Country's private short-term foreign loans decline again

Private sector short-term foreign loans have declined further in January this year as businesses focused on repaying existing loans rather than taking new ones.

According to Bangladesh Bank data, the short-term foreign loans declined to $11.25 billion in January from $11.79 billion in December, declining by 4.58% in just a month. The figure was $13.65 billion in June last year and $16.41 billion in December 2022.

Bankers attributed the decline in short-term loans to businesses prioritising loan repayments. They are also facing challenges in obtaining new foreign loans due to outstanding loan amounts and reduced confidence from foreign institutions.

The current economic situation, including restrictions on imports and a dollar crisis, also led businesses to reduce their activities.

However, according to the latest data of Bangladesh Bank, at the end of the July to September quarter of the 2023-24 financial year, Bangladesh's total (public and private) foreign debt decreased to $96.54 billion. At the end of the previous quarter April to June, the amount of external debt was $98.10 billion. The country's foreign debt decreased by $1.55 billion in September compared to June.