Bangladesh’s external debt climbed in the final quarter of the 2024–25 fiscal year, driven largely by government borrowing, while private sector debt fell slightly, central bank figures show.

Total foreign debt stood at $112.15bn at the end of June 2025, up 7% from $104.80bn in March, according to Bangladesh Bank.

Government debt rose 9% over the three months to $92.37bn, reflecting continued borrowing from multilateral and bilateral lenders such as the World Bank and Asian Development Bank. These loans are typically long-term, disbursed gradually as projects progress.

Debt held by other public corporations also increased, reaching $12.18bn in June from $11.30bn in March.

In contrast, private sector foreign borrowing dipped by 1% to $19.77bn. Economists link the decline to subdued demand, with private credit growth slowing to 6.49% in June—well below the central bank’s usual double-digit target.

Bangladesh Bank data also indicates that public corporations have relied less on short-term external loans over the past year, while long-term borrowing has edged higher.

The shift underscores the growing reliance on public financing to support development projects, even as private enterprises remain cautious amid weak credit appetite.