Despite the flow of debt relief and grants, the pressure on the economy is becoming clear as the repayment speed increases

TDS Desk:

The pressure on the country to repay foreign debt is gradually increasing. In the first 9 months (July-March) of the current FY26, Bangladesh had to repay more than $3.5 billion in interest and principal to various development partners and countries.

At the same time, despite the flow of debt relief and grants, the pressure on the economy is becoming clear as the repayment speed increases.

The latest updated report published by the Economic Relations Division (ERD) shows that a total of $3.525 billion has been repaid during the period in question.

On the other hand, $3.89 billion in loans and grants came into the country. That is, even though there is a new flow of money, the pressure to repay debt is increasing in parallel.

According to ERD data, out of the amount repaid in these 9 months, the amount of original debt is about $2.2764 billion and interest has been paid about $1.25 billion.

At the same time, about $3.5 billion came in as loans and $380 million as grants.

Sources say that the trend of foreign debt repayment has been on the rise for the past few years.

For the first time in FY25, the total debt repayment exceeded $4 billion, which was about $4.09 billion. The previous year, the amount was $3.37 billion.

If this trend continues, it is feared that the debt repayment amount may exceed $5 billion by the end of the current fiscal.

According to the report, Russia has written off the most debt in the first 9 months of the current fiscal—about $830 million. Next is the World Bank, which has given about $760 million.

The Asian Development Bank (ADB) has given about $610 million. In addition, China has given $520 million, Japan $310 million, and India has given about $240 million.

In addition to foreign loans, borrowing from domestic sources has also increased. More than Tk100,000 crore has been borrowed from the banking system in the first 9 months of the current fiscal to meet the budget deficit.

However, after partial repayment, it currently stands at about Tk93,000 crore. As a result, pressure is increasing on debt management from both foreign and domestic sources.

In the first 9 months of FY26, the amount of new loan commitments stood at about $2.8 billion, which was about $3 billion in the same period of the previous fiscal year.

In other words, although new commitments have decreased slightly, the pressure to repay is increasing.

Economists say that this pressure has been created as the installments of loans taken in the last decade to implement large-scale development projects are now entering the repayment stage.

This trend may become stronger in the future. Therefore, they suggested emphasizing efficiency in loan management, transparency in project implementation, and strengthening sources of foreign exchange earnings.