Policymakers and economic analysts have voiced concern over Bangladesh’s growing debt load, warning that the country risks slipping into a debt trap.

At a seminar in Dhaka on Monday, CPD Distinguished Fellow Mostafizur Rahman cautioned that without strong reforms, better financial discipline, and improved revenue collection, Bangladesh could face serious debt stress in the coming years.

NBR Chairman Md. Abdur Rahman Khan was even more direct, saying: “We are already caught in a debt trap, and unless we acknowledge this reality, we cannot move forward.”

The seminar was organized at the NEC Conference Room in Sher-e-Bangla Nagar for the release of “Bangladesh State of the Economy 2025” and the “SDG Progress Report 2025,” published by the General Economics Division of the Planning Commission.

The event was attended by the Chief Adviser’s Special Assistant for Economic Affairs, Anisuzzaman Chowdhury, Bangladesh Bank Governor Ahsan H. Mansur, and several senior officials and economists, including Zahid Hussain and Mahbub Ullah.

Speakers noted that debt servicing has now become one of the government’s largest expenditure items—surpassing key sectors such as agriculture and education. Mostafizur Rahman warned that mounting interest payments could push the country toward borrowing simply to repay old loans.

The NBR chief highlighted a sharp drop in the tax-to-GDP ratio—from above 10% a few years ago to around 7% now—saying that revenue collection remains weak across several sectors. He also mentioned that the NBR will soon be split into two divisions under separate secretaries as part of ongoing reforms.

Bangladesh Bank’s Governor said that the merger process of five troubled banks is moving quickly. The deposit guarantee limit has been raised from Tk 100,000 to Tk 200,000, and payouts to depositors may begin within one or two weeks.

He estimated that around 7.6 million families linked to these banks will be able to recover their deposits, and expressed hope that the new merged bank could achieve profitability within its first or second year of operation.