Foreign fund disbursement up, commitment down in Jul-Nov

Disbursement of foreign aid has risen in the first five months of the current fiscal year 2020-21 while new funding commitments have fallen by 34% in the same period.

From July to November of this fiscal, foreign fund release increased by 26% to $2,049.19 million compared to $1,623.35 million at the same time a year ago, according to an updated report of the Economic Relations Department (ERD).

At this time, Jica disbursed the highest amount of $714.44 million, followed by the World Bank with $414 million, Asian Development Bank with $301 million, China with $272.22 million and Russia with $168.22 million.

Till November of FY21, international support partners pledged $1,712.22 million, which was $2,598.21 million at the same time a year ago.

According to ERD officials concerned, although aid commitment is down at the beginning of the financial year, it will rise toward the end of the year.

However, as the working environment has become somewhat normal, the amount of loans promised for projects by the international support community will also rise during the rest of the financial year.

On the other hand, a large sum of credit will be available for budget support to revive the economy and buy Covid vaccines.

Sayema Haque Bidisha, research director at the South Asian Network on Economic Modeling (Sanem), told TBS the priorities of development partners have changed because of the Covid situation.

As a result, they are lending to the priority sector when it comes to giving loans, and also helping the economy recover, she added.

The Sanem official suggested that the government should approach its international support partners diplomatically in order to have their pledges realized on the ground.

"Loan proposals need to be made in the sectors the lenders are interested in," she said.

Meanwhile, in the current financial year, the government has paid around $707 million in interest and principal to various international support partners.

The amount was around $688million in the corresponding period during the last fiscal.