Bangladesh's transition to a middle-income country status, shifting of donors' priorities to other regions, and various regulatory challenges have been responsible for this situation, stakeholders said.
They also said the ousted government intervened and barred some NGOs from receiving funds from abroad. Besides, failure to maintain good diplomatic relations with a number of development blocks contributed to the decline.
According to the NGOAB data, the amount of released fund in the last fiscal year (FY), 2023-24, declined by almost 12 per cent compared to the previous FY. The NGOs - local and international - working in Bangladesh received US$741 million in FY 23, which declined to $655 million in FY 24.
Earlier, the amount of released funds for the NGOs fluctuated, as it was $945 million in FY 2020, $779 million in FY 2021, and $821 million in FY 2022.
However, the NGOAB released $216 million in the July-September period of the running FY, 2024-25. The figure is more than the quarterly average of the last FY.
The stakeholders noted that the funding data of the major international organisations, like the World Bank or the IMF, are not included in the NGOAB statistics. Rather, these are managed by the Economic Relations Division (ERD).
Chairperson of Social Development Foundation (SDF) Muhammad Abdul Mazid said Bangladesh has been en route to become a middle income country, which has sent a message to the donors that the people here require less support than the previous time.
"Various economic data, including growing per capita income of around $2,800, reflect that the country is becoming a solvent one."
"The previous government presented Bangladesh (to the world) with inflated statistics. Besides, it often intervened and attempted to take control of most of the social development works," said Mr Mazid, a former chairman of the National Board of Revenue (NBR).
The stakeholders also said the global donors are now focusing more on the poorer countries in Africa along with the war-torn regions including Ukraine.
According to available data, the foreign donors' commitment to provide funds to the NGOs increased by almost 17 per cent in last FY over the previous FY. The amount of commitment was $720 million in FY 2023 and $840 million in FY 2024.
An official of the NGOAB said the volume of commitment usually does not reflect the actual trend.
"Either the donors may change their mind after making commitments or the government agencies here may intervene to deny the funds," he added.
Sector-wise, health received the highest fund of around Tk 22 billion in the last FY, followed by relief and rehabilitation that got nearly Tk 11 billion.
Currently, a total of 274 international NGOs and 2,362 local NGOs are operating in the country. The 'July Shaheed Smrity Foundation' was registered on September 23 as the latest addition. It is dedicated to rehabilitation of the victims of the recent student-mass movement.
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