Govt's bank loans reach Tk 1,08,371 crore in 11months

 
The government's loan from scheduled banks stood at Tk 1,08,371 crore in the first 11 months of the current 2024-2025 fiscal year, which is 57 percent higher than in the previous fiscal year.

This information was revealed in the Bangladesh Bank's monthly report on the government's internal debt.

According to the report, the total amount of government loans from scheduled banks stood at Tk 4,85,000 crore on May 12. This sum was Tk 68,706 crore during the same period in the previous fiscal year. The government has already repaid Tk 49,984 crore of the previous loan taken from Bangladesh Bank, despite borrowing Tk 1,08,371 crore during the current fiscal year. Consequently, the government's net debt for the year stands at Tk 56,116 crore. The total amount of debt owed by the government has dropped by nearly 32%. In other words, it has decreased from Tk 1,56,000 crore in June 2024 to Tk 1,06,000 crore.

The government's borrowing target from the banking sector has been set at Tk 1,37,000 crore in the fiscal year 2024-25 budget. However, the current interim government has lowered the figure to Tk 99,000 crore. Dr. Ahsan H. Mansur, Governor of the Bangladesh Bank, recently stated at a program that given the current state of the banking industry, this aim will be further cut to Tk 90,000 crore.

On the other hand, the government intends to minimize bank borrowing to reduce the budget deficit for the 2025-26 fiscal year. There are also plans to lower the overall budget. The national budget is set at Tk 7,90,000 crore. This is Tk 7,000 crore less than the original budget for the current fiscal year.

According to Bangladesh Bank officials, government borrowing tends to rise at the end of the fiscal year. However, the amount borrowed so far this year is much lower than the target.

Economists believe that, as part of its tight monetary policy, the government is now borrowing from commercial banks to settle Bangladesh Bank's debt. If the government had not borrowed more from commercial banks, the amount of money entering the market would have been significantly higher, increasing inflationary pressure.

>>Anuj Ahmed, AA