IMF team to visit Dhaka in April

Bangladesh will receive a $2.39 billion tranche from the International Monetary Fund (IMF) under the ongoing $4.7 billion loan programme. An IMF delegation will visit Dhaka this April to review various conditions before the disbursement.

This is the second visit by a major IMF team to Dhaka since the interim government led by Dr. Muhammad Yunus took office on August 8.

According to the Finance Department of the Ministry of Finance, an IMF team will visit Dhaka on April 5 to review the progress of fulfilling various conditions before the disbursement of the fourth and fifth tranches of the loan. The team will hold meetings with various government departments for two consecutive weeks starting April 6. During this visit, the IMF team is scheduled to meet with the Finance Department, National Board of Revenue (NBR), Power Department, Power Development Board, Bangladesh Energy Regulatory Commission (BERC), and Energy and Mineral Resources Department. After the meeting, the visiting IMF team will hold a press briefing on April 17. The group will meet with Finance Adviser Salehuddin Ahmed on the first day and Finance Adviser Salehuddin Ahmed on the last day.

The loan programme with the IMF began on January 30, 2023. After that, Bangladesh received three tranches of money. The first tranche of $476.3 million was received from the IMF on February 2, 2023. In December of the same year, it received the second tranche of $681 million. And in June 2024, it received the third tranche of $1.15 billion. Bangladesh received about $2.31 billion in three tranches. The loan disbursement is $2.39 billion. The problem arose before the fourth tranche was released. Although the government hopes that the fourth and fifth tranches will be received together next June.

Meanwhile, in a recent pre-budget discussion with the economic journalists' organization ERF, Finance Adviser Dr. Salehuddin Ahmed said that the IMF loan will be needed for budget support. That is why the Bangladesh government and the IMF have jointly agreed to release two installments scheduled for the 2024-25 fiscal year together.

Those concerned say that Bangladesh has three major obstacles to receive the two installments of the IMF loan together. These are making the currency exchange rate market-based, collecting additional revenue at the rate of 0.5 percent of the gross domestic product (GDP), and separating the revenue administration from the NBR's revenue policy.

Bangladesh has informed the IMF that these conditions will be implemented. However, according to sources in the Bangladesh Bank and the Ministry of Finance, there is not much progress on the remaining two except for the step of separating the revenue administration from the revenue policy.

However, the exchange rate is being determined using the crawling peg method. Due to which there is no chance of the dollar's price suddenly increasing too much. In this method, the dollar price is stable at Tk 122.