America is coming to the aid of Bangladesh, which has sought another multibillion-dollar loan from the International Monetary Fund.
A US delegation will hold talks with the interim government of Bangladesh, including its leader Muhammad Yunus, in Dhaka on September 14 and 15.
These will be the first high-level talks between the two nations since a student-led protest movement toppled former prime minister Sheikh Hasina, who fled to India on August 5.
Yunus, the 84-year-old Nobel laureate, microlending pioneer and founder of Grameen Bank, took the helm of the interim government as its chief adviser following the ouster of Sheikh Hasina.
US plans economic talks with Bangladesh’s interim leader Muhammad Yunus, FT reports https://t.co/kc2y37uBHy pic.twitter.com/b1LOy8Sgv2
— Reuters (@Reuters) September 10, 2024
‘US Optimistic’
“The United States is optimistic that, by implementing needed reforms, Bangladesh can address its economic vulnerabilities and build a foundation for continued growth and increased prosperity,” Brent Neiman, assistant US Treasury secretary for international finance, told the Financial Times.
Bangladesh, once a regional economic success story, turned to the IMF for a $4.5 billion bailout in 2022 after the Covid-19 pandemic and war in Ukraine disrupted world markets and caused its energy and other import costs to soar.
Weeks of violent unrest leading to the ouster of Sheikh Hasina have also hit the economy.
Bangladesh is seeking an additional $3 billion from the IMF to recover from the political turmoil, Bloomberg reported in August.
Bangladesh is south Asia’s second-largest economy and its economically vital garments sector is the world’s second largest after China.
However, the garments industry was badly hit by the unrest in which at least 600 people were killed according to a preliminary United Nations report. Industry officials told the Financial Times that some apparel chains had shifted orders to rival producers in Southeast Asia.
The US has called on Bangladesh to implement reforms in the industry, including the decriminalisation of trade unions, and Yunus has called for labour reforms to help garment producers win more orders.
Indian view
Sheikh Hasina’s overthrow was widely seen in India — her staunch ally — as advancing US foreign policy aims that could undermine India’s interests and influence in Bangladesh.
The Financial Times says “the events have revived lingering antipathy towards the US in India”, which backed Sheikh Hasina’s father Sheikh Mujibur Rahman in Bangladesh’s 1971 war of independence, while Washington supported Pakistan.
However, the US State Department has denied any role in Hasina’s overthrow. “Any implication that the United States was involved in Sheikh Hasina’s resignation is absolutely false,” Vedant Patel, a State Department spokesperson, told reporters in August.
A report in the Economic Times newspaper in India in August had cited Hasina as accusing the U.S. of playing a role in ousting her because it wanted control over Bangladesh’s Saint Martin’s island in the Bay of Bengal. The newspaper said Hasina had conveyed that message to it through her close associates.
However, Hasina’s son, Sajeeb Wazed, in a post on X, said she never made any such statement.