Published :
Updated :
For all latest news, follow The Financial Express Google News channel.
An already-disproportionate government debt-to-GDP ratio in Bangladesh will further rise during 2023-2025 period, according to Fitch Ratings, while the total debt buildup stands at Tk 14.5 trillion until March.
The Fitch outlook on credit ratings covers some of Asia's fast-growing emerging economies, including Bangladesh.
The global rating agency says Bangladesh, having -- BB-/Negative -- is among those markets where it anticipates the debt-GDP ratio to continue to rise through 2023 to 2025, building on increases that were already big during the pandemic.
Bangladesh's debt-to-GDP ratio widened nearly 2.0-percentage points to 32.56 per cent as of March 2023, according to Ministry of Finance data.
Domestic debt stood at Tk 9.2 trillion while external debt at Tk 5.3 trillion during the period.
The agency, however, notes that government debt rises from a relatively low base in China and Bangladesh, although this does not include China's local- government financial-vehicle debt.
Meanwhile, India's debt and interest burdens are already high relative to 'BBB'- category peers, which constrains rating of India.
"We forecast debt/GDP in 2025 will remain higher than in 2019 for roughly 80 per cent of APAC sovereigns," says a latest Fitch report on Friday.
Policy approaches prioritising growth, and government efforts to mitigate the effects of high global inflation, account partly for the modest pace of fiscal consolidation.
The report says, "APAC Sovereigns to Make Slow Progress on Fiscal Consolidation."
jasimharoon@yahoo.com