IMF approves $681m in 2nd tranche of loan for Bangladesh

The IMF board yesterday approved the second instalment of $681 million for Bangladesh, putting to bed the uncertainty surrounding the tranche given that the country failed to meet two of the conditions needed for its release.

The development, which was confirmed to The Daily Star by Finance Minister AHM Mustafa Kamal, will go some way towards easing the jitters surrounding the Bangladesh economy in the face of depleting foreign currency reserves and elevated inflation.

The $681 million will be disbursed soon and is expected to cover import bills of about 15 days.

One of the unmet preconditions was to maintain a minimum net international reserve (NIR) of $24.46 billion by the end of June.

The NIR target was missed by about $3 billion as the government had to delve into reserves to pay for essential imports of fuel, fertiliser, and foodstuff.

The minimum tax revenue target was also missed: the government needed to collect at least Tk 345,630 crore in tax revenue in fiscal 2022-23.

It finally raised Tk 327,664 crore, which fell Tk 17,946 crore short of the goal, according to a finance division report.