Finance adviser Salehuddin Ahmed on Wednesday said that the International Monetary Fund would release $1.3 billion in the next month under its $4.7 billion loan programme for Bangladesh.
He made the statement after Bangladesh decided that it would follow market-based exchange rate.
The Washington-based multilateral lender disbursed $2.3 billion in three tranches until June 2024 under the loan programme initiated in 2023 by the Awami League government before being ousted on August 5,聽 2024, amid a mass uprising.
The disbursement of the fourth tranche, which was due in February, was deferred until June with the review on the fifth tranche due to differences over the IMF condition of a wider flexibility in the exchange rate.
The interim government that assumed power on August 8, 2024, was negotiating with the IMF but failed to reach any agreement with the IMF over the issue.
鈥楤oth the tranches will now be disbursed following agreements over reforms in the areas of revenue and exchange rate,鈥� said the finance minister in a statement released by the finance ministry on Wednesday.
On midnight past Monday, an ordinance was promulgated to dissolute the National Board of Revenue into two divisions 鈥� Revenue Policy Division and Revenue Management Division.
The separation of the NBR鈥檚 policymaking from its revenue collection is one of the major conditions of the IMF鈥檚 current loan programme.
However, the issue had been under consideration of successive governments since 2003.
In 2009, the military-backed caretaker administration had approved bifurcation of the NBR, but failed to promulgate an ordinance in this regard.
Wednesday鈥檚 statement by the finance adviser came within an hour after Bangladesh Bank governor Ahsan H Mansur at an online press conference from Dubai of the United Arab Emirates said that the dollar price would be determined by the market in the country.
He hoped that the decision would not cause much volatility on the market.
The BB governor鈥檚 statement was in stark contrast to his previous observations he made in the past month that they would not invite volatility on the foreign currency market by meeting the IMF condition for a wider flexibility.
General Economics Division member Monzur Hossain had also opposed a more flexible exchange rate policy, saying that the local market was not matured enough to deal with it.
Since May 2024, the Bangladesh Bank has been maintaining a crawling peg determined between the fixed rate and the floating rate by the suggestion of the IMF to check volatility in the exchange rate rocked the last two years of the AL regime.
The exchange rate had been almost free floated since 2003 to 2020, said former World Bank Dhaka office lead economist Zahid Hussain.
He blamed the policymakers of the ousted AL government for intervening in the exchange rate excessively causing a prolonged volatility on the market.
In 2023 alone, the local currency, taka, depreciated against the US dollar by 26.1 per cent, the highest in 46 years.
The dollar rate was Tk聽122 on Wednesday, according to Bangladesh Bank data.
The release of the IMF loan will also help Bangladesh get budget supports from the other lenders such as the Asian Development Bank, the World Bank and the Japan International Cooperation Agency.
In the finance ministry鈥檚 statement, the finance adviser projected that the country would receive about $2 billion in budget support from the other multilateral lenders by June.
He hoped that the country鈥檚 foreign exchange reserve, which is hovering at $22 billion as per the international standard in the current month, would be bolstered in the next month with release of the loan.
