The amount of overseas aid the country received during the July-April period of FY06 reached $ 979.11 million while it was $1112.40 million in the corresponding period of the previous fiscal.

Repayment of $393 million against previous debt to donor agencies also caused a 21 percent decline to the net foreign aid during the period. Sources added that the net foreign aid in the first 10 months of the current financial year stood at only $586.11million.

In the first six months of FY05, the government repaid $376 million principal amount. The net foreign aid was $736 million during the period.

In three of the 10 months of FY06, the government's principal amount payment was more than the amount of foreign aid it received.

Such payment was $16.70 million in July, $1.30 million in August and $2.92 million in November.

There are some factors behind the snail's pace in progress in donors-funded projects under the country's annual development programme (ADP), such as bureaucratic tangle in appointing consultants for the projects, land acquisition and delay in tendering process, the ERD sources identified.

The low foreign aid had prompted the government to

borrow from banks an amount of Tk 5000 crore in the 2005-06 fiscal, although the earlier decision was to take a Tk 3600 crore loan from banks, according to the revised budget of the year.

Sources said at present, the government has already borrowed around Tk 7000 crore from banks.

On the other hand, due to slow implementation of reform projects, the government failed to get budgetary support from the donors. As a result, the overall fiscal costs is also increasing, sources added.