Bangladesh's economy is set to encounter a major shock between 2024 and 2026 as the time for debt repayments for mega projects is nearing, said Debapriya Bhattacharya, a distinguished fellow of the Center for Policy Dialogue (CPD).
"The thresholds of debt repayments on mega projects are approaching, which is a matter of concern for the economy," said the economist while emphasising the need for a plan to deal with this situation.
In an online conversation, Debapriya expressed the concern about 20 major projects of the country to reporters on Thursday.
Debapriya suggested that Bangladesh should go for a negotiation with its development partners on loan rescheduling to deal with the pressure of foreign debt repayment.
He said the current ratio of foreign debt repayment to gross domestic product (GDP) is 1.1% which may double by 2026.
Asked whether Bangladesh will be in trouble or not, he said, "It would actually depend on the country's reserve situation and the state of the economy at that time."
Debapriya Bhattacharya also said that Bangladesh has to pay mostly to Russia, China and Japan for big projects of whom China's debt repayment period is quite short.
Debapriya Bhattacharya analysed 20 major projects of the country. The list of these projects include Padma Bridge, Rooppur Nuclear Power Plant, Karnaphuli River Tunnel, Matarbari Coal Based Power Plant, Metro Rail, rail connection of Padma Bridge and more.
About Tk5.56 lakh crore are being spent on these projects, of which about 61% is from foreign debt.
