Bangladesh's external debt servicing soared 47 percent year-on-year to $589 million in the first two months of the current fiscal year amid rising global interest rates and a higher foreign loan portfolio.

The country paid $400 million for repayments of the principal amount along with interest in the same period a year ago, according to data released by the Economic Relations Division (ERD) of the finance ministry.

The ERD said disbursement of funds from foreign lenders slumped 38 percent year-on-year to $458 million in July-August period of the 2024-25 fiscal year (FY).

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Per capita foreign debt more than doubles in eight years

At the same time, overall commitment from financiers dipped drastically to only $20 million in the first two months of the fiscal year from $1.14 billion a year ago.

Bangladesh's foreign debt servicing cost had been growing steadily. But overall payment jumped since FY23.

The nation paid 25.73 percent higher to $3.35 billion in FY24 from $2.67 billion the previous year.

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Interest payments surpass Tk 100,000cr for first time