Kamal seeks additional assistance from ADB
Just a day after parliament passed the budget, Finance Minister AHM Mustafa Kamal yesterday sought an additional assistance from Asian Development Bank (ADB) as the government looks to use a record amount in foreign aid in fiscal 2021-22.
The development came about when as Kamal virtually met Shixin Chen, the vice president for operations 1 of the ADB.
"Additional support has been sought to address the economic challenges posed by the pandemic and to continue development activities," a finance ministry official told The Daily Star.
The official said the ADB informed the government of its financial plan for a calendar year and for 2021 it has a plan to provide Bangladesh $3.5 billion.
"Loan agreements for $1.2 billion have already been signed," he said, adding, "The assistance Bangladesh sought in the meeting is beyond the ADB's calendar year-based plan."
In June this year, the ADB supported Bangladesh's Covid-19 response through a $250 million loan to strengthen social protection and resilience programmes and $940 million in loan assistance for the purchase of vaccines.
The ADB has been cooperating with Bangladesh from the very beginning to restore the social and economic security overcoming the pandemic. "We will always be by the side of Bangladesh in the future," said Chen in the meeting.
Kamal stressed on the need to continue such cooperation between Bangladesh and the ADB in the future to achieve development goals.
The government is hoping to use a record Tk 115,000 crore (about $13 billion) in foreign funding in fiscal 2021-22, up 35.4 per cent year-on-year to overcome the challenges brought on by the pandemic.
The government is sitting on a record amount of foreign aid and at the same time, the development partners are chipping in liberally to help Bangladesh weather the pandemic tempest.
Closer to home, banks are sitting on excess liquidity and nowhere to lend given the precarious state of the economy.
At present, about $50.4 billion of foreign aid is present in the pipeline, while World Bank, the Asian Development Bank and other development partners have expressed their intent to provide budgetary support to the Bangladesh economy to better manage the pandemic whirlwind.
The ADB also has provided $500 million budget assistance in May 2020, $100 million assistance to the health sector in a project titled Covid-19 Response Emergency Assistance in April 2021, and $9.3 million grant for Bangladesh in response to Covid-19.
Manmohan Parkash, ADB country director for Bangladesh; Abdur Rouf Talukder, finance secretary, and Fatima Yasmin, secretary to the Economic Relations Division, were present.
Bangladesh could get New Development Bank membership
The negotiation for Bangladesh to get membership of New Development Bank established by the BRICS states could start from July 15 and Bangladesh could get the membership of the multilateral development bank by 2022.
The development comes as the finance minister met Marcos Troyjo, president of New Development Bank, about getting Bangladesh a membership of New Development Bank in a separate virtual meeting.
Bangladesh is trying to get 1 per cent stake in New Development Bank and negotiations are going on about how much Bangladesh has to pay as subscripting fees for the membership, according to a finance ministry official.
The BRICS states—Brazil, Russia, India, China and South Africa— established New Development Bank to provide support in various development sectors.
Kamal said Bangladesh's membership in New Development Bank would be beneficial for both. The funding of New Development Bank will play an important role in making development sustainable and making Bangladesh a happy and prosperous country by 2041.
Troyjo assured all cooperation to expedite the process of awarding Bangladesh the membership of New Development Bank.