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Bangladesh has recently sought $1.0-billion budgetary support from Japan to facilitate the country's post-flood recovery in the eastern region and also to weather the economic storm, officials said on Saturday.
"We sent a request letter to our friendly country Japan early this month seeking its support. Bangladesh needs sizeable funds to recover the economy, damaged by some wrong macro-economic policies of the Sheikh Hasina government and sudden floods in late August," said a senior official of the Economic Relations Division (ERD).
"We also wrote to Japan seeking its budget support in last regime…"
The government has also requested the World Bank, the Asian Development Bank, the International Monetary Fund (IMF), the Asian Infrastructure Investment Bank (AIIB), the New Development Bank (NDB), the French lender AFD and others for the same.
Recent floods deluged 11 districts in eastern and north-eastern parts of Bangladesh claiming at least 59 lives and impacting over 5.3-million people.
Millions of dollars have been lost in agriculture, industry and service sectors as dozens of roads and bridges got destroyed, croplands submerged, and fisheries and livestock damaged.
"Japan usually provides us loans to execute different projects. After the Covid pandemic in 2020, it started to give us some budgetary support too. As Bangladesh's economy has been affected by recent floods, we need budgetary support for economic recovery," said another ERD official.
Last June, Japan provided JPY30 billion (equivalent to $225 million) as budgetary support to Bangladesh.
Earlier, it also provided two rounds of budget aid amounting to total 685 million yen ($4.7 million) in 2020 and 2021.
Japan is Bangladesh's largest bilateral development partner, which helped it build three metro rails, third terminal at the Hazrat Shahjalal International Airport and Jamuna Railway Bridge.
"Japanese loan is very concessional. It will be good for Bangladesh if the budget support from Japan is confirmed," according to the ERD official.
For the $225-million budget support in June, the loan came with an annual interest rate of 1.6 per cent with a 30-year repayment period, which includes a 10-year grace period.
"We are eagerly waiting for Japan's response to our latest budget support request," the official added.
Meanwhile, the WB, ADB, AIIB and IMF have already assured the interim government of providing necessary support for the recovery of economic shocks and post-flood impacts.