In the first five months of the fiscal year, both commitments and disbursements of foreign aid overall decreased, although payments made by the government to development organizations, including interest and principal, increased.
Foreign assistance disbursements plummeted by 20.29% from July to November, while foreign aid commitments decreased by 88.27% year on year (YoY).
According to the Economic Relations Division's (ERD) most recent provisional figures, Bangladesh received only $461.3 million in foreign aid commitments during the first five months of FY23, down from $3.9 billion during the same period in FY22.
On the other hand, in the first five months of the fiscal year, foreign aid disbursements were $2.46 billion.
The disbursement was $3.08 billion in the same period last fiscal year.
According to ERD data, Japan provided $742.76 million in foreign aid for the first five months of the current fiscal year, which is the highest sum.
With $468.7 million, China contributed the second-highest amount of aid.
In addition, the ADB and World Bank each contributed $319.4 million.
The government has given the development agencies $880.46 million in the first five months of the fiscal year, including interest and principal.
In the same time period of the previous financial year, this sum was $868.25.
Data analysis revealed that, during July-November, other than $300 million from the World Bank (WB), no loan commitments were received from promising development partners like the Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), Japan and China.
Regarding the dip tendency economists and experts say that, during the same period of FY22, development partners had waived some funds for budget support and the purchase of vaccines in view of the Covid-19 situation.
On the other hand, many ministries and departments are still lagging behind in the allowance of foreign aid due to a lack of their capacity.
Due to those reasons, the foreign aid allowance for the current fiscal year is slightly less than in the previous fiscal year.
According to ERD sources, due to a lack of loan agreements with development partners, demand decreased from July to November.
However, several development project loans are in the process of being signed.
For example, just a few days ago the Asian Development Bank signed a loan agreement of $628 million, sources also informed.
According to the agreements, ADB will provide $278.29 million in loans for the third Public-Private Infrastructure Development facility- Tranche 2, $100 million for the Greater Dhaka Sustainable Urban Transport Project (BRT- Gazipur), $246 million for the ‘Coastal Towns Climate Resilience' project and a grant of $4 million for the 'Coastal Towns Climate Resilience' project.
However, in the current fiscal year, the government expects to realize $8.5 billion in pledges from development partners.
