By December 2025, Bangladesh’s total external debt reached $113.51 billion (about Tk 13.96 lakh crore). Three months earlier, in September, it stood at $112.21 billion, while at the end of June it was slightly higher at $113.58 billion—indicating a decline compared to June but an increase from September.

According to a report by Bangladesh Bank, both public and private sector borrowing rose during the October–December quarter, with most of the debt being long-term.

Debt composition

Around 82% of the total external debt belongs to the public sector, while the rest is owed by private businesses. By December, public sector debt reached $93.46 billion, and private sector debt stood at $20.05 billion.

Of the total debt, 87.62% is long-term and 12.38% is short-term. Within public borrowing, $80.94 billion was taken directly by the government, while $12.52 billion came from institutions such as the central bank, state-owned banks, and other public entities.

Private sector trend

Private sector foreign borrowing had been declining for three consecutive quarters from March to September 2025. However, it rebounded in the final quarter, exceeding $20 billion again. Short-term private debt totaled $10.18 billion, including $6.06 billion in trade credit, while long-term debt stood at $9.87 billion.

Rising repayment pressure

Officials from Bangladesh Bank noted that loans from institutions like the International Monetary Fund and the World Bank were taken to ease the dollar shortage during the interim government period. Earlier loans under previous administrations were largely used for development projects that have not yet generated foreign currency earnings.

As a result, repayment pressure is increasing. Both the government and private sector will need to rely on remittances and export income to meet obligations.

More repayments than inflows

In the first seven months (July–January) of the 2025–26 fiscal year, Bangladesh received $2.64 billion in foreign loans and grants but repaid $2.67 billion—meaning outflows exceeded inflows. Debt servicing pressure has been rising in recent years, with over $4 billion repaid in the previous fiscal year alone.

Background and trends

External debt has grown significantly over time—from $20.65 billion in 2007 to $104.76 billion by 2024. It further increased to $113.51 billion in 2025 amid efforts to manage the dollar crisis.

The situation worsened after the Russia-Ukraine War, which drove up the US dollar exchange rate in Bangladesh from around Tk 85 to Tk 123, fueling inflation and economic pressure. While earlier measures such as import controls and increased borrowing could not fully stabilize reserves, the interim government has since managed to slow the decline and bring some stability to the exchange rate.