---

Bangladesh received virtually no fresh foreign aid commitments from its major development partners in the first quarter of FY27, raising concerns over the country’s development financing pipeline as external debt repayment obligations continue to rise.

While major multilateral and bilateral lenders largely refrained from approving new financing, the government continued to receive funds against previously approved loans, highlighting the growing challenge of securing fresh assistance while meeting rising debt obligations.

According to provisional data from the Economic Relations Division (ERD), the World Bank, Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), China, Russia and India made no new commitments during July-September.

Japan was the only major development partner to make a new commitment, amounting to just $3.51 million during the quarter.

Overall, Bangladesh received $662.31 million in foreign assistance during the period, while total commitments stood at $1.273 billion.

Other development partners, including the Islamic Development Bank, the United Nations, UK Aid, Germany, Denmark, the Netherlands, Norway, Sweden and the United States, accounted for $1.269 billion of the total commitments.

Despite the absence of fresh commitments from most major lenders, several continued disbursing funds against existing financing agreements.

The World Bank disbursed $196.51 million during the quarter, while the Manila-based ADB released $162.11 million. India provided $104.99 million, followed by Japan with $44.66 million.

China disbursed $14.66 million and Russia $20.65 million during the same period. The AIIB neither made new commitments nor disbursed any funds.

The financing gap is becoming more concerning as Bangladesh’s external debt servicing burden increases. According to the government’s latest external financing assessment, loan repayments during the first quarter were around twice the amount received from development partners.

The distinction between commitments and disbursements is important. Commitments represent new financing agreements for development projects and programmes, while disbursements refer to the release of funds against loans approved earlier.

Analysts warn that a prolonged slowdown in fresh commitments could weaken Bangladesh’s development financing pipeline and complicate efforts to maintain public investment.

Principal and interest payments on external loans have been rising following years of substantial borrowing from bilateral and multilateral development partners. As debt servicing absorbs an increasing amount of foreign currency, securing fresh concessional financing has become important for sustaining development expenditure and easing pressure on the external sector.

The latest figures also suggest a growing reliance on development partners outside Bangladesh’s traditional group of major lenders.

A senior ERD official said foreign aid disbursements were closely linked to the implementation of development projects.

“If government agencies can implement foreign aid-supported projects on schedule, the pace of disbursement will increase,” the official said.

The official noted that project implementation usually remains slow during the first quarter of a fiscal year, but expressed hope that implementation would accelerate from the second quarter, leading to higher foreign aid disbursements.