The visiting representatives of the organization confirmed to the finance ministry about this money exemption next June. Several top officials of the Ministry of Finance confirmed this to TBS after a meeting with IMF officials yesterday.

The International Monetary Fund (IMF) has finally given the green signal to release $680 million as the third installment of the $4.7 billion loan.

The visiting representatives of the organization confirmed to the finance ministry about this money exemption next June. Several top officials of the Ministry of Finance confirmed this to TBS after a meeting with IMF officials yesterday.

They said that various aspects of the agreement have been finalized to ensure the third installment in a series of meetings with the IMF and various wings of the Ministry of Finance yesterday.

The IMF had stipulated that the country's net foreign exchange reserves should increase to $20.10 billion by June this year, and the lender could reduce it to $17-18 billion, they said.

In order to get the third installment of the loan, the condition of the IMF was to preserve 1 thousand 926 million dollars at the end of March and 2 thousand 10 million dollars at the end of June. A finance official told TBS that currently Bangladesh's net reserves are around $15 billion. Even if this condition is not fulfilled, there is no doubt about getting the third installment.

The official said that there is no difference between the IMF and the government to mention. The government is also working to implement the conditions imposed by the IMF, including reducing subsidies, increasing revenue and reserves.

He also said that the IMF will finalize the reserve conditions in a meeting with Bangladesh Bank on Tuesday. At the same time, the net reserve target will also be redefined by next October and December to receive the fourth installment.

Bangladesh failed to meet the net reserve requirement even before receiving the second installment. Then the IMF signed the MoU by reducing the target for next March and June.

Another official said, the government is also doubtful about achieving the target of the next June-based revenue. "Therefore, the finance ministry has also asked for a concession on the IMF's target for revenue collection based on June. The agency may also give concessions in this regard in the new MoU (memorandum of understanding)."

According to the information of the Ministry of Finance, the government has collected Tk 1 lakh 62 thousand 164 crore against the revised target of Tk 1 lakh 43 thousand 640 crore till last December. However, at the end of the fiscal year, till next June, 3 lakh 94 thousand 530 crore tax revenue has to be collected.

The National Board of Revenue (NBR) has said that the revenue collection may be at least Tk 10,000 crore less than the target at the end of June after analyzing the revenue collection growth of the nine months of the current financial year.

The government is trying to implement the instructions of the IMF

Ahsan H. Mansoor, executive director of the Policy Research Institute, told TBS that this time the IMF has focused on a number of issues - including market-based exchange rates, leaving interest rates to the market, increasing revenue collection and reducing government subsidies. The government is also taking initiatives to adapt and implement policies in line with the IMF.

"IMF may reduce the condition of June-based net reserves from $20.10 billion to $17-18 billion. But it will be difficult to achieve before June" - said this economist.
  
What happens if the conditions are not met?

Former senior secretary of finance. Mahbub Ahmed told TBS that the government is working to fulfill the conditions given by the IMF to get the third installment of the loan. "Though neither the net foreign exchange reserves nor the revenue collection conditions have been met, we are hopeful of receiving the third tranche."

He said it would be difficult to get the two installments of the next financial year if the conditions of the IMF are not met satisfactorily. "Because, the government has time till the next financial year to implement the conditions. So in terms of installment concessions, even if the government is given concessions now under various conditions, the IMF may be tough at the end."

"Bangladesh has never received the last installment of the IMF loan except once in the history of Bangladesh due to not being able to fulfill the conditions. In 2016, when I was finance secretary, I received the last installment of the IMF's $1 billion loan. Before this, Bangladesh could never take the last installment of the loan," he said.

IMF will meet with Bangladesh Bank today

IMF officials will meet with central bank officials on Tuesday morning to adjust banking sector conditions for the third and fourth tranches of the loan.

On the same day at noon, the IMF will agree to the memorandum of understanding finalized by attaching the revised terms and conditions to release the third installment and fourth installment of the loan in a meeting with Finance Minister Wasika Ayesha Khan and Finance Secretary Khairuzzaman Majumder.

After that, the delegation headed by Chris Papageorziou, head of IMF's Development Macro-Economics Division, will leave Dhaka after holding a press briefing on May 8.

This delegation came to Dhaka on April 24 to review the loan program.

Bangladesh signed a $4.7 billion loan agreement with the IMF in January last year amid dwindling foreign exchange reserves. The loan will be repaid in seven installments till 2026.

In February last year, the IMF released the first installment of $447.8 million. And in December, the second installment released 68 million 10 million dollars.