Bangladesh's debt repayments jump 617% in 15 years, Highest in South Asia

Bangladesh’s external debt repayments have risen at a pace unmatched anywhere in South Asia over the past decade and a half, according to new World Bank figures, raising concerns about the country’s financial resilience as export earnings fail to keep up with mounting obligations.

The World Bank’s International Debt Report 2025 released Sunday, shows that South Asian nations collectively paid $95 billion in external debt servicing in 2024 — a 253 percent increase from 15 years earlier. But Bangladesh stood out sharply: its repayments jumped 617 percent between 2010 and 2024, the steepest rise in the region.
Last year, Bangladesh paid $7.3 billion in total external debt servicing, compared with just $1.02 billion in 2010. Repayments of principal surged to $4.9 billion, while interest payments climbed to $2.4 billion, reflecting a shift toward more expensive loans and heavier borrowing to fund infrastructure and budget support.
The rise in repayments comes in a year when Bangladesh’s export growth remained sluggish, increasing pressure on foreign currency reserves that have already faced strain from a widening trade deficit and declining remittances through official channels.
Pakistan saw the second-highest increase in debt servicing over the period, rising 251 percent to $13.82 billion, followed closely by India’s 246 percent jump to $82.06 billion. Sri Lanka’s debt payments rose 211 percent to $4.17 billion, despite being in a debt restructuring programme.
International financial standards flag a warning when a country’s external debt exceeds 180 percent of its annual export earnings. Bangladesh’s ratio has now climbed to 192 percent, placing it above the risk threshold for the first time.
World Bank data show Bangladesh’s total external debt reached $104 billion in 2024, quadrupling from $26 billion in 2010 as the country increasingly relied on multilateral lenders, bilateral partners, and supplier credit to fund large-scale development projects.
By the end of last year, 16 percent of all export earnings were spent on debt servicing alone — a burden that economists say could grow unless export diversification gains momentum and the taka stabilises.
Despite the sharp rise, Bangladesh’s debt indicators remain stronger than those of several neighbours facing acute financial distress. Pakistan’s external debt now stands at 315 percent of exports, Sri Lanka’s at 280 percent, and Nepal’s at 234 percent. India’s ratio is significantly lower at 82 percent, while Vietnam — one of Asia’s strongest export performers — has kept its debt exposure to just 31 percent of export earnings.
Regional averages show South Asia’s external debt amounts to about 93 percent of total exports, underscoring Bangladesh’s relatively elevated vulnerability but also the broader debt buildup across the subcontinent driven by costlier global borrowing conditions and post-pandemic fiscal stress.