Official data shows that Bangladesh’s fiscal deficit climbed to 0.7 percent of GDP, or Tk 387.72 billion, in the first five months (July-November) of the current fiscal year, a sharp increase from 0.03 percent recorded in the same period last year.
The rise in interest payments has put significant pressure on public finances, raising concerns about debt sustainability. Interest payments reached Tk 712.13 billion, nearly 460 percent higher than a year earlier. Of this, Tk 636.2 billion was spent on domestic debt, while Tk 75.9 billion went toward foreign interest payments.
Government spending on general public services also surged to Tk 308.97 billion, marking a 156 percent rise. Subsidy expenditures increased by over 89 percent to Tk 279.79 billion. Total government expenditures for the period stood at Tk 1.979 trillion, up 25 percent from last year.
In contrast, revenue collection saw only a modest 1.7 percent increase, reaching Tk 1.592 trillion. Tax revenue declined nearly 3 percent to Tk 1.30 trillion, while non-tax revenue grew by 26 percent to Tk 284.51 billion. Development spending, including the annual development program, fell by 27 percent to Tk 247.37 billion.
A finance ministry report noted that net foreign borrowing remained negative, while domestic borrowing was positive, with total financing standing at 0.68 percent of GDP. The overall budget deficit for FY25 is projected at 4.53 percent of GDP, excluding grants.
