Special Correspondent – The International Monetary Fund (IMF) has sought a comprehensive evaluation of the fiscal impact of Bangladesh’s upcoming civil service pay structure.
The development surfaced during a high-level meeting between an IMF delegation and the Finance Division on Sunday, where government officials outlined plans to gradually implement the new salary framework starting this month.
While the national budget has already set aside necessary allocations for the salary adjustment, Finance Division officials noted that the Cabinet will ultimately determine the exact phases and final scale of the implementation.
“The IMF did not offer any specific commentary on the pay structure itself,” a Finance Division official stated on the condition of anonymity. “Instead, they requested details regarding its potential implications on overall budget execution.”
A Departure from Past Conditionalities
The formal discussions kicked off at the Secretariat, led by a 12-member IMF team under Bangladesh Mission Chief Ivo Krznar.
While eight bilateral sessions were scheduled for the day, a highly anticipated meeting with the Finance and Planning Minister, Amir Khosru, was canceled as the minister left to attend the funeral prayers (Janaza) of former Parliament Speaker and former Acting President, Barrister Jamiruddin Sircar.
Speaking to reporters later at the Secretariat, Minister Amir Khosru took a critical stance on past economic engagements, labeling the previous administration’s IMF loan program as “completely against public interest.”
He emphasized a shift in policy, stating:
“Our primary concern is not merely securing a loan, but safeguarding national interests. The government will not enter into any agreement with the IMF that compromises the welfare of our people.”
The Minister further asserted that as an elected government, protecting the public and stabilizing the economy remain top priorities.
Consequently, any new loan program must ensure that the interests of the citizens of Bangladesh are fully protected.
The interim government is currently angling for a fresh three-year IMF support package valued between $4 billion and $4.5 billion.
The capital injection is deemed crucial to maintaining macroeconomic stability and relieving severe pressure on the country’s foreign exchange reserves.
This follows a formal letter dispatched by the Finance Minister to the IMF on June 9, which explicitly pointed out that the economic ground realities under which the previous loan was brokered have fundamentally changed.
The letter underscored that while certain reforms remain challenging due to shifting political economies, global uncertainties, and new structural challenges, the government intends to pursue pragmatic, phased reforms.
Reviewing the Financial Slate
The new negotiations mark a clean break from a previous $4.7 billion credit facility signed by the Awami League government in January 2023, which was later augmented to $5.5 billion in June 2025.
Although Bangladesh successfully received $3.64 billion across five tranches, the program was ultimately terminated by mutual consent after the sixth installment hit a standstill.
Beyond the civil service salary adjustments, Sunday’s exhaustive sessions between the IMF mission, the Finance Division, and Bangladesh Bank officials covered a wide array of fiscal metrics.
Key agendas included the mid-term budget framework, revenue mobilization strategies, subsidy rationalization, social safety net allocations, development project financing, and expenditure tracking for targeted subsidies like the Family Card and Farmer Card initiatives.