An International Monetary Fund (IMF) delegation visiting Bangladesh has come under fierce attack from the country's finance and planning minister, Saifur Rahman, who has severely criticised what he describes as the multilateral agency's wrong prescriptions and policies.

The impact of the IMF's advice on letter of credit (L/C) policies is just one area the Bangladeshi minister is concerned about.

Creating problems

"The prescriptions you people are giving are creating problem[s] and our internal policy is much better than yours," Rahman reportedly told the six-member delegation led by IMF Advisor for Asia Pacific Region, Thomas Rumbaugh.

The IMF delegation was on a two-week visit to Bangladesh during November.

Vulnerable reserves

Speaking with journalists after his meeting with the IMF delegates, Saifur singled out the multilateral agency's prescription for L/Cs for particular criticism.

"I accepted the zero margin policy on opening L/Cs following the prescription of IMF. The policy led to huge imports, making the foreign exchange reserve vulnerable," he said.

More criticisms

Rahman also attacked the IMF's advice on farming subsidies. "We are giving fertiliser to farmers at a nominal price, which even is lower than the price of gas used to produce it. Such high rates of subsidy lead to high taxation and duties on other products, which contributes to price hikes of essential commodities," he said.

"Why do they give us such misleading policy?" asked Rahman, who also criticised the IMF delegation's advice on petroleum prices, tax reforms and the liberalisation of the banking sector.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.