Foreign aid inflow drops 30% in Q1

The foreign aid inflow has declined by 30 per cent to $1349.25 million in the first quarter of FY23 when compared year-on-year.

The major international development partners released $1349.25 million worth of loans and grants in Jul-Sep of FY23, which was $1938.05.93 million in the same period a year ago, according to the latest data from the Economic Relations Division (ERD).

Of the total foreign aid disbursement, the development partners disbursed $1298.02 million in loans and $51.23 million in grants, the ERD data showed.

In the same period of previous fiscal year, the government received $1862.92 million in loans and $75.13 million in grants from the lenders.

The country also received a significant amount of foreign aid commitment to the tune of $405.40 million in loans and grants in July-September of this fiscal, the ERD data said, adding that the figure of commitment was $94.03 million in the same period of FY22.

Meanwhile, Bangladesh received record over $10 billion foreign aid from the lenders in the FY 22.

A senior official of ERD told The Business Post that the foreign aid disbursement has declined as funds are in pipeline. The disbursement will increase further, he said, adding that the disbursement has increased than the commitment. The official also said loan disbursement pace will increase further riding on better implementation during the remaining period of this fiscal year. 

“The bilateral and multilateral development partners like the Asian Development Bank, the World Bank, Japan International Cooperation Agency, China and India provide concessional loans every year for the development of Bangladesh,” he also said.

“We have received record foreign aid in the last fiscal year. The government is in a comfortable situation as development partners are disbursing funds for completing the ongoing development projects in the country,” he added.

The Asian Development Bank disbursed $167.98 million, Japan $459.33 million and the World Bank released $192.13 million in the first quarter.

Besides, Russia disbursed $74.68 million, China $274.79 million, Asian Infrastructure Investment Bank (AIIB) $2.23 million, India $101.59 million and others disbursed $76.52 million in the July-September period of FY 23.

In July-September, the government repaid $525.61 million to the development partners. The amount was $593.86 million during the corresponding period last year.

Of the figure, the government repaid $388.58 million as principal of the outstanding loans while $137.03 million as interest in first quarter of the fiscal year.

The government paid $419.85 million as the principal of the outstanding loans while $174.01 million as interest on the same period in the last fiscal year.