Disbursement of foreign loan falls 14%

Although the country saw a huge year-on-year rise in the amount of foreign loans pledged from abroad in the first two months of the current fiscal year, their disbursements have slightly dropped, showed government data.

Meanwhile, debt repayment increased by 38.2 percent.

Around $73.90 crore of foreign loans was disbursed in the July-August period of fiscal year 2023-24, down 14.48 percent, according to data published by Economic Relations Division (ERD) recently.

As for the commitments, it was for $114 crore, which is a massive increase of 275 per cent. Simultaneously, Bangladesh paid back $40.05 crore to development partners.

Project approvals and implementation alongside loan processes are usually sluggish at the beginning of a new fiscal year, said sources.

Funds do not get released fast as most projects are now undergoing preparatory work, they added.

The significant increase in the commitment amount may help grow the disbursements in the coming months, they said.

Asian Development Bank (ADB) and World Bank committed to provide $79 crore and $30 crore respectively during this period.

There was no commitment from Asian Infrastructure Investment Bank, India, China and Russia in the two months, according to ERD data.

Japan released the highest amount of $30.88 crore followed by the ADB ($15.74 crore) and World Bank ($13.2 crore). Russia released $4.25 crore.