The World Bank has approved a $350 million loan to Bangladesh to ensure affordable financing for the import of liquefied natural gas (LNG) amid global energy market volatility.
The World Bank's Dhaka office said this in a press release on Monday.
Earlier, the loan was approved on May 15 as additional financing for Bangladesh's 'Energy Sector Security Enhancement Project'.
Jean Pesme, World Bank Division Director for Bangladesh and Bhutan, said that the price of LNG has increased due to the conflict in the Middle East and supply has been disrupted.
“As an energy import-dependent country, Bangladesh is currently facing major financial pressure. The World Bank is increasing its support to Bangladesh to maintain stable LNG supplies, which will play a key role in protecting the economy and people from costly energy crises,” he said.
He also said that ensuring reliable gas supply will have a positive impact on power generation, industrial activities and employment. Bangladesh is heavily dependent on imported LNG to meet its electricity needs. This fuel is playing an important role, especially in power generation and keeping industries running. However, due to the instability in the global energy market due to the conflict in the Middle East, price increases and supply risks have increased. This has also put pressure on foreign exchange reserves and government financing.
The World Bank said, “This additional financing will facilitate affordable financing for LNG imports and further strengthen Bangladesh's energy security. Through this, the state-owned company Petrobangla will increase its ability to pay for LNG imports. As a result, it will be easier to ensure LNG supply under long-term contracts and reduce dependence on purchasing from the expensive spot market.”
The organization also said that ensuring reliable and affordable energy supply will increase industrial production and private sector growth, as well as create new jobs.
A financing facility backed by IDA Payment Guarantee has also been included under this additional financing. Through this, security in payment for LNG imports will be ensured with the help of standby letters of credit (LC) and short-term credit lines.
The World Bank hopes that this initiative will help Bangladesh move towards a more long-term and predictable LNG procurement system and increase its capacity to cope with global market volatility.
The original $350 million ‘Energy Security Enhancement Project’ for Bangladesh was approved by the World Bank’s Executive Board on June 18, 2025. The project is valid until December 31, 2031.
Bd-pratidin English/Lutful Hoque
