The World Bank (WB) will provide a grant amounting $250 million with an eye on helping to recoup the losses Bangladesh suffered due to the recent flood, Finance Adviser Dr Salehuddin Ahmed told reporters on Wednesday in Washington, D.C., United States (US).
He met the press after a meeting with Martin Riser, regional vice president of South Asia at the World Bank, on the sidelines during ongoing annual meetings at the headquarters of the World Bank.
Meanwhile, later on the same day, the adviser also met with the officials of the U.S. Department of State and with the Indian Finance Minister Nirmala Sitharaman.
U.S. Department of State officials said that Bangladesh has to wait more to get special duty-free facility, Generalised System of Preferences (GSP), in the U.S. market. However, the U.S. will stand by the interim government of Bangladesh. The North American country has also assured Bangladesh giving all kinds of support and cooperation.
The finance adviser and Ahsan H. Mansoor, the governor of Bangladesh Bank (BB), are meeting with various countries and development cooperation organisations on the side line in the capital of the U.S., where they have been participating in the World Bank Group's 2024 Annual Meetings.
Later, in a briefing at the Office of the Alternate Executive Director (AED) for Bangladesh, Bhutan, India and Sri Lanka, the WB was informed that the U.S. was not satisfied with Bangladesh's progress on some other issues, including labour rights.
They want to see more progress on these issues, according to a source.
Representatives of Bangladesh replied that the Bangladesh is improving step by step in these sectors and more time is required for the country's manpower.
Adviser Salehuddin Ahmed said that interim government's expectation from the development partners is a little higher at the ongoing WB meetings. "They have assured to help Bangladesh in all kinds of reformation activities."
Replying to a question about price inflation, the financial adviser said that the government is making all possible efforts, but Bangladesh will have to wait for a few more months to get the benefits. The IMF and the WB are also working for the country's inflation issue. "Suggestions by them are being implemented," he said referring to IMF and the WB.
Meanwhile, the WB has thanked Bangladesh for being able to pay outstanding debt. Repayment of nearly $2.5 billion in debt instalments without taking a single penny from the reserves is also easing the country's volatility regarding the dollar. As a result, Bangladesh's import inflation will also drop down in the coming days, according to a source.
Many other issues were fruitfully discussed in the side line meeting, the source added
Finance Adviser Salehuddin Ahmed also said that after overcoming the dollar crisis, the country's economy is gradually returning to normal. "The current interim government is paying the debts of the previous government."
He said a lot of money has gone from the bank under the cover of six per cent - nine per cent interest rates. "That is why time is required to fix the banking sector. That was a wrong decision."
Meanwhile, in response to the question of whether there has been any pressure in the implementation of the budget left by the fallen government, he said that the unnecessary expenses from the budget will be reduced. "The income sector would not see any cut. However, the expenditure sector will be trimmed a little."
The adviser mentioned that the World Bank and IMF have given some advice on Bangladesh's comparatively higher inflation. "It will take several months, not a month or two, to become bearable. But no new money will be printed. Inflation was increased by printing money earlier."
Talking about the nature of the economy, he said that new big companies should come in the capital market of Bangladesh. "There have been irregularities in this sector and we are trying to stop them. We are ensuring that there is no unnecessary increase in the floor price of any company. Investors are being cheated by raising the price of shares in the weakest Z category company accounts. We are closing it."
"The World Bank said the GDP growth of Bangladesh will decrease, but we think it will not go to the bottom," he said.
Meanwhile, the BB governor Mansoor attended a US-Bangla Business Council dinner on Budhra night. On the sidelines of this conference, finance adviser participated in bilateral meetings with various countries and supporting organisations.
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