Published :
Updated :
For all latest news, follow The Financial Express Google News channel.
The country's total debt consisting of domestic and external surged by approximately 18 per cent to nearly Tk 20 trillion over the past one year ending in March 2025, according to a report of the Finance Division.
The total domestic debt as of March 2025 stood at Tk 11.58 trillion while external debt at Tk 8.42 trillion, the report said.
In the meantime, the debt-to-GDP ratio rose to over 36 per cent, an increase of 2.22 percentage points from March 2024.
Although the debt level is not too high but the country's poor resource mobilisation might pose a threat for debt servicing.
The interest expenses during the period stood at Tk 824.76 billion, domestic interest expense was Tk 681.67 billion while external interest expense was Tk143.01 billion, the report said.
The report, however, said that domestic debt constitutes the major share of the total debt stock and financing from domestic sources is increasing gradually.
The report said that Bangladesh's external debt-to-GDP ratio is still considered moderate compared to some other developing countries.
"Bangladesh is still within the IMF's "safe zone," the report states.
Bit it said that the shift towards less concessional loans and the existing macroeconomic challenges might pose threat for debt sustainability.
It suggests prudent debt management, careful selection of new projects, improved project execution and robust domestic resource mobilisation to ensure long-term debt sustainability.
As of March 31, 2025, domestic and external debt was 58 per cent and 42 per cent of the total debt stock, respectively, the report added.
The distribution of domestic and external debt over the years suggests a preference for domestic borrowing, the report reads.
It also reads the government plans to focus on deepening the domestic debt market to reduce foreign currency exposure risk.
"Financing from the banking sector constitutes 63 per cent of the total domestic debt followed by NSCs, 30 per cent, and the rest were financed from the GPF (general provident fund)".
It noted that the reforms conducted in the saving certificate regime are gradually reducing fiscal pressure and promoting a balanced debt portfolio.
Of the banking sources, some 77 per cent of the financing came through treasury bonds while 20 per cent from treasury bills.
The increasing borrowing from the treasury bills and bonds helped the yield curve rise upwards during the period.
jasimharoon@yahoo.com