Per-Capita Government Debt May Touch Tk 1.5 Lakh by Fiscal Year-End, Total Debt Projected at Tk 26.33 Lakh Crore

If the current trend of government borrowing continues, per-capita government debt in the country could reach close to Tk 1.5 lakh by the end of the current 2026-27 fiscal year. According to Finance Division estimates, total government debt could stand at Tk 26,33,100 crore at the end of June 2027. At the same time, the latest Bangladesh Bank figures show that total external debt rose to a record 114.98 billion dollars at the end of last June.

Finance Minister Amir Khosru Mahmud Chowdhury told parliament in a written answer on 6 September that per-capita government debt stood at Tk 1,29,239 as of 31 March 2026. If the Finance Division estimate holds, per-capita debt will rise by about Tk 21,000 from that figure by the end of June 2027. Per-capita debt means the average obtained by dividing total government debt by the population — it is not any individual citizen's personal debt, but it shows the average picture of the state's obligations.

The figure shifts slightly with the population assumption. Taking the population at an estimated 17.50 crore, per-capita government debt comes to about Tk 1,50,000; at 17.60 crore it is about Tk 1,49,600. In other words, whichever population figure is used, per-capita government debt is likely to stay close to Tk 1.5 lakh at the fiscal year-end. The final figure, however, will depend on the government's actual debt stock and the population at year-end.

According to figures given by the finance minister, total government debt stood at about Tk 21,44,000 crore at the end of fiscal 2024-25, equal to 38.61 percent of gross domestic product (GDP). Of that, domestic debt was about Tk 11,95,000 crore and external debt about Tk 9,49,000 crore. On that basis, the projected stock at the end of 2026-27 would be about 23 percent higher over two years.

The estimates show borrowing rising in the following years as well. According to the Finance Division, total government debt could reach Tk 29,56,700 crore at the end of 2027-28 and Tk 33,77,600 crore at the end of 2028-29. In his budget speech, the finance minister said Bangladesh's debt risk has been upgraded from the previous 'low' level to 'moderate'.

The external debt picture has also touched a record. According to Bangladesh Bank, total external debt stood at 114.98 billion dollars at the end of June 2026, up from 110.93 billion dollars at the end of March — an increase of 4.05 billion dollars, or about 3.65 percent, in three months. Most of the increase came from the public sector: public-sector external debt rose from 90.91 billion dollars in March to 95.10 billion dollars in June. Private-sector external debt, in contrast, fell by 140 million dollars to 19.88 billion dollars. Total external debt was 113.58 billion dollars at the end of June 2025 — up 1.40 billion dollars in a year.

At an exchange rate of Tk 123.20 per dollar, total external debt at the end of June comes to about Tk 14,16,000 crore, of which public-sector external debt is about Tk 11,72,000 crore. On a population of 17.50 crore, per-capita total external debt is about Tk 81,000 and public-sector external debt about Tk 67,000. It should be remembered, however, that the public-sector figure includes the borrowing of Bangladesh Bank, state-owned banks and other public institutions alongside the government — so adding it to total per-capita government debt risks double counting. According to Bangladesh Bank, total external debt was about 24 percent of GDP at the end of last March.

By maturity, 87.52 percent of total external debt at the end of June was long-term — 100.64 billion dollars — while short-term debt was 14.35 billion dollars. Among lenders, multilateral partners including the World Bank and the Asian Development Bank (ADB) account for 48.96 billion dollars, bilateral lenders for 32.54 billion dollars, commercial borrowing for 10.60 billion dollars and the International Monetary Fund (IMF) for about 5.97 billion dollars. As repayment schedules differ by type and maturity, when and how much must be repaid is also a key part of debt management.

Adding to the pressure, new disbursements have fallen sharply. According to the Economic Relations Division (ERD), Bangladesh received 294.5 million dollars in foreign assistance in the first two months of the fiscal year, July and August — of which loans were 291.4 million dollars and grants just over 3.1 million dollars. The ADB disbursed the most, about 128.7 million dollars; the World Bank gave 73.9 million dollars and Japan about 40 million dollars. Disbursement in the same period last fiscal year was about 750 million dollars — a fall of about 61 percent. New loan commitments in the same period were also limited, at only 240 million dollars.

Repayments, on the other hand, are rising. In July-August, 698.9 million dollars — about Tk 8,626 crore — was spent on principal and interest payments on earlier loans, about 2.4 times the new disbursements. Of that, principal payments were 516 million dollars and interest over 182.8 million dollars. As a result, the net flow of foreign assistance in the first two months was negative by about 400 million dollars. Repayments in the same period last fiscal year were 667.1 million dollars — up about 4.8 percent in a year. Under an earlier ERD estimate, principal and interest payments this fiscal year could reach a record 5.3 billion dollars; principal repayments on Russia's loan for the Rooppur nuclear power plant are scheduled to begin from March 2027.

Borrowing from domestic sources is also rising fast. According to Bangladesh Bank, government borrowing from commercial banks stood at Tk 6,08,025 crore as of 30 August, up from Tk 5,91,424 crore at the end of June. Government borrowing from Bangladesh Bank itself fell from Tk 94,051 crore at the end of June to Tk 90,322 crore on 30 August. Altogether, net government borrowing from the banking sector rose by about Tk 13,000 crore in the first two months — more than five times the same period last fiscal year. The budget target for bank borrowing in 2026-27 is Tk 1,12,000 crore; 11.49 percent of that target was already taken in the first two months, and with September included, bank borrowing in the first three months is reported to have reached about Tk 24,000 crore. When government bank borrowing rises, there is a risk of pressure on private-sector credit — depending on banks' liquidity, loan demand and interest rates.

The budget arithmetic explains the pressure. The current fiscal year's budget is Tk 9,38,000 crore with a revenue target of Tk 6,95,000 crore, leaving a deficit of Tk 2,43,000 crore to be financed by borrowing. About Tk 1,27,000 crore — roughly 14 percent of the total budget — has been allocated for interest payments this fiscal year, and the Finance Division projects interest costs could reach about Tk 1,62,000 crore in 2028-29. Meanwhile, Bangladesh Bank figures show non-performing loans in the banking sector rose to Tk 6,06,555 crore at the end of June 2026 — 32.78 percent of all loans disbursed; at the end of March the figure was Tk 5,88,704 crore, an increase of Tk 17,851 crore in three months. This overall debt picture is now the biggest topic of discussion in the economy — and ahead, raising revenue and managing repayment pressure will be the government's big test in budget management.