'Bangladesh seeks $1.5bn in loans from IMF in first payment'

Bangladesh is seeking $1.5 billion in an initial loan instalment from the International Monetary Fund, The Financial Times reports.

In an interview with the London-based newspaper on Tuesday, Finance Minister AHM Mustafa Kamal says that the country wants a total of $4.5 billion in loans from the IMF, including for climate change resilience projects and to shore up the government’s budget, but the final amount is still being negotiated.

Bangladesh is looking for an additional $4 billion from the World Bank, Asian Development Bank, Asian Infrastructure Investment Bank and the Japan International Cooperation Agency and is optimistic about securing the loans, the finance minister said.

The country’s efforts to secure external funding have come amid the economic hit from the coronavirus pandemic, and the surge in fuel and food prices due to the Russia-Ukraine war.

Many countries, such as Sri Lanka and Pakistan, are in talks for emergency funding from the IMF. Sri Lanka is still negotiating, while Pakistan reached an initial deal in July for the IMF to release $1.3 billion of an existing $7 billion assistance package.

Bangladesh is facing a steep and rising energy import bill and fuel shortages have forced the government to institute nationwide power outages, raise fuel prices and put restrictions on fuel sales.

“Everybody is suffering and we’re also under pressure,” Kamal told the Financial Times.