Dhaka seeks $8b from IMF, World Bank and ADB
With west backed economist Muhammad Yunus heading the interim government, Bangladesh is seeking as much as USD eight billion in budgetary support from IMF, World Bank, ADB and other international lenders to tide over its economic crisis.
The country is now standing on over USD 100 billion external debt and needs USD three billion from IMF to pay back foreign liabilities as well as USD 300 million for flood rehabilitation programs.
An IMF team is said to be visiting Dhaka next month to hold talks with the Yunus government. The IMF has so far released USD 2.3 billion under the USD 4.7 billion loan program approved in January 2023 when Sheikh Hasina was in power.
Even though the hangover of Islamist coup against Sheikh Hasina is still to get over, the country is facing a double whammy in the form of political and economic crisis.
The matters have been compounded by liberal Yunus lifting a ban on Jamaat-e-Islami Bangladesh along with other Islamic fundamentalist organizations who want to turn the country from Islamic Republic to Emirate with Sharia being imposed on the population.
While Islamists parties like the BNP are on a high after the ouster of Sheikh Hasina, the state of economy is already starting to bite the Interim government.
The Awami League party of Sheikh Hasina is in disarray after the coup and the Hindu minorities are being purged in the name of Awami League and orchestrated anti-India sentiment over floods in
Chattogram area.
The inflation is rising due to commensurate rise in the consumer price index and the food inflation has crossed 14 per cent in July, the highest in the past 13 years.
To tide over the economic crisis and stress in the banking sector due to rising NPAs, the Yunus government will seek USD five billion from lenders like World Bank, ADB, Japan International Cooperation Agency and the Asian Infrastructure Investment Bank.
If the Interim government is not able to take drastic measures to tackle the financial sector and initiate reforms all over the country, then the political heat in the country will rise especially among the radicalized youth, who have already tasted blood by dethroning Hasina.
Clock has started to click for Dhaka again.