Archive · 9 Dec 2025
Bangladesh Faces Debt Crisis, Rising Default Loans
Bangladesh is in a tough spot with money problems.
The country has to spend a lot on paying back its debts, which is now the second-biggest expense in its budget.
The money it collects from taxes has also gone down a lot.
This is making it hard for Bangladesh to manage its money well.
The World Bank says Bangladesh's debts have gone up a lot in the last five years, and it's getting harder to pay them back.
Also, many loans in the country are not being paid back, which is causing more problems for the banks and the economy.
Experts say this is because of many issues like unrest, energy problems, high prices, and low wages.
Bangladesh's debt-servicing has become the second-largest budget expense, indicating a 'debt trap'.
The tax-to-GDP ratio has dropped to around 7% from over 10%, raising concerns about fiscal space.
External debt has surged 42% over the last five years, reaching $104.48 billion by end-2024.
Default loans in Bangladesh have risen to Tk 6.44 lakh crore, amounting to 35.7% of all banking credit.
Experts warn of structural growth problems due to excessive budget contraction and low revenue growth.
- Who
- Bangladesh government, National Board of Revenue (NBR), World Bank
- What
- Bangladesh is facing a debt crisis with rising default loans and a plunging tax-to-GDP ratio
- When
- Current fiscal challenges and data up to end-2024
- Where
- Bangladesh
- Why
- Persistent low revenue-GDP ratio, increased borrowing, and economic instability
- Debt-Servicing
- Second-largest budget expense
- Tax-to-GDP Ratio
- Plunged to 7% from over 10%
- External Debt
- $104.48 billion by end-2024
- Debt-to-Export Ratio
- 192% of export earnings
- Default Loans
- Tk 6.44 lakh crore (35.7% of banking credit)
- Total Outstanding Debt
- Tk 19,99,928 crore (as of March 2024)
- Foreign Debt
- Tk 8,41,992 crore (as of March 2024)