The government intends to implement the reforms as part of the loan conditions of the World Bank and the International Monetary Fund (IMF) in phases, Finance Minister Amir Khosru Mahmud Chowdhury has said.
The minister said Bangladesh put forward this proposal during the annual meetings of the IMF and the World Bank group, which commenced in Bangkok, Thailand, on Monday.
Speaking at a briefing following the meeting, Amir Khosru said: “Where there are differences in one or two areas, we have suggested ‘sequencing’. The issue will be resolved step-by-step.”
Explaining the rationale, he added: “As we have said previously, our government was elected by the people. We came to power with a manifesto presented to the public. So, there is a matter of alignment there.”
The annual meetings of the IMF and the World Bank group in Bangkok will run until Oct 18. A Bangladeshi delegation led by the minister is attending the summit.
A major portion of IMF loan conditions typically focuses on the revenue and banking sectors.
They also involve pressure to reduce energy subsidies to reflect market pricing and to move away from a culture of tax exemptions by imposing new taxes.
Following several rounds of talks starting in 2022 amid financial distress, the former Awami League-led government signed a $4.7 billion loan agreement with the IMF in early 2023.
During the subsequent interim government, the loan figure was scaled up to $5.5 billion.
Bangladesh received the first instalment of $476.3 million in February 2023. To date, it has received $3.64 billion across five tranches.
After discussions over the release of the sixth tranche stalled for a year, talks over the loan conditions resumed when the BNP formed the government in February.
The government subsequently submitted a proposal to the IMF to exit the previous framework and secure a new loan.
As negotiations progressed with the expectation of securing a $4 billion to $4.5 billion loan over a three-year period under the new programme, the IMF officially issued a statement on Jun 3 confirming that Bangladesh had formally applied for a new facility.
However, the IMF did not disclose the exact loan amount.
It later dispatched a mission to assess the current state of the Bangladeshi economy and clarify the government's stance on reforms before finalising the conditions.
Main negotiations are slated to take place when the IMF mission visits Dhaka once again following these meetings.
Meanwhile, Bangladesh continues to engage in side talks with development partners.
Responding to a question on the matter, the minister said: “Dialogue is already under way. We have held several meetings so far.
“Discussions with them are scheduled for tomorrow and the day after. So, our dialogue with the IMF is ongoing.”