Bangladesh has formally requested an extra $750 million from the International Monetary Fund (IMF) to alleviate its economic challenges and address foreign exchange shortages.
In a statement issued on Wednesday, the IMF announced that a staff-level agreement has been made to release a fourth tranche of $645 million as part of the ongoing $4.7 billion loan program. If approved, the additional loan will bring Bangladesh’s total financial assistance from the IMF to $5.3 billion.
Alongside this request, the IMF has revised its economic growth forecast for Bangladesh downward, while keeping its inflation projections high for the 2024-25 fiscal year. The IMF now expects Bangladesh’s economy to grow by 3.8% in FY25, a reduction from its earlier October projection of 4.5%. This downward revision is attributed to economic setbacks caused by the July public unrest, flooding, and tighter policies.
The IMF’s updated forecast is even more conservative than the World Bank’s projection, which estimated a 4% GDP growth for Bangladesh in October.
A delegation from the IMF, led by Chris Papageorgiou, head of Development Macroeconomics at the IMF Research Department, is currently in Dhaka to assess progress on the IMF’s conditions and negotiate new loans before the release of the fourth tranche. The team will hold a press briefing on Thursday.
Sources suggest that the IMF is open to providing Bangladesh with the requested $750 million under stricter terms, outside the current loan package.
Outlook Revision
In its statement, the IMF also projected a rebound in Bangladesh’s GDP growth to 6.7% in FY26, anticipating economic recovery as policies loosen.
This marks the second time this year that the IMF has downgraded Bangladesh’s growth forecast while raising its inflation expectations since July. The IMF’s revised outlook comes just days after Bangladesh Bank Governor Ahsan H. Mansur announced that the interim government aims to reduce consumer prices to 7% by June next year—an ambitious goal that analysts remain skeptical about due to persistently high inflation.
