World Bank Approves $350 Million Loan for Bangladesh’s LNG Imports

The World Bank has approved a $350 million loan for Bangladesh to help ensure affordable financing for liquefied natural gas (LNG) imports amid ongoing volatility in the global energy market.

The information was disclosed in a press release issued on Monday by the World Bank’s Dhaka office.

The loan was approved on May 15 as additional financing for Bangladesh’s “Energy Sector Security Enhancement Project.”

According to Jean Pesme, rising LNG prices and supply disruptions caused by tensions in the Middle East have increased pressure on energy-importing countries such as Bangladesh.

He said Bangladesh is currently facing significant financial strain due to its dependence on imported energy, and the World Bank is expanding its support to help stabilize LNG supplies. This support is expected to protect the economy and consumers from costly energy shortages.

Pesme also noted that ensuring a reliable gas supply would positively impact power generation, industrial production, and employment. Bangladesh relies heavily on imported LNG to meet its growing electricity demand and keep industries operational.

However, instability in the global energy market driven by Middle East conflicts has increased both prices and supply risks, putting additional pressure on the country’s foreign exchange reserves and public financing.

The World Bank stated that the additional financing would facilitate affordable funding for LNG imports and strengthen Bangladesh’s energy security. It will also improve the payment capacity of state-owned Petrobangla for LNG imports.

As a result, Bangladesh is expected to secure LNG supplies under long-term agreements more easily while reducing dependence on the costly spot market.

The organization further said that reliable and affordable energy supplies would boost industrial production, support private sector growth, and create new employment opportunities.

The additional financing package also includes an IDA payment guarantee-backed financing facility. This mechanism will help secure payments for LNG imports through standby letters of credit (LCs) and short-term credit lines.

The World Bank hopes the initiative will help Bangladesh move toward a more predictable and long-term LNG procurement strategy while strengthening its ability 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 scheduled to continue until December 31, 2031.