Foreign assistance disbursement and commitment both increased in Bangladesh in the first seven months of the current fiscal year thanks to speedy release of funds and additional promises as support for tackling the pandemic.

Meanwhile, the use of foreign assistance increased 28.42 per cent year-on-year to $4.7 billion, according to data from the Economic Relations Division (ERD).

The Asian Development Bank (ADB) topped the fund disbursement list with $1.7 billion.

A finance ministry official said the Manila-based development lender has already disbursed around $1 billion in assistance for Covid-19. Besides, it has almost disbursed all its budgetary support for this fiscal year.

Japan has become the second biggest financial support provider with more than $1 billion during this period.

ERD officials say a number of mega projects funded by Japan, including the Dhaka metro rail project, were being implemented in full swing following the easing of the pandemic restrictions.

A good amount of funds have been disbursed by the World Bank to support efforts aimed at tackling the pandemic along with regular loans.

The Washington-based multilateral lender provided $500 million for purchasing Covid-19 vaccines.

According to officials, there was not much use of the WB fund initially. But it has recently picked up and the government has spent $130 million under Covid-19 support.

Bangladesh has set an ambitious target to receive $12.98 billion in foreign assistance from the development partners in the current fiscal year.

But the ERD may slash the allocation target in the revised budget by $1.5 billion as the fund use has been lower than expected.

Bangladesh spent around $3 billion to $3.5 billion annually from 2013-14 to 2016-17. Spending of foreign funds crossed $7 billion per year since the fiscal year 2018-19.

The commitment of development partners also increased by 47.55 per cent year-on-year in the past seven months to $4.69 billion.

When a loan agreement is signed with a development partner, it is considered a commitment, meaning the fund is ready for utilisation.

The government has set a target to realise commitments for $6 billion in foreign aid this fiscal year.

An official of the ERD said they have some agreements in the pipeline which would be signed within June 2022. Once inked, the commitment of foreign aid will cross the figure targeted.

China made the highest commitment of $1.3 billion followed by the ADB with $822 million and the WB with $795 million.

During the past seven months, Bangladesh made debt repayments amounting to $900 million, a decrease of 26 per cent from a year ago.