A 12-member mission from the International Monetary Fund (IMF) has arrived in Dhaka to begin preliminary discussions on a new lending program. Throughout the week, the mission will hold a series of meetings with Bangladesh Bank and various government ministries to review the country’s economic situation, progress on reforms, and the possible structure of a new loan program. It has also been learned that the IMF will discuss the proposed new pay structure for government employees and officials.
The IMF delegation will begin meetings tomorrow, Sunday, with Bangladesh Bank, the Finance Division, and various ministries and government departments. As part of the discussions, the delegation is also scheduled to meet Finance Minister Amir Khasru Mahmud Chowdhury at the secretariat tomorrow. The mission is being led by Ivo Krznar, Deputy Division Chief of the IMF’s Monetary and Capital Markets Department.
The government hopes to secure a loan of $4 billion to $4.5 billion from the IMF under the new program for a period of three years. The funds are planned to be used to maintain macroeconomic stability, address pressures on external financing, and advance economic reforms. To this end, the finance minister sent a formal letter to the IMF on 9 June.
In the letter, the IMF was informed that the economic and policy circumstances have changed significantly since the previous lending program was initiated. Due to shifts in the political economy, global uncertainties, and new economic challenges, some reforms could not be implemented within the originally set timeframe. However, the government stated that it has not moved away from the reform agenda; rather, it intends to implement the reforms gradually in a manner consistent with the country’s current realities.
The agenda
According to sources at the Finance Division, discussions this time will cover almost all major economic indicators. The IMF will hold detailed discussions on the rationale behind various tax exemptions included in the recently announced budget for the 2026–27 fiscal year, the failure to meet revenue collection targets, progress in income tax and value-added tax (VAT) reforms, tax expenditure reforms, and strategies for financial sector reform.
The banking sector will also remain a key focus of the discussions. The IMF will review measures to strengthen governance in the banking sector, strategies for reducing non-performing loans, financing arrangements for bank restructuring and liquidation processes, the autonomy of Bangladesh Bank, and progress in risk-based supervision.
In addition, discussions will cover the reasons behind lower revenue collection and rising public debt, increased subsidies in the power and energy sectors, adjustments to electricity prices, the financial condition of state-owned enterprises, and government spending on social safety net programs, including the Family Card initiative.
Finance Division officials said the IMF will also seek information on how realistic the GDP growth target for the 2026–27 fiscal year is, the effectiveness of social safety net programs, and how efficiently funds under the Annual Development Programme (ADP) are being utilized.
Separate assessment on the new pay structure
After completing its Dhaka visit, the IMF delegation will submit an assessment report to its headquarters in Washington. If the assessment is positive, another mission may visit Dhaka after the annual meetings of the IMF and World Bank in October to begin formal discussions on the new lending program.
The salaries and benefits of government officials and employees will also undergo a separate assessment. The IMF will seek information on the current number of government employees, plans for new recruitment, the existing pay structure, policies on annual salary increments, and the financial impact of various allowances.
A separate review of the power and energy sector will examine power plant capacity charges, fuel import costs, electricity price adjustments, and financial transactions between the Ministry of Finance and the Bangladesh Power Development Board. At the same time, subsidies for natural gas, government support provided to Petrobangla, and the overall financial flows within the energy sector will also be reviewed.
Government debt management will be another important topic of discussion. The IMF will examine plans for domestic and foreign borrowing, government guarantees, liabilities of state-owned enterprises, the structure of external debt, future loan disbursement schedules, refinancing requirements, and the balance between low-interest development loans and commercial borrowing.
Officials from the Ministry of Finance said these meetings will provide an initial understanding of the possible conditions and priorities of the new lending program. At the same time, the government will present some of its recent progress, including developments in the market-based exchange rate system, modernisation of monetary policy, enactment of bank resolution and deposit protection laws, risk-based banking supervision, climate-related reforms, and initiatives to rebuild foreign exchange reserves.
After completing its Dhaka visit, the IMF delegation will submit an assessment report to its headquarters in Washington. If the assessment is positive, another mission may visit Dhaka after the annual meetings of the IMF and World Bank in October to begin formal discussions on the new lending program.
Bangladesh entered into a $4.7 billion lending program with the IMF in 2023. Later, in June 2025, during the tenure of the interim government, the size of the program was increased to $5.5 billion. So far, Bangladesh has received $3.64 billion in five installments. However, despite nearly a year of discussions over the release of the sixth installment, the funds were ultimately not disbursed. Following this, both sides are now moving toward a new lending program.
