The United States Agency for International Development has halted funding and work from Bangladesh under existing contracts, grants, and agreements. This is a significant blow to the interim government of Muhammad Yunus in Bangladesh. The directive, issued to USAID’s implementing partners in Bangladesh on Saturday, follows a sweeping executive order by President Donald Trump, pausing all foreign aid for 90 days as part of a comprehensive review of U.S. foreign assistance.
In a letter to partners, USAID ordered an immediate halt to all work under its programs in Bangladesh, saying that U.S. foreign aid needed to be aligned with “American interests and values.” The suspension includes billions of dollars in vital aid for health, education, food security, and humanitarian programs, including support for the Rohingya refugee crisis.
“This letter serves as a directive to all USAID/Bangladesh implementing partners to immediately stop, cease, and/or suspend any work performed under your respective USAID/Bangladesh contract, task order, grant, cooperative agreement, or other acquisition or assistance instrument,” USAID stated.
This suspension is part of a wider policy to review U.S. foreign aid. A memo signed by Secretary of State Marco Rubio confirmed that the review would be completed within 85 days, with recommendations presented to the President.
The suspension of U.S. aid is likely to be a disaster for the economy and governance of Bangladesh. USAID projects in Bangladesh are the biggest in all of Asia, continuing initiatives that aid in critical areas concerning food security, health, governance, and environmental protection. The aid freeze also threatens the country’s response to the ever-on-going Rohingya refugee crisis and stabilizes its key industries, including textiles.
The Yunus administration, which has faced severe economic woes, has been clamoring for heavy foreign aid, in the form of a $4.7 billion IMF bailout and $5 billion in stabilization packages to prop up its dwindling foreign reserves. Last year alone, the US committed $202 million in assistance to Bangladesh under a 2021 deal worth $954 million in assistance to be disbursed over 2021-2026.
International attention has been accorded to such a decision through regional and other international actors. Indian External Affairs Minister S. Jaishankar met, in brief words, with United States officials Marco Rubio and Mike Waltz, respectively, during a recent visit relating to the issue of Bangladesh. Indian American Congressman Shri Thanedar has spoken out for an imposition of sanction on those causing Bangladeshi human rights, focusing on a minority’s status in the Bangladesh nation.
The Trump administration has defended the decision saying that foreign aid must align with U.S. values and policy priorities. “The United States foreign aid industry and bureaucracy are not aligned with American interests and, in many cases, are antithetical to American values,” the White House stated, adding that aid programs often undermine global stability.
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