Foreign fund receipts in H1 down to $3.53b

Foreign-aid disbursement to Bangladesh dropped US$3.53 billion in the first half of the current fiscal year as all its development partners ramped down bankrolling its uplift recipe, official statistics show.

Of the amount received in the July-December period, $3.26 billion came as loans and $270.64 million as grants, according to the provisional data available with the Economic Relations Division (ERD).

The country received $4.06 billion in the period of the last fiscal year, which reflects a 13.08-percent decline in the inflow of foreign resources, with an actual drop of $531.38 million.

The ERD published its monthly report on disbursement of foreign resources on Sunday which also found a 67.11-percent drop in new commitment of funding by the development partners.

However, the cost for serving debts taken previously increased by 26.40 per cent in the first half of the current fiscal year in terms of USD, while it jumped by 37.32 per cent in terms of the domestic currency, taka.

"Commitment and disbursement in the first five months of the fiscal year were almost stagnant and started accelerating in December as several loan agreements were inked in December with the World Bank, the Asian Development Bank (ADB) and the Asian Infrastructure Investment Bank (AIIB), and disbursement of amount over $1.1 billion as budget support," said a high official of the ERD.

The document reveals that the development partners disbursed $3.26 billion as loans in the July- December period, which is 15.97-percent lower than the loan disbursement in the first half of the previous fiscal, 3.88 billion.

On the other hand, the disbursement of foreign grants increased by 48.54 per cent, from $182.2 million of the last fiscal to $270.64 million in the current fiscal.

The ERD received commitment of new aid worth $2.3 billion in the last six months, 67.11-percent lower than the H1 commitment of the previous fiscal worth 6.99 billion.

Commitment of new loans dropped drastically by 69.47 per cent and got reduced by 29.30 per cent for new grants.

The debt-servicing costs increased by 26.40 per cent to $1.98 billion in the first half of the current fiscal from $414 million in the previous fiscal.

The debt serving in terms of the domestic currency reached Tk 236.75 billion, which was Tk 172.41 billion in the last fiscal.

Several factors, including the rise in interest rate and pressure on exchange rate, pushed to increase debt-serve cost by Tk 64.35 billion in six months, 37.32-percent higher than the previous fiscal.

The ADB ranked first among all of the development partners in terms of disbursement with a fund worth $ 1.05 billion. The World Bank ranked second with disbursement of $801 million, while Russia ranked third handing out $532 million.

However, the World Bank ranked first in commitment with the signing of deals worth $914.50 million. The ADB committed second-highest $700 million and Japan committed third-highest $252 million.

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