Dhaka, Bangladesh (BBN)- External debt servicing of the government increased by nearly US$52 million in the first quarter (Q1) of the current fiscal year (FY), 2019-2020, compared to that of the same period in the previous fiscal.
The payment for external debt service rose to $495.18 during the July-September period of FY ’20 from $443.37 million in the same period of the previous fiscal, according to official data.
On the other hand, foreign aid received by the government dropped by $56 million to $940.80 million during the period under review from $996.85 million a year ago.
Bangladesh’s external front may face trouble in the near future if such situation continues, according to experts.
Actually, the government has availed a substantial amount of buyers' credit and short-term loans over the last few years to meet the growing demand for fund. Grace period of most of the loans was 5-6 years. So, the government has to start servicing that external debt as per commitments, they explained.
However, senior officials at ERD expected that the disbursement of overseas assistances will pick up in the coming months as commitments, given by the development partners, increased by $193 million to $2.01 billion in the Q1 of FY ’20.
Development partners including the World Bank, Asian Development Bank, JICA, UKAID and Islamic Development Bank disburse concessional assistance each for the development of Bangladesh.
The government had set an ambitious target of receiving US$6.0 billion in concessional foreign assistance and commitment of $8.47 billion during the current FY.