Bangladesh paid more in foreign debt servicing than it received in new external loans during the first seven months of the current fiscal year (FY2025–26), marking a notable shift in the country’s external financing trend.
According to the latest report from the Economic Relations Division (ERD), released on Thursday, development partners disbursed $2.641 billion between July and January.
During the same period, Bangladesh repaid $2.676 billion in principal and interest on previously taken loans. This means repayments exceeded disbursements by around $35 million—the first time such a gap has been recorded.
The data also show a sharp decline in loan inflows. Disbursements dropped by 32.39 percent compared to the same period last fiscal year, when Bangladesh received $3.938 billion.
In contrast, debt repayments increased by about 10 percent. In the first seven months of the previous fiscal year, repayments stood at $2.418 billion.
Commitments Also Decline
The report indicates a slight fall in fresh loan commitments as well. Between July and January, Bangladesh secured $2.274 billion in new loan agreements, down 3.26 percent from $2.350 billion in the same period last year.
Officials say last year’s political unrest, including mass protests and administrative instability, slowed the pace of commitments from development partners. However, the situation is expected to improve following the formation of an elected government.
ADB Leads in Commitments, Russia Tops Disbursement
Among development partners, the Asian Development Bank (ADB) provided the highest loan commitment during the period, pledging $1.269 billion. The World Bank followed with $265 million.
No new commitments came from the Asian Infrastructure Investment Bank (AIIB), Japan, India, China or Russia during the period.
However, in terms of actual disbursement, Russia led with $576 million. The ADB disbursed $536 million, the World Bank $555 million, China $220 million, and Japan $183 million.
The latest figures highlight growing pressure on Bangladesh’s external financing, as repayments rise while fresh inflows slow.