WB set to approve $1.5b in budget support in June

The World Bank is expected to approve $1.5 billion in budget support for Bangladesh this month under three financing programmes, providing relief as the country faces pressure from rising import costs and global geopolitical uncertainty.

Of the total amount, around $800 million will be repurposed from existing project loans through the World Bank’s Rapid Response Option (RRO), which allows member countries to reallocate up to 10 per cent of their ongoing loan portfolio during emergencies. Bangladesh formally applied for RRO support on April 5.

Another $300 million has been earmarked for fertiliser imports and food assistance, while $400 million will support banking sector reforms.

The funding package was finalised after several rounds of negotiations in Washington DC and Dhaka, according to officials involved in the process.

Finance Ministry projections show Bangladesh will require an additional $2.61 billion in the final quarter of FY26 to meet higher import costs for LNG, fuel and fertiliser amid continued volatility in international markets.

About $785 million of the package will be channelled through a Contingent Emergency Response Project framework to finance essential imports and support food security. The remaining $400 million, under the Financial Sector Support Programme, will focus on banking stability and governance reforms.