Govt expects to meet IMF-set NIR threshold by June 30

Over US$2.0 billion is received thus far this June and $650 million more is expected by Sunday in budget support as the government races against time to meet an IMF-set forex target by this fiscal yearend.
Bangladesh has to have a net international reserves (NIR) position at $14.786 billion under a pared-down threshold set by the International Monetary Fund (IMF) in its lending package.
For this passing last month of the financial year, the IMF, under the ongoing $4.7-billion loan programme, revised down the floor for NIR at $14.786 billion from previously set $20.10 billion, after the government had missed the December target in the wake of depletion of the country's foreign-exchange reserves.
The NIR target for last December was $17.78 billion but, at the end of the month, the actual NIR position was worth $16.72 billon, according to the central-bank data supplied to the IMF.

However, at the end of April 2024, the NIR counted $12.8 billion, lower by around $2.0 billion than the June target.
A senior finance official told the FE Thursday that meeting the June NIR target was a big challenge for the government amid higher debt-servicing obligations and supporting imports by supplying requisite foreign currency.
He said the country could not meet the December NIR requirement so had to seek a waiver from the IMF and also had sought a cut-down NIR target for June. "If the NIR target for June is not met, release of the next tranche of loan may land into difficulties."
According to Finance Division data Bangladesh received some $250 million from the Asian Development Bank (ADB), $500 million from the World Bank, $1.148 billion from the IMF, 43 million euros from Agence Française de Développement (AFD), and $24 million from the World Bank in the month of June alone under the budget-support programme.
By June 30 (Sunday), some $400 million more from the Asian Infrastructure Investment Bank (AIIB), $100 million from South Korea, 60 million euros from the European Union, $40 million from the ADB, and 45 million euros from the AFD are expected to come, the FD official said.
"These will help us to meet the NIR target for the period of June," the official hopes over the fundraising drive.
He mentions that NIR is the lone quantitative performance criteria that the government has been continuously failing under the strings-tied IMF lending recipe.
Another finance official says the government has introduced crawling-peg system to make the exchange rate of local currency more flexible in line with a suggestion of the IMF. "This will help further buildup of foreign- currency reserves which have been on a slide during the last two years," he adds.
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