Foreign aid in decline, new pressure on BoP
In the first five months of the current fiscal year, foreign aid decreased by 33 percent putting additional pressure on the country's balance of payments (BoP).
During the July to November period, Bangladesh received $413 million in foreign aid, down from $618 million in the same period of the previous year, according to data from the Economic Relations Division.
A complex situation has arisen as the foreign aid receipt has fallen but repayment has risen, taking net foreign aid down to only $5 million in the first five months of the current fiscal year. Net foreign aid in the first five months of the previous fiscal year was $250 million.
An ERD official said foreign aid was not released for a number of projects, including the Padma Bridge project. Besides, the government failed to get any foreign aid as budget support, he added.
BoP and foreign currency reserves are under increasing pressure, apart from spiralling import costs and low foreign-aid receipt, a high official of the finance ministry said.
Foreign currency reserves dropped by about $1.5 billion to $9.35 billion on December 13, according to data from Bangladesh.