Major dev partners follow 'wait and watch' policy amid political transition

At least five key development partners of Bangladesh fid not make any foreign- aid commitment in the first quarter of this fiscal year, as they seem waiting for the next elected government, insiders said Friday, as post-uprising transition is underway.

In addition, Bangladesh's largest development financier-the World Bank-- has also confirmed a nominal dollop worth US$12.44 million of aid during July-September quarter (Q1) of the current fiscal year (FY) 2025-26, Economic Relations Division (ERD) officials said.

Japan, China, India, the Asian Infrastructure Investment Bank (AIIB) and Russia made not a single aid commitment in the quarter, ERD data showed.

"We do not know about the silence of the development partners. Since the government has given an election roadmap, they are waiting for the next elected government," says a senior ERD official.

Japan, Bangladesh's largest bilateral development partner, has not made any aid commitment. However, Tokyo has disbursed $40.67 million worth of foreign assistance against the previously- committed funds.

The second-largest bilateral DP, China, has also neither made any aid commitment nor disbursed any single penny during the period.

The Shanghai-based donor agency-AIIB-- made no fund commitment during the Q1 of the FY2026. It provided $0.40 million worth of loan the three months.

India and Russia paused to confirm any funds during the first quarter of the current fiscal.

However, India disbursed $62.83 million in loan while Russia $315.39 million during July-Sept against their aid commitments in the past, ERD data showed.

Meanwhile, only the country's second-largest lender-the Asian Development Bank (ADB)-made a commitment of a handsome amount of $481.71 million--more than half the total $910.67 million worth of aid commitment in the FY2026Q1.

According to the ERD statistics, the lenders altogether made aid commitments worth $910.67 million during July-September.

However, between July and September, the government secured higher commitments of $911 million compared to just $27 million during the same period a year earlier, according to the official data.

Of the total, about $482 million came from the Asian Development Bank and $12.4 million from the World Bank, while the rest was committed by various bilateral development partners.

Meanwhile, all development partners combined made a payout of $1.148 billion during the Q1 this FY2026, which was lower than the repayment of loans made by the country.

The government spent $1.27 billion on debt service against the total debt-overhang, which accounts for $131.36-million lower than the disbursement.

Earlier in the last two consecutive fiscal years-FY2024 and FY2025, Bangladesh had not received any fresh commitments of aid from its three important bilateral development partners-China, India and Russia, official data showed.

"Despite making the repeated appeals for supports by Bangladesh government to the three donors, especially to China, over the last couple of years against necessary and priority development projects, they had not entered into any aid deal for the pipeline projects," says the senior ERD official.

Such empty aid commitments from three important lenders had weighed down the volume of overall aid pledges from multilateral and bilateral development partners (DPs) by $2.415 billion to $8.32 billion in the last FY2025, official figures showed.

The disbursement of foreign aid also saw a downtrend in the FY2025 with $8.568 billion received, $1.715 billion down from that of the FY2024.

According to the ERD, China not made any fresh pledge for aid during the last 24 months-- from July 2023 to June 2025, although Bangladesh government had made appeal on several occasions for loans and grants.

In the last fiscal year, China disbursed $ 414.70 million worth of assistance but it had not confirmed any fresh loan for the pipeline projects, officials said, adding that the country had not made any aid commitment also in the FY2024.

Economist Dr Masrur Reaz says since the election is going to be held in February, so many development partners might be waiting for the next elected government to take office to end the post-uprising interregnum.

"Besides, the aid commitment has so far not been furnished by some DPs as this interim government was cautious in borrowing non-concessional loan from the lenders like China and Russia," he told The Financial Express.

He pointed out poor Annual Development Programme (ADP) implementation rate and strained relations with a particular bilateral donor for the ebbing aid tide.