Staff Correspondent:

Bangladesh’s foreign debt repayment has exceeded $4 billion (400 crore dollars) for the first time.

In the outgoing fiscal year (2024-25), the country paid back approximately $4.09 billion (409 crore dollars), including interest, on foreign loans.

This is a record high. Never before has such a large sum been repaid in a single year. In the previous fiscal, repayments had amounted to $3.37 billion (337 crore).

These figures were obtained from the latest data of the Economic Relations Division (ERD) on foreign loan commitments, disbursements, and debt servicing.

Officials say that Bangladesh’s foreign debt burden is steadily increasing, posing a new challenge for the economy.

According to ERD sources, in the June-July period, Bangladesh repaid $4.0869 billion (408 crore 69 lakh dollars) in foreign loan principal and interest, meaning the country had to pay more than $340 million (34 crore dollars) on average each month.

The latest ERD report says, of the total government expenditure from July to June of the last fiscal, $2.59 billion (258 crore dollars) was paid as loan principal, and $1.49 billion (149 crore) as interest.

Meanwhile, although foreign debt repayment has increased, both loan disbursement and loan commitments have declined.

In the first 11 months of the current fiscal, foreign loan disbursement amounted to $5.6 billion (560 crore dollars), compared to $7.02 billion (702 crore dollars) during the corresponding period of the previous fiscal.

Loan commitments in the same period amounted to $5.48 billion (548 crore dollars), while the figure was $7.92 billion (792 crore dollars) in the corresponding period last year.

In the previous fiscal, the total loan disbursement stood at $8.57 billion (857 crore dollars). Commitments stood at $8.32 billion (832 crore dollars).

The Asian Development Bank (ADB) topped the list of lenders, disbursing $2.52 billion (252 crore dollars) during the July-June period of the current fiscal year. It was followed by the World Bank and Japan. However, while funds were disbursed, India, China, and Russia made no new loan commitments in the current fiscal year. Foreign debt repayment nearly quadrupled in a decade

Over the past several years, foreign debt repayment by Bangladesh has increased significantly.

According to ERD sources, in the 2012-13 fiscal year, Bangladesh repaid a total of $1.1 billion (110 crore dollars) in foreign loans.

Almost a decade later, in 2021-22, this amount rose to $2.01 billion (201 crore dollars).

In 2022-23, it climbed to nearly $3 billion (300 crore dollars). In the just-concluded 2024-25 fiscal, Bangladesh had to repay $4.09 billion (409 crore dollars) in foreign loans, nearly a fourfold increase over the past 12 years.

The burden of debt repayments is expected to increase further in the coming years, as repayment of principal and interest on several major projects is set to begin.

For example, repayments for loans used to build the Rooppur Nuclear Power Plant and the Third Terminal of Hazrat Shahjalal International Airport will begin soon.

These repayments are due to Japan. Meanwhile, repayments have already begun for loans used in the Karnaphuli River Tunnel and Metro Rail projects.

According to ERD officials, the pressure of foreign debt repayment is mounting as the grace periods for many large mega projects have come to an end.