ITFC signs $3.3bn financing program with Bangladesh

The International Islamic Trade Finance Corporation (ITFC) – a faction of the Islamic Development Bank (IsDB) – has signed a $3.3 billion annual financing program with the Bangladeshi government for the 2026-2027 fiscal year, ITFC announced on Sunday, 5 July. 

Bangladesh is one of the countries worst-affected by the ongoing disruption in the Strait of Hormuz, with the waterway’s effective shutdown threatening food and energy security in the South Asian nation.

The financing program is set to support imports of petroleum products, liquefied natural gas (LNG), and fertilisers. To this end, it finances Bangladesh Petroleum Corporation (BPC), Bangladesh Oil, Gas & Mineral Resources Corporation (Petrobangla), and Bangladesh Agricultural Development Corporation (BADC). 

Over half of Bangladesh’s energy supply comes from imports. The country’s primary energy imports climbed from just under 48% in 2020 to nearly 63% in 2025, because domestic gas production fell from around 2,500 million cubic feet (mmcf) in 2018 to around 1,700-1,800 mmcf by 2026, driven largely by underinvestment.

The recent disruption’s impact has been particularly stark as 1.4 million tonnes of crude oil transiting the Strait heads for Bangladesh every year, and 75% of Bangladeshi LNG imports are sourced from Qatar, where LNG production has been significantly halted. 

In 2024, 66% of Bangladeshi electricity relied on LNG. In the last two weeks, there have been daily power cuts between 600 megawatts (MW) and 3,350 MW, attributed to the government’s growing energy bills. 

Additionally, before the conflict, roughly a third of globally traded urea and nearly half of traded sulphur transited the Strait. Urea is the world’s most commonly used fertiliser and sulphur is a critical nutrient for plants. 

For Bangladesh, a fully import-dependent country for fertilisers – 35% of which come from the UAE – the impact was particularly dire, amplified since March-to-July is a key agricultural season. 

Just last week, the Bangladeshi and Saudi Arabian governments reached an agreement for chemical producer Saudi Basic Industries Corporation (SABIC) to supply Bangladesh with urea fertilisers via an alternative route from Al-Jubail Port to Yanbu Port in the 2026-2027 fiscal year. The new financing programme could also facilitate this agreement. 

The program is the latest in the longstanding partnership between ITFC and the government of Bangladesh, having unlocked over $22.6 billion in financing since 1977.