Foreign Fund Inflows to Bangladesh Corporates Dip to $9.80 Billion

Foreign fund inflows into Bangladesh’s corporate sector have fallen sharply, with private-sector short-term external borrowing declining to $9.80 billion by November 2025. Analysts and officials warn that this sustained contraction signals caution among businesses and could reflect broader economic uncertainties.

According to Bangladesh Bank (BB) data, short-term corporate external borrowing has been on a steady downward trajectory since mid-2023. In May 2023, private-sector short-term debt stood at $13.95 billion, decreasing to $10.13 billion by the end of 2025, and fluctuating slightly before settling at $9.80 billion in November 2025.

The decline is attributed to multiple factors, including persistent energy shortages in industrial hubs, the depreciation of the Bangladeshi taka against the US dollar, and economic uncertainty following the mass uprising that resulted in the fall of the Sheikh Hasina administration in August 2024. Analysts suggest that these conditions have prompted corporate entities to adopt a cautious, wait-and-see approach toward expansion and foreign borrowing.

In terms of creditor-country exposure, the United Arab Emirates tops the list with $1.71 billion in short-term private-sector loans, followed by Singapore ($1.64 billion), China ($0.93 billion), Hong Kong ($0.77 billion), and the United Kingdom ($0.52 billion).

A senior Bangladesh Bank official, speaking on condition of anonymity, noted that while declining external debt may ease some pressure on the country’s foreign exchange reserves, record remittance inflows are already supporting the stock of foreign currencies.

Bangladesh Chamber of Industries (BCI) President Anwar-ul Alam Chowdhury highlighted the challenging operating environment for private businesses. “Persistent energy shortages, law-and-order concerns, and a high-interest-rate regime have made it difficult for entrepreneurs to sustain even half of their production capacity,” he said. “Under such conditions, it is natural for both domestic and overseas borrowing to fall.”

Economists and market observers caution that while lower corporate external borrowing might temporarily shield Bangladesh from balance-of-payment pressures, sustained contraction in foreign funding could hinder private-sector-led growth, particularly at a time when domestic investment is critical for economic recovery.