The Asian Infrastructure Investment Bank (AIIB) is set to turn up as a key development partner of Bangladesh, as it loosens the purse strings for the country's infrastructure, power and energy and sustainable river management, said officials.

Currently, multinational lenders such as the World Bank and the Asian Development Bank (ADB) top the country's borrowing outlook.

Established in 2016, the AIIB so far has financed $2.6 billion in 13 Bangladeshi projects, while the credit flow in the next two years may double, according to ERD officials.

The updated borrowing report of the the finance ministry's Economic Relations Division (ERD) shows the government expects $3.8 billion from the AIIB in the next three years. Besides, the lender has promised $2.3 billion to Bangladesh jointly with the WB in a sustainable river management project.

Top lender ADB's funding promise in 19 projects now hovers around $3.35 billion, less than AIIB's loan pledges, according to the report.

"There will be fewer flexible loans for Bangladesh after its LDC graduation in 2026. Therefore, the country should speed up the infrastructural works with the increasing AIIB credit," said Ahsan H Mansur, executive director of the Policy Research Institute of Bangladesh (PRI).

ERD officials said the AIIB will pump into $200 million in the "Multi Sector On-Lending Facility" project of the state-owned Infrastructure Development Company Limited (IDCOL).

The government and the AIIB may sign a deal in April to that end.

The project aims to promote infrastructure investment by providing long-term financing to the private sector in Bangladesh. It is aligned with Bangladesh's goal to bridge its infrastructure deficit and achieve sustainable growth, as highlighted in Bangladesh's Perspective Plan 2021-2041.