USAID Suspends Funding in Bangladesh Amid US State Department’s ‘Stop-Work’ Order

GG News Bureau
Dhaka, 28th Jan. In the wake of a sweeping “stop-work” order issued by the US State Department on all foreign assistance, the United States Agency for International Development (USAID) has suspended its funding in Bangladesh, which is currently under the interim government led by Muhammad Yunus.

In an official letter, USAID directed all implementing partners in Bangladesh to immediately halt all ongoing activities under existing contracts, grants, and cooperative agreements. The letter emphasized, “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.”

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The directive also urged implementing partners to minimize costs associated with their projects. The agency stated that no work may resume until formal written notification is received from the contracting or agreement officer.

The suspension of funding is expected to have a significant impact on Bangladesh, where USAID has been a key partner in development projects ranging from healthcare and education to infrastructure and governance.

The suspension follows a broader foreign assistance review initiated under the “America First” policy, outlined in an internal memo by US Secretary of State Marco Rubio shortly after President Donald Trump assumed office. The memo underscored a tighter control on foreign aid, with a ban on new obligations or extensions of existing assistance unless explicitly reviewed and approved.

While the stop-work order applies broadly to development and military assistance, exceptions were made for key US allies. Notably, military assistance to Israel and Egypt remains unaffected, reflecting longstanding commitments tied to security and peace agreements in the region. Emergency food assistance programs, such as those supporting crises in Sudan and Syria, were also exempt from the freeze.

The policy has far-reaching implications, affecting not only Bangladesh but also other countries reliant on US foreign aid, including Ukraine, which has been a major recipient of US military support under President Trump’s predecessor, Joe Biden. The halt in funding underscores the Trump administration’s focus on reprioritizing foreign aid expenditures in line with domestic interests.

The suspension of funding in Bangladesh is expected to pose challenges to ongoing development projects and international partnerships. While no official response from the interim government led by Muhammad Yunus has been issued yet, the move has raised concerns among local stakeholders about its impact on critical programs supporting the nation’s development goals.

As the US tightens its foreign assistance policies, the halt in funding to Bangladesh highlights the broader shift in US foreign policy priorities under the Trump administration.