\nEconomic Correspondent \/\/<\/p>\n
Representative image. Within just five months of assuming office, the BNP government has repaid a record $2.0476 billion (204.76 crore USD) in foreign debt principal and interest.<\/p>\n
Despite the pressure of servicing the massive debt accumulated during the tenure of the previous Awami League government, the current administration has been consistently meeting these obligations.<\/p>\n
The amount repaid over the five-month period from March to July of this year stands at approximately Tk 25,163 crore in local currency.<\/p>\n
According to updated statistics from the Economic Relations Division (ERD), this marks the highest amount of foreign debt repaid within any five-month span to date.<\/p>\n
During the same period last year, foreign debt repayments totaled $1.8971 billion (or approximately Tk 23,310 crore). This indicates an increase of $150.4 million (or about Tk 1,849 crore) in debt servicing over the course of the year.<\/p>\n
ERD data reveals that between March and July of this year, $1.3524 billion was paid toward the principal and $695.2 million toward interest. On average, the government had to service foreign debt amounting to approximately $410 million per month during this period.<\/p>\n
The BNP government assumed office on February 17 following its victory in the 13th National Parliamentary Election under the leadership of Prime Minister Tarique Rahman. Since taking charge, one of the major challenges facing the government has been the repayment of mounting installments on foreign loans secured by the previous administration. However, despite economic pressures and various challenges, the government has maintained a consistent track record of foreign debt repayment.<\/p>\n
According to government policymakers, the installments for the massive foreign loans taken by the previous Awami League government\u2014ostensibly for large infrastructure and mega-projects\u2014have now fallen due. As the grace periods for a significant portion of these loans have expired, the pressure to repay both principal and interest has intensified considerably during the current government’s tenure.<\/p>\n
Rashed Al Mahmud Titumir, the Prime Minister’s Advisor on Finance and Planning, stated that between 2009 and 2024, the Awami League government borrowed heavily for infrastructure and mega-projects. However, factors such as ‘value for money’ (expected returns relative to cost) and interest rates were not adequately considered at the time these loans were secured. He stated that the power sector has also accumulated a massive financial burden and subsidy load due to various factors, including capacity charges. The current government is now compelled to manage these liabilities left behind by the previous administration.<\/p>\n
Titumir said, “We inherited a fragile economy. Nevertheless, the government is prioritizing the regular repayment of these obligations.”<\/p>\n
Noting that the previous government had indiscriminately incurred debt\u2014thereby saddling future generations with a heavy burden\u2014Adviser Titumir stated that the current government has adopted a highly cautious stance regarding the acquisition of any domestic or foreign loans.<\/p>\n
He added, “We are emphasizing the use of loans to boost dynamism in investment, particularly within the manufacturing sector. Decisions are made only after considering the expected returns and the potential for job creation associated with the loans.”<\/p>\n
The current government’s debt policy prioritizes not merely raising funds, but also determining where the borrowed money will be spent and assessing the economic benefits likely to be derived from such investments.<\/p>\n
According to ERD data, the pressure to repay foreign loans has steadily intensified in recent years.<\/p>\n
Foreign loan repayments stood at $2.67 billion in the 2022-23 fiscal year. This figure rose to $3.37 billion in 2023-24 and reached $4.09 billion in 2024-25.<\/p>\n
For the 2025-26 fiscal year, the amount is projected to rise further to $4.49 billion\u2014an increase of approximately 10 percent compared to the previous fiscal year.<\/p>\n
These figures indicate that the current pressure to repay foreign loans stems not primarily from recent borrowing, but rather from the fact that installments on large-scale project loans secured in earlier years have now fallen due.<\/p>\n
The grace periods for many of the major infrastructure and mega-projects undertaken over the past decade and a half have expired. Consequently, the pressure to repay both principal and interest simultaneously has mounted.<\/p>\n
In this context, the current government is regularly servicing the debt liabilities inherited from the previous administration while simultaneously evaluating the actual necessity, economic viability, expected investment returns, and future repayment capacity before undertaking any new loans. Government policymakers believe that by regularly repaying loans, it is possible to maintain the country’s financial credibility and its capacity to meet obligations to international development partners and creditors.<\/p>\n
Read the news and share your opinion.<\/p>\n","protected":false},"excerpt":{"rendered":"
Economic Correspondent \/\/ Representative image. Within just five months of assuming office, the BNP government has repaid a record $2.0476 billion (204.76 crore USD) in foreign debt principal and interest. Despite the pressure of servicing the massive debt accumulated during the tenure of the previous Awami League government, the current administration has been consistently meeting these obligations. The amount repaid over the five-month period from March to July of this year stands at approximately Tk 25,163 crore in local currency. According to updated statistics from the Economic Relations Division (ERD),<\/p>\n","protected":false},"author":1,"featured_media":8499,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31,22],"tags":[],"class_list":["post-8498","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-economy","category-top-news"],"_links":{"self":[{"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=\/wp\/v2\/posts\/8498","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=8498"}],"version-history":[{"count":1,"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=\/wp\/v2\/posts\/8498\/revisions"}],"predecessor-version":[{"id":8500,"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=\/wp\/v2\/posts\/8498\/revisions\/8500"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=\/wp\/v2\/media\/8499"}],"wp:attachment":[{"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8498"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8498"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thedailymorningsun.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8498"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}