The foreign aid commitment declined by 27 per cent or US$ 568 million in the first half of the current fiscal year (FY) compared to that of the same period in the last fiscal, officials said Monday.
Economic Relations Division (ERD) officials said the development partners working in Bangladesh confirmed US$ 1.54 billion worth of loans and grants during July-December period of the FY 2013-14 compared to that of $2.11 billion in the same period last FY 2012-13.
Of the assistance confirmed, $1.26 billion was in loans and $277.24 million in grants.
The amount of the foreign assistance disbursed during the first half of the current fiscal, however, was almost the same compared to that of the same period of the last fiscal.
The bilateral and multilateral development partners, including the World Bank, the Asian Development Bank (ADB), Japan, the UN systems and the European Union disbursed $1.309 billion in aid in July-Dec period, while it was $1.308 billion in the same period last FY 2013, ERD data showed.
Among the $1.309 billion aid in July-Dec this fiscal, the government received $1.07 billion in loans and $232.21 million in grants.
"Political impasse in the last few months is the major reason behind the lesser aid confirmation by the development partners of Bangladesh," a senior ERD official told the FE.
Major donors like the World Bank, ADB, Japan, the UK's Department for International Development (DfID) and USAID did not make any substantial commitment, which affected the foreign aid flow, the official said.
Lesser aid inflow to Bangladesh through government channel would not only affect the development work, it is likely to impede the economic growth of the country, he added.
The government has set a target to mobilise a record US$ 3.30 billion worth of foreign assistance during the current fiscal in a bid to implement key development projects.
The foreign aid inflow target in the current fiscal year is US$ 520 million more than the amount of aid--- $2.78 billion--- received in the FY 2013.
Meanwhile, the government has serviced its debt worth $505.74 million during July-Dec period in the FY 2014. In the corresponding period in FY 2013, the debt servicing amounted to $510.49 million.
Another ERD official said: "Since the country has been passing through political turmoil over the last couple of months, utilisation of the external assistance has been affected. The implementation rate of foreign-financed development projects was also poor this time, resulting in lower aid disbursement."
According to Implementation Monitoring and Evaluation Division (IMED), the government ministries and agencies spent only 27 per cent of Tk 658.72 billion Annual Development Programme (ADP) in the first half of the current fiscal year, where 33 per cent funds would come from foreign assistance.
Foreign aid disbursement by ADB dipped drastically as the Manila-based lender has provided only $322.23 million worth of assistance in July-December period this fiscal year. Other donors including the World Bank, USAID, DFID and IDB have not signed any major loan deals in the last couple of months, the ERD official added.
India, which made commitment of US$ 1.0 billion assistance in August 2011, has also not disbursed funds in the last two months, he said.
The neighbour has so far disbursed only $66.38 million worth of assistance in the first quarter of the current fiscal year.
Aid commitment shrinks 27pc in 1st half of FY \\\'14
FHM Humayan Kabir | Published: January 28, 2014 00:00:00 | Updated: November 30, 2026 06:01:00
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