into establishing a central warehouse in Bangladesh to facilitate regional and international product distribution,” Titu added.

The US delegation also explored opportunities in energy, digital payments, and startup sectors.

Titu outlined the primary goals of the United States-Bangladesh Business Council: improving market access for Bangladeshi products, facilitating US investments in Bangladesh, and strengthening bilateral relations. These efforts align with the government’s Smart Bangladesh strategy aimed at strategic growth.

Addressing concerns about some American companies withdrawing their investments from Bangladesh’s capital market, Titu emphasized the importance of welcoming international conglomerates. “If Facebook, Amazon, Chevron, Coca-Cola, and Boeing become involved in Bangladesh’s business landscape, it will significantly ease the country’s progress,” he stated.

Titu also mentioned Bangladesh’s scheduled graduation from the Least Developed Countries (LDC) category in 2026 and stressed the importance of securing market access in various countries within the next two years.

He assured that the government is committed to attracting international investors through policy support, emphasizing Bangladesh’s potential as a significant market with a stable government expected for the next five years.

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Bond Market Reforms Key to Investment Growth: Salman F Rahman

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Prime Minister’s Private Industry and Investment Adviser Salman F Rahman today underscored the need to bolster the country’s capital market to secure funding for investors.

“Globally, the capital market is the primary source for raising finance for investors. However, in our country, businessmen typically rely on bank loans for mid-term investments or expansion. We are working towards improving the bond market,” he stated.

Salman made these remarks following a meeting with an executive business delegation from the US-Bangladesh Business Council at the Bangladesh Investment Development Authority (BIDA) Bhaban in the city, sources said.

The meeting was attended by Board Chair of the US-Bangladesh Business Council and President and CEO of Excelerate Energy, Steven Kobos, along with President of the US-Bangladesh Business Council and South Asian Vice President of the US Chamber of Commerce, Ambassador (ret) Atul Keshap, among others.

Speaking to reporters, Salman mentioned the government’s efforts to safeguard the capital market from manipulation. “Share prices depend on the market. The government never interferes in this regard. The primary role of the government is monitoring,” he added.

He also highlighted the importance of institutional investors in strengthening the country’s capital market.

Moreover, Salman noted that US entrepreneurs have shown increased interest in investing in Bangladesh, recognizing the current government’s various development initiatives.

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PM Sheikh Hasina Seeks U.S. Business Support for ‘Smart Bangladesh’ Vision

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Sheikh Hasina

Prime Minister Sheikh Hasina today called on U.S. businessmen to support Bangladesh’s goal of becoming a developed and smart nation by 2041. Addressing a delegation from the US-Bangladesh Business Council at her official residence in Ganabhaban, she emphasized the importance of their partnership in this transformative journey.

“We aim to become a ‘Smart Nation’ by 2041. Your support in enhancing our global competitiveness and expanding our export base is crucial,” she said.

The Prime Minister highlighted Bangladesh’s imminent graduation from a “least developed” to a “developing” country in 2026, attributing this progress to sustained efforts over the last 15 years. “Our efforts have led to Bangladesh being recognized globally as a ‘Role Model of Socio-Economic Development’,” she stated, citing good governance, the rule of law, rural investment, women’s empowerment, and ICT advancements as key factors.

Sheikh Hasina noted the longstanding economic and developmental partnership with the U.S., which is Bangladesh’s largest export destination and source of foreign direct investment. She expressed optimism about further strengthening this relationship.

“To protect our economy from current pressures, investment—both domestic and foreign—is vital. The implementation of Bida’s One Stop Service (OSS) will facilitate this,” she said, addressing the OSS implementation progress review meeting at the Bangladesh Investment Development Authority’s (Bida) headquarters.

She urged the U.S. business community to invest in Bangladesh’s high-potential sectors, including renewable energy, shipbuilding, pharmaceuticals, and ICT. “We are establishing 100 Special Economic Zones (SEZs) and 28 hi-tech parks, making Bangladesh a prime destination for IT investments,” she added.

Highlighting Bangladesh’s competitive advantages, she mentioned the availability of a young, skilled workforce at competitive wages and the country’s liberal investment policy. She reassured investors of the government’s commitment to improving the investment environment.

In response to the Prime Minister’s address, Bida Executive Member Mohsina Yasmin presented a report on OSS progress, while NBR Chairman Abu Hena Md Rahmatul Muneem assured the business community of considering logical amendments to the Customs Act.

Sheikh Hasina underscored Bangladesh’s significant socio-economic achievements, including reduced poverty rates, increased life expectancy, and higher literacy rates, particularly among women. She noted that Bangladesh is currently one of the world’s fastest-growing economies, projected to be the 25th largest by 2030.

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