Out of the three South Asian nations that requested last year despite economic difficulties, Bangladesh is the first to get such money after the International Monetary Fund (IMF) granted loans totaling $4.7 billion for Bangladesh to begin disbursing immediately.
The loans would benefit the nation, which has suffered a steep increase in its current account deficit, depreciation of the taka currency, and a drop in its foreign exchange reserves. They represent a victory for Prime Minister Sheikh Hasina ahead of a general election early next year.
With an immediate distribution of roughly $476 million, Bangladesh will receive about $3.3 billion under the IMF’s extended credit facility and related arrangements. For Bangladesh, the first Asian nation to use it, the IMF Executive Board also approved around $1.4 billion under its recently established Resilience and Sustainability Facility for climate initiatives.
The loans, according to the IMF, will safeguard macroeconomic stability, restore buffers, and support the government’s reform plan.
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Creating budgetary headroom to allow for increased social and developmental investment, bolstering Bangladesh’s financial sector, accelerating fiscal and governance reforms, and increasing climate resilience are all on the agenda.
