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Bangladesh’s outstanding external debt reached $113.43 billion at the end of 2025, up from $38.77 billion in 2015, according to the World Bank’s International Debt Report 2026.

The report, released from the World Bank headquarters in Washington on Thursday, showed that the country’s debt stock increased by 8.6% year-on-year in 2025, reflecting the continued expansion of borrowing to support development projects.

External financing commitments to Bangladesh also gained momentum. During the first quarter of FY2026-27 (July-September), commitments for foreign loans and grants rose to $1.27 billion, compared with $916.7 million in the same period a year earlier. The increase represents nearly 40% growth over the period.

The surge was driven largely by higher commitments from Middle Eastern countries and development partners, providing a boost to Bangladesh’s external financing pipeline.

Debt servicing climbs

Bangladesh’s external debt servicing burden continued to grow during the July-September quarter of the current fiscal year.

According to data from the Economic Relations Division (ERD), the country paid $1.35 billion in principal and interest on foreign loans during the period, up from $1.28 billion in the corresponding quarter of the previous fiscal year, marking a 5.6% increase.

Principal repayments rose to $858.9 million from $817 million a year earlier. Interest payments also increased, reaching $492.3 million, compared with $462.9 million in the same period last year.

Debt position remains manageable

Despite the steady rise in external borrowing and repayment obligations, the World Bank assessment suggests that Bangladesh’s debt position remains relatively manageable.

The country’s external debt stood at 24% of Gross National Income (GNI), up by around 6% from a year earlier. The ratio indicates that, while debt pressures are mounting, repayment capacity has also strengthened.

However, the debt servicing burden is expected to increase further in the coming years as repayment obligations begin on several large infrastructure projects. These include the Rooppur Nuclear Power Plant and the Hazrat Shahjalal International Airport Third Terminal project.

Meanwhile, repayments have already started on borrowings for the Karnaphuli Tunnel and Dhaka Metro Rail projects, adding to the country’s growing external debt obligations.

As major infrastructure investments move from implementation to repayment phases, Bangladesh is set to face a steadily rising debt servicing bill, underscoring the importance of prudent debt management and effective utilisation of external financing.