New Delhi. Bangladesh’s economy seems to be moving towards a deep crisis. Recent government data has revealed that the country’s government debt has reached a record high with a shocking jump of 14 percent in the last one year. The total government debt is expected to increase to Taka 21,44,340 crore (about 15.68 lakh crore Indian rupees) by June 2025, which is much higher than last year’s Taka 18,89,000 crore.
Foreign debt increases headache, domestic borrowing also unbridled
According to the new data, the foreign debt of Bangladesh is Taka 9,49,000 crore, while the domestic debt is Taka 11,95,000 crore. This sharp increase in debt has been recorded at a time when the country’s politics is going through continuous turmoil, law and order is faltering and industrial activities are facing recession.
Government’s expenditure increased and income stagnated – the gap increased dangerously.
The rising administrative costs and weak revenue collection of the Bangladesh government have widened the income-expenditure gap. In the last financial year, the loan increased by Taka 2,50,000 crore, which is one of the fastest increase so far. According to Bangladesh Bank, in FY 2025 alone, the government took additional loan of Taka 72,372 crore from banks. Experts are calling it ‘economic alarm bell’.
Growth rate falls to 3.5%, tax system is weakest
Even after the new government came to power, the economic pace of Bangladesh did not improve. The growth rate is stuck at around 3.5%, while the tax-to-GDP ratio: 7–7.5%, which is the lowest in South Asia (India: 12%). This weak tax structure has become the biggest obstacle in increasing the income of the government.
IMF on warning, debt-to-export ratio double of safe limit
The IMF had previously rated Bangladesh’s external debt as ‘medium-level risk’. Now the situation has become more serious. Bangladesh’s debt-to-export ratio has increased to 162%, which is far above the safe limit. This growth was recorded at a time when the country’s exports are showing signs of falling. Economists say that if these trends continue, Bangladesh could be headed towards serious economic instability or even bankruptcy.
