Falling BD Debt/GDP Ratio

[UKBengali]

As we can see over the last 10 years the debt of BD government has fallen from 40.2 to 27.3 % of GDP.

This shows the very conservative economic policies followed by BD governments of all types from BNP/caretaker and now Awami League.

As has already been mentioned by BD Finance Minister, is it time to stop the decline of the debt/GDP ratio by increasing spending on things like education and infrastructure as an investment for the future of the country?

 

[Homo Sapiens]

As we can see over the last 10 years the debt of BD government has fallen from 40.2 to 27.3 % of GDP.

This shows the very conservative economic policies followed by BD governments of all types from BNP/caretaker and now Awami League.

As has already been mentioned by BD Finance Minister, is it time to stop the decline of the debt/ratio by increasing spending on things like education and infrastructure as an investment for the future of the country?

This graph shows the total debt both internal and foreign. Our foreign debt is 25 billion USD which is 11 percent of GDP.

Home > Economy
Bangladesh’s per capita debt up by Tk 460 to Tk 13,160
Parliament Correspondent, bdnews24.com

Published: 2015-09-03 20:03:35.0 BdST Updated: 2015-09-03 23:29:41.0 BdST


Bangladesh’s per capita debt has increased along with income.

The per capita debt has risen by Tk 460 in two years, State Minister for Finance MA Mannan, on behalf of Finance Minister AMA Muhith, told Parliament on Thursday.

The per capita debt stands at $169 or Tk 13,160, according to Mannan.

Till June 30 of the 2014-15 fiscal year, Bangladesh’s external debt (public sector) was $25.908 billion or Tk 2 trillion and 72 billion.

In June last year, the finance minister told Parliament that Bangladesh’s per capita debt was Tk 12,700.

On June 30 of the 2012-13 fiscal year, the external debt was $24.907 billion or around Tk 1 trillion and 951.46 billion.
In that financial year, Bangladesh paid $274.1 million or around Tk 21.476 billion as interest on external debts.

The amount was 8.6 percent of its export earnings and 2.9 percent of the gross domestic product (GDP).

According to the data Muhith placed in Parliament on Thursday, Bangladesh borrowed Tk 2 trillion and 72.65 billion from 11 development agencies and countries until June 30, 2015.

The World Bank has provided the most of the loans - around Tk 1.2 trillion and 3.435 billion.

The Asian Development Bank (ADB) ranks second by lending around Tk 618.056 billion.

Bangladesh also borrowed around Tk 193.762 billion from Japan and Tk 73.567 billion from China.

Loans from the Islamic Development Bank (IDB) amount to over Tk 33.582 billion. From Denmark, the country got over Tk 8.692 billion, from India around Tk 16.575 billion, Kuwait around Tk 10.755 billion, South Korea around Tk 27.918 billion, IFAD around Tk 29.354 billion and from others over Tk 36.502 billion.

In reply to a question, Mannan said Bangladesh paid Tk 14.19 billion as interest on external debt in 2014-15.

According to him, the Islami Bank topped the list of banks with the maximum profit in 2014, posting a profit of over Tk 16.21 billion.

The banks that earned marginal profits were BASIC Bank (over Tk 1.1 billion), Krishi Bank (over Tk 1.85 billion), ICB Islamic Bank (Tk 215.6 million), and the National Bank of Pakistan (Tk 996.6 million).

Mannan said mobile banking saw transactions amounting to Tk 1 trillion and 287.71 billion in 2014-15.

According to data released by the Bangladesh Bureau of Statistics (BBS) on May 14, the per capita income in Bangladesh had risen from $1,190 to $1,314.

In July, Bangladesh became a lower-middle income country with the Gross National Income per capita (GNI), joining those with annual incomes of $1,046 to $4,125.
http://bdnews24.com/economy/2015/09/03/bangladeshs-per-capita-debt-up-by-tk-460-to-tk-13160

 

[TopCat]

This graph shows the total debt both internal and foreign. Our foreign debt is 25 billion USD which is 11 percent of GDP.

Home > Economy
Bangladesh’s per capita debt up by Tk 460 to Tk 13,160
Parliament Correspondent, bdnews24.com

Published: 2015-09-03 20:03:35.0 BdST Updated: 2015-09-03 23:29:41.0 BdST


Bangladesh’s per capita debt has increased along with income.

The per capita debt has risen by Tk 460 in two years, State Minister for Finance MA Mannan, on behalf of Finance Minister AMA Muhith, told Parliament on Thursday.

The per capita debt stands at $169 or Tk 13,160, according to Mannan.

Till June 30 of the 2014-15 fiscal year, Bangladesh’s external debt (public sector) was $25.908 billion or Tk 2 trillion and 72 billion.

In June last year, the finance minister told Parliament that Bangladesh’s per capita debt was Tk 12,700.

On June 30 of the 2012-13 fiscal year, the external debt was $24.907 billion or around Tk 1 trillion and 951.46 billion.
In that financial year, Bangladesh paid $274.1 million or around Tk 21.476 billion as interest on external debts.

The amount was 8.6 percent of its export earnings and 2.9 percent of the gross domestic product (GDP).

According to the data Muhith placed in Parliament on Thursday, Bangladesh borrowed Tk 2 trillion and 72.65 billion from 11 development agencies and countries until June 30, 2015.

The World Bank has provided the most of the loans - around Tk 1.2 trillion and 3.435 billion.

The Asian Development Bank (ADB) ranks second by lending around Tk 618.056 billion.

Bangladesh also borrowed around Tk 193.762 billion from Japan and Tk 73.567 billion from China.

