Bangladesh will ask for US$1.0 billion in budget support from Japan during Prime Minister Tarique Rahman’s tour on 26 October 2026. Officials stated the total sum will be split into two instalments of $500 million each. The first half will be requested for the current fiscal year, and the second half will be sought in the following year. Prime Minister Tarique Rahman is scheduled to visit Japan for four days to discuss trade, investment and economic cooperation.
Finance Division officials reported that Bangladesh has not received any budget-support loans during the first three months of the current fiscal year. Final talks are starting for $100 million from the OPEC Fund for International Development. Officials added that discussions with the Japan International Cooperation Agency have not started yet. Bangladesh previously received $316 million from Japan International Cooperation Agency in the last fiscal year and $414 million in fiscal year 2025. The new funds from Japan will help pay for costly fuel oils and liquefied natural gas imports driven by Middle East conflicts.
Initial talks are happening with the Asian Development Bank for separate budget-support loans, but those deals will likely take until next March. The national economy faced severe pressure starting in early 2022 after the Russia-Ukraine war pushed up global inflation. Lower remittance inflows and export earnings reduced foreign-exchange reserves, leading the government to seek a $4.7 billion loan from the International Monetary Fund in January 2023. Recent Middle East conflicts increased fuel and liquefied natural gas prices, raising government subsidy spending. Dr Zahid Hussain, a former lead economist at the World Bank Dhaka office, mentioned that getting these loans depends on comfort levels with the International Monetary Fund. He suggested cutting budget spending to reduce import costs and foreign currency demand. He also advised keeping exchange rates flexible and matching domestic energy prices with international rates.