Written by The Banking Post
Bangladesh’s repayment of foreign loans in July — the first month of FY26 — was more than double the external aid received from development partners, provisional data from the Economic Relations Division (ERD) shows.
The country paid $446.68 million against outstanding medium- to long-term loans in July, while fresh disbursements stood at just $202.75 million — including $202.44 million in loans and $0.31 million in grants.
Repayments comprised $327.72 million in principal and $118.96 million in interest. A year earlier, in July FY25, repayments had totaled $385.67 million.
ERD officials said repayments have been accelerating since FY25 as the government ramped up external borrowing in recent years, particularly for budgetary support.
Meanwhile, development partners including the World Bank, the Asian Development Bank, and Japan committed only $83.46 million in fresh assistance for July FY26, of which $82.59 million came as loans and $0.87 million as grants.
An ERD official warned that the debt burden will intensify from FY27, when repayments on the $11.38 billion Russian loans are scheduled to begin.
In FY25, Bangladesh spent nearly half of the foreign aid it received on loan servicing, repaying a record $4.09 billion against inflows of $8.11 billion, ERD data shows.
