BPC Loan of Tk 4,500 Crore Ends 11-Year Wait for Fuel Import Cash

The government has approved a Tk 4,500 crore BPC loan to help the Bangladesh Petroleum Corporation buy fuel. It is the first support of this kind in 11 years, the Daily Star reported on 30 September.

The Finance Division is providing the money interest-free. BPC will repay it in half-yearly instalments over five years, after a six-month grace period. The corporation had warned that it might be unable to open letters of credit for fuel imports as early as October.

Why the BPC loan was needed

BPC lost Tk 22,876 crore between March and August while settling import contracts. Global oil prices climbed after the US-Israel conflict began in March. Domestic prices did not keep pace.

The state absorbs about Tk 70 on every litre of diesel. Diesel sells at Tk 135 a litre. Under full automatic pricing, it would cost about Tk 205. An IMF-backed pricing formula has not yet closed that gap. Fuel prices rose by Tk 20 a litre on 20 September.

The cost to the budget

Economists see a trade-off. Former World Bank economist Zahid Hussain said the loan will put pressure on the government’s immediate cash flow. He asked whether it would widen the budget deficit or cut development spending.

That question matters to households. Fuel feeds transport, farming and power. If BPC cannot import, shortages follow. If the state borrows more, other programmes may wait.

The loan buys time, not a solution. Prices still sit well below cost. Either consumers pay more, or taxpayers cover the difference. Neither option is popular.

The decision lands as Prime Minister Tarique Rahman’s government juggles several pressures. Our earlier report on the prime minister’s return from the US noted a crowded agenda at home. Energy finance now sits near the top.

Watch three numbers in the coming months. First, BPC’s monthly import bill. Second, any further price change. Third, the Finance Division’s revised borrowing plan. Together they will show whether this is a bridge or a habit.

Fact basis: The Daily Star, 30 September 2026, including figures attributed to BPC and the Finance Division. Read the Daily Star report.