Staff Reporter :
Bangladesh has repaid $3.5b of external debt in the first 10 months (July-April) of the current 2024-25 fiscal year which is a higher volume compared to the previous year.
According to a report released on Thursday by the Economic Relations Division (ERD), the country repaid $3.507 billion to development partners during this period. By contrast, total repayments in the entire 2023-24 fiscal year amounted to $3.37 billion.
ERD officials noted that the burden of debt repayment is steadily rising, primarily because the grace periods for many large-scale loans – taken in
earlier years for mega projects and budgetary support – have now expired.
They also pointed out that elevated market-based interest rates have added to the growing repayment pressure.
ERD data shows that between July and April of FY25, Bangladesh repaid a total of $2.812 billion in principal and interest on foreign loans. This marks a 24.73% increase compared to the same period in FY24.
Principal repayments alone surged by 32.86% during this time. In the first 10 months of FY25, the government paid $2.021 billion in principal to development partners, up from $1.663 billion in the corresponding period of the previous fiscal year.
Interest payments also saw an increase, rising by 12.95% during the July-April period. Up to April FY25, interest payments stood at $1.297 billion, compared to $1.148 billion in the same period last year.
Economists have noted that many of the large loans Bangladesh secured in recent years came with stringent terms – including short repayment windows and high interest rates. With the grace periods for many of these loans having ended, the repayment obligations have now intensified.
Furthermore, within the next one to two years, the grace periods for several Russian loans tied to the Rooppur Nuclear Power Plant Project are expected to expire, which will further amplify the country’s debt repayment pressures.
