First 5 Months of FY26: Foreign loan pledges surge 133pc to $1.219b

Staff Reporter:

Bangladesh’s foreign loan commitments from development partners have surged sharply in the first five months of the current fiscal year 2025–26, rising by 133percent compared to the same period a year earlier.

According to an updated report released by the Economic Relations Division (ERD) on Monday, the government signed new loan agreements or received pledges worth about $1.219 billion between July and November of FY26.

In contrast, foreign loan commitments during the corresponding period of the previous fiscal year stood at just $522.68 million.

ERD officials attributed last year’s low commitment levels to political upheaval, including a mass uprising, the fall of the government, administrative disruptions and a resulting loss of confidence among development partners.

They said the recent improvement in the overall situation has helped restore confidence, leading to a strong rebound in new commitments.

ERD sources also noted an increase in foreign loan disbursements during the July–November period compared to the same timeframe last year. Development partners disbursed a total of $1.94 billion during these five months.

At the same time, Bangladesh’s repayments nearly matched the inflows.

During the July– November period of the current fiscal year, the country paid around $1.89 billion in principal and interest on external loans, almost equal to the amount disbursed.
Officials said the figures indicate a stabilising trend in external financing, with renewed engagement from development partners alongside continued pressure from debt servicing obligations.