Dhaka:Foreign project aid disbursement in Bangladesh saw a significant decline by more than 60 percent year-on-year, totaling $294.56 million in the first two months of the current fiscal year. This data was reported by the Economic Relations Division (ERD).
According to United News of Bangladesh, the ERD's Foreign Assistance Monthly Report for FY2026-27 revealed that Bangladesh received $294.56 million in project assistance during July-August, a sharp decrease from the $750.07 million received in the same period of FY2025-26.
The disbursed amount for the latest period consisted of $291.37 million in loans and $3.19 million in grants, compared to $746.16 million in loans and $3.91 million in grants from the previous year. Among the key contributors, the Asian Development Bank provided $128.72 million, while the International Development Association contributed $73.96 million. Japan, India, and Russia contributed $39.04 million, $30.30 million, and $20.65 million, respectively, with other partners accounting for $1.89 million.
During the same period, foreign assistance commitments stood at $240.39 million, slightly below the $243.81 million from the previous fiscal year. These commitments included $143.28 million in loans and $97.11 million in grants. A notable portion of the commitments, $236.88 million, was from development partners classified outside the major contributors such as ADB, IDA, AIIB, India, China, and Russia, with Japan committing $3.51 million.
Additionally, external debt servicing increased by nearly 4.8 percent year-on-year, with Bangladesh paying $698.92 million in July-August 2026, compared to $667.11 million in the corresponding period of FY2025-26. This increase of $31.81 million included $516.04 million in principal and $182.88 million in interest payments. In the same period last fiscal year, principal repayment was $488.79 million and interest payment was $178.32 million.
In terms of local currency, total debt servicing costs rose to Tk 8,626.25 crore in July-August from Tk 8,130.87 crore in the same timeframe of FY2025-26, marking an increase of Tk495.38 crore. Principal repayment increased to Tk 6,368.85 crore from Tk 5,957.50 crore, while interest payments grew to Tk 2,257.40 crore from Tk 2,173.37 crore.
This rise in debt servicing occurred as foreign project assistance saw a significant decline, as noted by the ERD's Foreign Aid Budget and Accounts (FABA) wing. The figures reported are provisional for the July-August period of FY2026-27.