Foreign Loan, Grant Disbursements to Bangladesh Rise 26% in First Five Months of FY26

Bangladesh recorded a notable increase in foreign loan and grant disbursements during the first five months of the 2025–26 fiscal year, with inflows rising 26 per cent year-on-year, according to data released by the Economic Relations Division (ERD).

Development partners and international lenders disbursed $1.95 billion between July and November, compared to $1.54 billion during the same period of the previous fiscal year. The increase reflects improved early fiscal performance and renewed confidence among development partners following a more stable start to the current fiscal year.

However, the data also indicate that momentum is slowing. Growth in disbursements eased from 38.5 per cent recorded during the first four months, suggesting that the initial surge in foreign assistance is beginning to moderate.

The previous fiscal year had opened amid political uncertainty, which dampened several economic indicators, including foreign aid inflows. In contrast, the current fiscal year began on firmer ground, although recent trends point to a gradual easing of growth.

Meanwhile, foreign aid commitments so far this fiscal year stand at $1.22 billion, underscoring continued engagement by development partners. At the same time, external debt servicing pressures have intensified. The government repaid $1.89 billion in principal and interest during the first five months of FY26-an increase of 10.46 per cent from $1.71 billion repaid during the same period last year.

The figures highlight a dual challenge for Bangladesh: managing rising foreign inflows while coping with increasing debt repayment obligations, which continue to place pressure on the country’s external finances.