IMF Refuses to Release Sixth Loan Installment to Bangladesh Ahead of Elections

Staff Reporter | PNN

The International Monetary Fund (IMF) is unwilling to immediately release the sixth installment of its loan to Bangladesh, advising the country to wait until after the elections. According to sources citing the organization, the installment will only be disbursed if the newly elected government pledges to continue the ongoing economic reform program following discussions.

Bangladesh was scheduled to receive approximately $800 million in the sixth installment. However, the IMF has expressed reluctance to release the funds ahead of the elections due to uncertainties regarding the policy stance of the new government and the continuity of the reform program.

During the recent IMF and World Bank annual meetings in Washington, a message to this effect was delivered in a meeting with Bangladesh’s Governor, Dr. Ahsan H. Mansur. The Governor stated that although the installment was scheduled for release in December, the IMF is not willing to release it before the elections. He added, “The reserve situation is stable, and the dollar is steady. IMF support is important, but the country can function without their funds.”

Economic advisor Dr. Salehuddin Ahmed commented, “If the IMF imposes strict conditions, Bangladesh will not comply. The country is no longer in a crisis like before.”

Analysts believe that with elections approaching, the IMF is exerting pressure to enforce conditions, sending a signal to the global market that Bangladesh is not meeting the required commitments. The organization plans to secure assurances from the new government before releasing the funds.

An IMF delegation is scheduled to arrive in Dhaka on October 29 to review the conditions for the sixth installment. Over two weeks, the team will meet with various government agencies and submit an evaluation report to the central office. This report will play a critical role in the decision to release the loan.

Currently, Bangladesh’s foreign currency reserves stand at $32.14 billion. Positive trends have been observed in remittances and exports, while import expenditures are under control.

It is noteworthy that amid global economic pressures in 2022, the Bangladeshi government sought assistance from the IMF. In January 2023, the IMF approved a loan of $4.7 billion, later increased to $5.5 billion. So far, Bangladesh has received $3.6 billion in five installments.