Foreign aid use jumps 64% in July-August

Bangladesh used $750 million in foreign aid during the first two months of the current fiscal year, a 64 percent rise compared to the same period last year, according to data released by the Economic Relations Division (ERD).

Officials said the sharp increase came after a period of disruption caused by nationwide protests. The student-led movement severely hampered regular administrative work in the July-August period last year.

"This year, with political stability and normalcy prevailing, foreign aid utilisation has significantly improved," said an ERD official.

Among the development partners, Russia provided the highest amount at $315.40 million, followed by the World Bank with $254 million and the Asian Development Bank (ADB) with $99.12 million.

Japan gave $20.70 million and India $20.95 million in the first two months of fiscal year 2025-26. No money was released from China during the period.

During the period, new aid commitments surged twelvefold and reached $244 million, compared to just $20 million a year earlier. Of this total, $150 million came from a single ADB loan agreement.

Meanwhile, external debt servicing also went up.

The government repaid $667.11 million in July and August, a 13.24 percent rise from $589.22 million paid in the same period last year.

Of the total, $488.79 million was principal and $178.32 million interest, up from $415.62 million and $173.60 million respectively a year earlier.

Repayments in local currency grew faster than those in US dollars.

Payments of principal and interest came to Tk 8,131 crore in the two-month period, a 17 percent increase on the previous year.