Bangladesh’s external debt climbed 8.6 percent to $113.4 billion in 2025, according to the World Bank’s International Debt Report 2026. The report said the country nonetheless kept its debt-to-gross national income and debt-service ratios at manageable levels, even as the broader global financing environment tightened. dhakatribune
The increase underlines the country’s continued reliance on foreign financing at a time when developing economies are facing heavier repayment obligations and more expensive borrowing.
What Makes Up Bangladesh’s External Debt
The World Bank’s breakdown shows that most of the obligations are owed by the public sector. Long-term public and publicly guaranteed debt reached $89.5 billion, accounting for nearly four-fifths of the total. The remainder consists of $9.9 billion in private nonguaranteed debt and $14.1 billion in short-term borrowing. dhakatribune
Multilateral institutions are the dominant lenders within the public category. They hold $51.1 billion, driven mainly by the World Bank’s International Development Association with $22.6 billion and the Asian Development Bank with $17.5 billion. Bilateral creditors account for a further $32.6 billion, led by Japan with $12.7 billion and the Russian Federation with $9.0 billion. dhakatribune
This composition matters because concessional lending from multilateral institutions generally carries longer maturities and lower interest costs than commercial credit. A debt stock weighted towards such lenders is typically easier to service than one built on bond issuance or private bank loans.
How the Latest Figures Compare With Earlier Reports
The 2025 figure continues an upward trend that earlier World Bank reporting had already identified. The previous edition showed that Bangladesh’s total external debt stood at $104.48 billion at the end of 2024, up from $73.55 billion in 2020, a rise of 42 percent over five years. The same report noted that external debt amounted to 192 percent of export earnings in 2024 and that debt service absorbed 16 percent of exports. tbsnews
Those earlier findings prompted warnings from economists about repayment pressure. The latest data suggest that the headline stock has continued to grow, although the International Debt Report 2026 describes the country’s ratios relative to income and debt service as manageable.
Bangladesh’s External Debt in a Regional and Global Context
The report places the figure within a wider South Asian picture. Total external debt across the region reached $955 billion in 2025, although its average ratio of debt to gross national income remained relatively contained at 21 percent. This suggests that Bangladesh’s position, while rising, sits within a regional pattern rather than standing apart from it. dhakatribune
Globally, the findings are more sobering. The World Bank said the external debt of developing countries jumped 5.5 percent to a record $9.4 trillion in 2025, the fastest pace since 2021 and about four times the average recorded between 2022 and 2024. Borrowing by developing countries from private creditors and bond issuance by public entities rose nearly 35 percent to $251 billion, the highest level in five years. worldbankcnbcafrica
Costs of servicing remain heavy. Payments to bondholders climbed to $363 billion, and between 2022 and 2025 developing countries paid $436 billion more in debt service than they received in new financing. The direction shifted slightly in 2025, when long-term debt flows turned from a net outflow of $118 billion in 2024 to a net inflow of $45 billion. worldbank
Poorest Economies Bear the Greatest Strain
The International Debt Report 2026 pays particular attention to countries eligible for concessional financing from the International Development Association, the group to which Bangladesh has historically belonged as a major borrower. External debt in these countries grew fastest, rising 8.1 percent to $1.3 trillion in 2025. cnbcafrica
The World Bank warned that higher debt service costs could crowd out essential spending on education, infrastructure, health and jobs. For Bangladesh, where large infrastructure projects have been financed through foreign loans, that concern is directly relevant, since repayment obligations compete with development spending in the national budget.
Outlook for Policymakers
The findings do not describe a country in acute distress. The share of public and publicly guaranteed debt held by multilateral lenders, together with the reported manageability of debt-to-income and debt-service ratios, offers some reassurance. Even so, the direction of travel is clear. Bangladesh’s external debt has risen year after year, and the cost of new borrowing in global markets remains elevated.
Maintaining export growth, protecting foreign exchange earnings and favouring concessional financing will therefore remain central to keeping repayment pressure in check. The International Debt Report 2026 offers both a reassuring snapshot and a reminder that the trend will need careful management in the years ahead.
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