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Country’s foreign aid commitments suffered a decline of around 23 per cent compared with the corresponding period of the previous fiscal year, according to provisional data from the Economic Relations Division (ERD).
The latest Foreign Assistance Monthly Report of the ERD shows that total foreign assistance commitments stood at US$4.22 billion during July 2025-May 2026, down from US$5.48 billion recorded in the same period of FY2024-25, reports UNB.
The decline was primarily driven by a reduction in project assistance commitments.
During the reporting period, project aid commitments amounted to US$4.06 billion in loans and US$158.78 million in grants, compared with US$5.108 billion in loans and US$380.98 million in grants during the corresponding period a year earlier.
No commitments were recorded under food assistance in either fiscal year.
Despite the fall in fresh commitments, foreign aid disbursements remained substantial.
Total disbursements reached US$4.57 billion during July-May of FY2025-26, compared with US$5.60 billion in the same period of FY2024-25.
Project assistance accounted for the bulk of disbursements, amounting to US$4.53 billion, including US$4.14 billion in loans and US$393.81 million in grants.
Food assistance disbursements totalled US$40 million during the period, slightly higher than the US$35 million received in the corresponding period of the previous fiscal year.
Meanwhile, Bangladesh’s debt servicing obligations continued to rise.
According to the ERD data, the country paid US$4.13 billion in principal and interest on foreign loans during the July-May period of FY2025-26, up from US$3.78 billion in the same period of FY2024-25.
Of the total debt servicing payment, US$2.68 billion was repayment of principal and US$1.44 billion was interest.
In local currency terms, total external debt servicing reached Tk 50,515.86 crore during the period, compared with Tk 45,676.08 crore in the corresponding period of the previous fiscal year.
The increase in debt repayments reflects Bangladesh’s growing external debt obligations as several large infrastructure and development projects financed through foreign loans enter the repayment phase.
