The Bangladesh government hopes to get $250m budgetary support from World Bank at the end of this year as it says significant progress has been made towards meeting the attached conditions.
The global lender, earlier, promised to provide Bangladesh with $500m fund as budgetary support and tagged some conditions including signing MoU with state banks to improve their financial condition.
“Most of the conditions have already been fulfilled. MoUs have been signed with state banks to make specific progress within specified time in improving their financial conditions,” a Finance Division official told the Dhaka Tribune.
In last board meeting in Washington, the World Bank and Bangladesh agreed to do more to develop the country’s transport and energy infrastructure and continue the dialogue on necessary reforms that would merit a development policy credit.
As per the agreed decisions, Bangladesh will get $500m as budget support.
The country will place the progress in meeting the conditions at the Bank’s board meeting in November this year at which the $250 fund is expected to be approved.
Budget support is a form of aid that is transferred straightly into a country’s budget on the condition that its government implements a number of reforms.
After the Washington decision, the technical committee of the Finance Division’s budget wing started negotiation with the Bank authorities for the fund.
The lender has listed nine areas for reforms under the budget support initiative to Bangladesh, which include public fund management, banking, energy, transport, ICT, public private partnership and migrant workers.
Reforms in these areas have been asked to be implemented in three fiscal years, starting from FY2015-16. The Bank also asked to introduce pricing formula for petroleum and electricity so the prices of these products go through changes following the international market.