Loans from the Islamic Development Bank (IDB) amount to over Tk 33.582 billion. From Denmark, the country got over Tk 8.692 billion, from India around Tk 16.575 billion, Kuwait around Tk 10.755 billion, South Korea around Tk 27.918 billion, IFAD around Tk 29.354 billion and from others over Tk 36.502 billion.

In reply to a question, Mannan said Bangladesh paid Tk 14.19 billion as interest on external debt in 2014-15.

According to him, the Islami Bank topped the list of banks with the maximum profit in 2014, posting a profit of over Tk 16.21 billion.

The banks that earned marginal profits were BASIC Bank (over Tk 1.1 billion), Krishi Bank (over Tk 1.85 billion), ICB Islamic Bank (Tk 215.6 million), and the National Bank of Pakistan (Tk 996.6 million).

Mannan said mobile banking saw transactions amounting to Tk 1 trillion and 287.71 billion in 2014-15.

According to data released by the Bangladesh Bureau of Statistics (BBS) on May 14, the per capita income in Bangladesh had risen from $1,190 to $1,314.

In July, Bangladesh became a lower-middle income country with the Gross National Income per capita (GNI), joining those with annual incomes of $1,046 to $4,125.
http://bdnews24.com/economy/2015/09/03/bangladeshs-per-capita-debt-up-by-tk-460-to-tk-13160

Thats true, as per capita income increases so does per capita debt.
debt/GDP and per capita debt are two different thing.

 

[Cyberian]

How and why has Bangladesh ended up with a $25 billion debt as of June 2015?

I mean it's not like Bangladesh has been fighting wars since 1971, crushing insurgencies, building strategic weapons or has suffered from international sanctions?

 

[UKBengali]

How and why has Bangladesh ended up with a $25 billion debt as of June 2015?

I mean it's not like Bangladesh has been fighting wars since 1971, crushing insurgencies, building strategic weapons or has suffered from international sanctions?

BD borrows money at low interest loans to build multi-billion dollar infrastructure projects that it cannot pay upfront for.

25 billion dollars of foreign debt is nothing for a 230+ US billion dollar economy. Current budget is 40 billion US dollars.

 

[Cyberian]

BD borrows money at low interest loans to build multi-billion dollar infrastructure projects that it cannot pay upfront for.

25 billion dollars of foreign debt is nothing for a 230+ US billion dollar economy. Current budget is 40 billion US dollars.

I think every country tries it's best to borrow money at the lowest rate as possible. But it's surprising to see that without external threats and problems, Bangladesh has such a high amount of debt despite having such a small economy of only $206 billion Nominal GDP as of October 2015.

 

[bluesky]

I think every country tries it's best to borrow money at the lowest rate as possible. But it's surprising to see that without external threats and problems, Bangladesh has such a high amount of debt despite having such a small economy of only $206 billion Nominal GDP as of October 2015.

No, the GDP 2016 is about 230 billion US dollar, and a debt of 25 billion dollar is next to nothing. Rather, it is healthy to have some more billion dollars of additional debt. A developing country always takes loan to finance its infrastructure and pays it back with the additional income it creates with a larger economy in the following years.

 

[UKBengali]

No, the GDP 2016 is about 230 billion US dollar, and a debt of 25 billion dollar is next to nothing. Rather, it is healthy to have some more billion dollars of additional debt. A developing country always takes loan to finance its infrastructure and pays it back with the additional income it has with a larger economy in the following years.

Yep as you are actually spending less money since the debt has lower interest rate than inflation, not to mention the additional growth of economy.

@SUPARCO : Say BD borrows 10 billion dollars at 0.01 per cent interest rate with a ten year grace period and this is then payable over 25 years. The debt is still only 10 billion US dollars after 10 years but BD economy would have tripled in nominal terms after 10 years due to inflation and real GDP growth. So BD finds it far more easier to pay for this 10 billion dollars of infrastructure than if it was paying out of it's budget at the time of construction.

 

[arp2041]

Under "Forces Goal 2030" I am sure this ratio will be Zero!!

 

[Anubis]

@SUPARCO War and external threats aren't the only reason countries borrow money..infact a lot of the countries with huge debts like Japan Luxembourg Iceland etc aren't involved in any conflict.

 

[livingdead]

bd should borrow more money unless its expensive to borrow... there is big opportunity of building infra

 

[Bilal9]

bd should borrow more money unless its expensive to borrow... there is big opportunity of building infra

Yes infra has to be built in order to sustain export-led development which Bangladesh is borrowing as model from Taiwan and South Korea. Sometimes there is no alternative, if you don't have adequate infra, there will be no FDI and no export-led development and resultant increase in GDP....

Sorry to harp on like Captain Obvious but a lot of people don't understand the basics....

 

[That Guy]

When you have no opposition to debate bills, you'll find that things move far more smoothly. Unsurprising.

 

[UKBengali]

bd should borrow more money unless its expensive to borrow... there is big opportunity of building infra

BD will borrow at least 30 billion US dollars between now and 2024 from ADB, Japan, Russia and China to
build infrastructure.

 

[Bilal9]

When you have no opposition to debate bills, you'll find that things move far more smoothly. Unsurprising.

Debating bills may counter progress sometimes. South Korea got the maximum development when they were headed by the dictator....you need single focused vision.

Same thing with the KMT in Taiwan and China's central planning....

Democracy in Third world countries is a curse, most 'citizens' will vote for a Saree or a Lungi. This democracy has absolutely no meaning when it's a sham.