Bangladesh is facing growing fiscal pressure as foreign aid inflows decline and debt repayment costs rise.

Provisional data from the Economic Relations Division shows foreign aid receipts fell in the first half of the current fiscal year. At the same time, payments on external debt increased sharply.

Debt servicing rose by 26.4 percent to $1.98 billion during July to December of FY26. In local currency terms, repayments increased by more than 37 percent to Tk 236.75 billion.

Foreign aid disbursement fell to $3.53 billion in the first half of the fiscal year.  Loan disbursements declined by nearly 16 percent to $3.26 billion.

Agreements worth $2.3 billion were signed in the first half of FY26. This was down more than 67 percent from the previous year.

The Asian Development Bank remained the largest source of disbursement. The World Bank ranked second and led in new commitments.

The government still has more than $43 billion in unused foreign funds due to slow project execution.

They said improving project implementation is important to ease fiscal pressure.