Bangladesh targets IMF loan framework agreement by early 2027
Bangladesh is working toward a new loan programme and financing framework with the International Monetary Fund as technical discussions continue over economic reforms and funding terms. The government expects to reach a final settlement by January-February next year, marking a shift from extending the previous programme to designing a package aligned with current economic conditions.
Highlights
- Bangladesh and the IMF are negotiating a new programme focused on financing size and reforms, with a framework agreement expected by January-February 2027.
- The discussions involve key areas such as exchange rate management, banking sector reforms, subsidy reductions, and revenue collection enhancements integral to any IMF package.
- Dhaka seeks a restructured IMF programme tailored to current economic conditions rather than an extension of the previous arrangement, emphasizing realistic policy timelines.
Negotiations focus on reforms and financing terms
As reported by The Business Standard, Finance and Planning Minister Amir Khosru Mahmud Chowdhury says Bangladesh and the IMF are continuing technical-level discussions on the terms of a proposed new programme, including the size of financing and the scope of required reforms.He disclosed the timeline to journalists after inaugurating Bangladesh's first international debt conference at Ocean Paradise Hotel in Cox's Bazar on 15 November. According to the minister, working groups from both sides are still discussing the framework with the aim of finalising it by January-February.
The talks cover exchange rate management, banking sector reforms, cuts to subsidies on electricity and fertiliser, and steps to raise revenue collection. These areas are central to the structure of any fresh IMF-backed package and to the policy adjustments that would accompany it.
Government seeks a revised programme structure
Dhaka is signalling that it does not want to simply roll over the previous IMF arrangement, but instead build a new financing framework that reflects the country's current economic conditions and the policy priorities of the elected government.Khosru says the existing programme includes elements that an elected administration cannot implement quickly or in the same sequence. He argues that reforms in multiple sectors require continuity and careful timing, and that moving too fast on sensitive measures could hurt households, businesses and the broader economy.
Previously, we highlighted Bangladesh banking reforms as IMF support continued alongside mounting debt and fiscal pressures.