The United States Agency for International Development (USAID) has issued a directive to all implementing partners in Bangladesh, mandating an immediate cessation of activities under its contracts, grants, and cooperative agreements, in compliance with a US executive order on foreign aid reassessment.
The order, signed by USAID's Office of Acquisition & Assistance, instructs all partners to halt work and avoid incurring additional costs under their agreements.
Resumption of operations is strictly prohibited unless formally authorised in writing by a designated USAID official.
This decision stems from a broader realignment of US foreign aid policies, as per an executive order signed during Donald Trump’s presidency.
USAID’s notice specifically references the “Implementation of Executive Order: DEIA Activities Under Existing USAID Awards,” requiring implementing partners to submit certifications confirming the cessation of all Diversity, Equity, Inclusion, and Accessibility (DEIA) activities.
Largest USAID Programme in Asia Disrupted
The USAID programme in Bangladesh is among the agency’s most extensive in Asia, spanning key sectors such as food security, health, education, democracy, governance, and humanitarian assistance, particularly in response to the Rohingya crisis.
With an annual budget of approximately $40 million allocated for Feed the Future initiatives alone, USAID’s activities have supported over a million people annually, improving agricultural productivity, nutrition, and financial accessibility for farmers and small businesses.
In 2023, USAID-backed agricultural projects facilitated over $500 million in farmer and agribusiness sales, catalysed $11.1 million in additional financial access, and provided safe drinking water and sanitation facilities to over 87,000 individuals.
Impact on Governance, Climate, and Health Initiatives
Beyond agriculture, USAID has played a pivotal role in strengthening Bangladesh’s governance, environmental resilience, and healthcare system.
Its democracy and governance programmes have sought to enhance citizen confidence in government institutions, while climate resilience projects have trained over 130,000 farmers in adaptation strategies.
USAID’s contributions to Bangladesh’s health sector have been extensive, supporting maternal and child healthcare, tuberculosis treatment, and nutrition interventions.
Notably, in 2023, the agency aided in launching the country's first medical device testing laboratory and facilitated new legislation to regulate pharmaceutical safety.
The suspension raises concerns over the future of these initiatives, including emergency disaster relief efforts.
USAID has been instrumental in rehabilitating over 900 disaster shelters and responding to major flooding crises in Sylhet, Sunamganj, and Bandarban.
Rohingya Crisis Response Also Affected
As the largest contributor to Rohingya humanitarian assistance, with nearly $2.4 billion in aid since 2017, USAID has provided critical support for refugee camps in Cox’s Bazar.
Programmes addressing food security, disaster risk reduction, and economic resilience in both refugee and host communities may now face disruption.
Uncertain Future for USAID Operations in Bangladesh
While USAID has reassured partners that further guidance will follow, the indefinite nature of the suspension leaves many development projects in limbo.
The broader implications of this halt remain uncertain, particularly as Bangladesh approaches its 2031 target of achieving upper-middle-income status—a goal heavily supported by international development partners.
Local stakeholders, including NGOs and government agencies, await clarification on whether exemptions or alternative funding mechanisms may be pursued.
The decision underscores the impact of shifting US foreign policy priorities on development efforts in South Asia, leaving Bangladesh’s extensive USAID-backed programmes at an abrupt standstill.
