Finance Minister Amir Khosru Mahmud Chowdhury has said Bangladesh's total external debt stood at $78.22 billion as of March this year, warning that the country's debt servicing obligations are about to increase in the coming years.
The minister disclosed the information during the question-and-answer session in parliament today (24 June), in response to a written question from Jamaalpur-3 lawmaker Mostafizur Rahman Babul.
According to the minister, Bangladesh's total external debt amounted to $78.22 billion, of which 61.97% was concessional borrowing and 38.03% was non-concessional debt.
Highlighting key challenges in external debt management, Khosru said Bangladesh's access to highly concessional financing has gradually declined since its transition from a low-income to a lower-middle-income country, according to the World Bank's 2015 assessment.
At the same time, the volume of foreign borrowing has increased significantly over the years, resulting in a growing burden of principal and interest repayments in the future, he added.
The finance minister said the government has adopted a number of precautionary measures to ensure sustainable debt management. "Proposals for new foreign loans and related development projects are being scrutinised more rigorously to avoid financing unnecessary or low-priority projects through high-interest external borrowing."
"Only projects with high economic returns are being considered for foreign financing," he told parliament.
Khosru also informed that the government has intensified monitoring of foreign-funded projects to curb the long-standing practice of project delays and cost overruns.
In addition, the government is updating its Medium-Term Debt Management Strategy (MTDS) and conducting a Debt Sustainability Analysis (DSA) to strengthen the resilience and sustainability of public debt management, he said.
The minister further said work will soon begin on a broader plan for institutional and legal reforms aimed at improving the overall quality and effectiveness of the country's debt management framework.
Finance Minister Amir Khosru Mahmud Chowdhury / External debt
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