The government's payment of interest on account of servicing its debts, both domestic and foreign, has marked a significant rise in the proposed budget for fiscal year 2020-21.
A total of Tk 637.99 billion has been earmarked for the payment of interest against its debts for the upcoming fiscal, according to the budget documents.
The amount is over 10 per cent higher than Tk 576.63 billion estimated in the revised budget of FY 2019-20.
Of Tk 637.99 billion earmarked for FY '21, a sum of Tk 582.51 billion has been projected to be paid in interest for servicing domestic debts and Tk 55.48 billion for foreign debts.
The figures were Tk 527.95 billion and Tk 48.88 billion in the revised budget of the FY '20.
Such a significant rise in the proposed interest payment is mainly due to a substantial increase in the government's borrowing target both from internal and external sources, according to the budget documents.
The government has set a target of borrowing around Tk 1.10 trillion from domestic sources in the next fiscal, up by Tk 126.38 billion from the revised amount of borrowing in FY '20.