Foreign loan approvals for Bangladesh’s private sector fell sharply in fiscal year 2024–25, with only USD 454.6 million approved across 43 applications, compared to over USD 1.4158 billion for 76 applications the previous year. The Bangladesh Investment Development Authority (BIDA) reported the 75 percent decline in its annual report, attributing it to reduced investment and lower demand for imported capital machinery.

BIDA officials explained that the slowdown in domestic investment has reduced the need for foreign borrowing. Policy Exchange of Bangladesh’s chairman Dr. M Masrur Reaz noted that private sector credit growth dropped to 6.2 percent, the lowest in decades, reflecting weak domestic demand and slower economic output. He expressed hope that investment and loan demand would recover under a newly elected government.

Sources added that higher global interest rates and the depreciation of the taka against the US dollar have increased borrowing costs, further discouraging foreign loans. BIDA’s recent reform allowing short-term loans to be processed directly through banks also affected the reported figures.