Government Repays Record Amount of Foreign Debt
The government repaid a record $2.047 billion in principal and interest on foreign loans in the five months since taking office. The amount is equivalent to around Tk 25,163 crore. Despite mounting pressure from the huge volume of foreign loans taken by the previous government, the government has been regularly servicing the debt.
According to updated statistics from the Economic Relations Division (ERD), this is the highest-ever amount of foreign debt repaid over any five-month period. During the same period last year, the amount was $1.8971 billion, or around Tk 23,310 crore. As a result, debt repayments increased by $150.4 million, or around Tk 1,849 crore, year-on-year.
According to ERD data, the government had to repay an average of around $410 million per month during the five months from March to July this year. Of the total, $1.3524 billion was paid toward principal and $695.2 million in interest.
ERD statistics show that the pressure of debt repayment has steadily increased in recent years. Repayments stood at $2.67 billion in fiscal year 2022–23, rising to $3.37 billion in 2023–24 and $4.09 billion in 2024–25. The figure increased further to $4.49 billion in 2025–26, up 10 percent from the previous year.
ERD officials said the repayment pressure has increased as the grace periods for mega projects undertaken over the past 15 years have expired, creating pressure to repay both principal and interest simultaneously.
Finance and Planning Adviser Rashed Al Mahmud Titumir said many of the loans taken by the previous government between 2009 and 2024 lacked sound policy and economic justification. Despite inheriting a fragile economy, the current government is prioritizing the repayment of these substantial liabilities to maintain the country’s financial acceptance and credibility among international development partners.
He further said the current government is adopting an extremely cautious strategy when taking on either domestic or foreign loans. From now on, no new debt will be undertaken unless a project’s genuine necessity, employment generation potential, and economic returns are ensured.
