The cost of the project to build transmission infrastructure for supplying electricity from the Rooppur Nuclear Power Plant (RNPP) has been reduced by Tk 23.30 billion under a revised proposal after some expensive components were removed from the original design, officials said.

The project, titled "Development of Transmission Infrastructure for Power Evacuation of Rooppur Nuclear Power Plant", will now cost Tk 86.52 billion, down from the original estimate of Tk 109.82 billion.

At the same time, the implementation deadline for the project has been extended until June 2026.

The Planning Commission has recommended approval of the first revised proposal at a meeting chaired by Dr Nurun Nahar Chowdhury, member (secretary) of the Industry and Energy Division of the Planning Commission.

According to officials, the revised cost represents a 21.22 per cent reduction from the original estimate, resulting in significant savings for the government.

The project is being implemented by Power Grid Bangladesh PLC.

Under the revised financing plan, Tk 60 billion will come from the Indian line of credit (LOC), Tk 14.57 billion from the government of Bangladesh and Tk 11.71 billion from PGCB's own funds.

Officials said the sharp reduction in project cost was mainly achieved by dropping several costly components from the original project design.

One of the major changes was the exclusion of a planned 20-kilometre river-crossing transmission line over the Padma and Jamuna rivers after its estimated cost became exceptionally high during the bidding process.

The component will now be implemented separately under a domestic project.

In addition, delays in land acquisition and GIS substation construction led to the removal of the 230kV Dhamrai substation expansion from the Indian LOC funding package.

Despite the reduction in overall project cost, officials said the revised budget had to absorb higher foreign exchange costs during implementation.

The original project proposal in 2018 was prepared based on an exchange rate of Tk 80.83 per US dollar, while the revised budget considered an average exchange rate of Tk 103.79 per dollar.

Officials noted that although the project cost in dollar terms declined due to the removal of several components, the depreciation of the local currency offset part of the savings.

The extension of the project deadline will allow Power Grid Bangladesh PLC to complete the remaining high-voltage transmission lines, including the 150km Rooppur-Dhaka line and the 155km Rooppur-Gopalganj line, ensuring smooth transmission of nuclear power to the national grid.

Stocks opened the week on a negative note as renewed selling pressure dragged down key indices on the Dhaka Stock Exchange (DSE) today (17 May), reversing gains from the previous three sessions amid the absence of strong market catalysts.

The benchmark DSEX index plunged 19 points to settle at 5,226, while the blue-chip DS30 index declined 11 points to close at 1,970.

Market breadth remained negative, with 228 issues declining compared to 119 advancing and 45 remaining unchanged, reflecting a broadly bearish sentiment among investors.

Turnover also took a hit, dropping by 13% to Tk868 crore, indicating reduced participation as cautious investors opted to stay on the sidelines.

According to EBL Securities PLC, the market retraced into correction territory after a brief recovery phase, as sustained selling in major stocks continued to weigh on overall sentiment.

The session began on a relatively stable note, with indices hovering near the flatline in early trading. However, as the day progressed, selling pressure intensified across large-cap stocks, pushing the market into negative territory and extending the weakness observed toward the close of the previous session, it added.

Market analysts pointed to the lack of a decisive trigger to sustain the recent upward momentum in the selective stocks, leading investors to book profits and adopt a more defensive stance.

Heavyweight stocks such as Beximco Pharmaceuticals, Eastern Bank, BAT Bangladesh, NCC Bank and City Bank emerged as major index draggers, contributing significantly to the day's decline.

On the sectoral front, pharmaceuticals dominated turnover, accounting for 14.5% of total market activity, followed by general insurance at 14.2% and engineering at 12.7%.

Despite this activity, most sectors posted negative returns. Services suffered the steepest decline, falling 2.0%, followed by IT, which dropped 1.2%, and life insurance, which lost 1.1%.

In contrast, a few sectors managed modest gains, with non-bank financial institutions rising 4.2%, jute advancing 0.8%, and travel edging up 0.5%.

Among individual stocks, NCC Bank, Bangladesh National Insurance, Dominage Steel, Asiatic Laboratories and Techno Drugs topped the turnover chart, reflecting active investor participation in these counters.

The day's top gainers included Global Heavy Chemicals, which surged 10%, followed by Investment Corporation of Bangladesh, National Feed Mill, SK Trims, and Appollo Ispat, all posting notable gains of over 9%.

On the losing side, Apex Spinning led the decline with an 8.72% drop, followed by Apex Tannery, GSPO Finance, Peoples Leasing and Fareast Finance, all registering significant losses.

Meanwhile, the Chittagong Stock Exchange (CSE) also ended in the red. The CSCX index fell 33 points to 9,031, while the broader CASPI index declined 39 points to settle at 14,675. Turnover at the port city bourse stood at Tk32 crore, mirroring the subdued trading activity seen in Dhaka.

Bangladesh Bank (BB) has introduced a monthly performance review system to strengthen the implementation of the Bangladesh Bank Service Standard, aiming to improve efficiency, accountability, and service delivery across all operational units.

The decision was taken at the inaugural performance review meeting held on Sunday with Governor of Bangladesh Bank Md Mostaqur Rahman in the chair. Deputy governors and executive directors attended it.

The service standard framework sets mandatory timelines for processing and resolving cases across all departments and branch offices, serving as a key benchmark for operational efficiency and service quality.

During the review, 90 departments and branch offices were assessed based on compliance with service standard timelines. The findings showed that 41 units (45.56 percent) achieved 100 percent compliance, while 32 units (35.56 percent) maintained around 90 percent compliance.

In addition, 11 units recorded compliance between 80 and 89 percent, and 6 units fell within the 67 to 79 percent range.

Overall, more than 81 percent of the evaluated units were found to be performing at a high compliance level, although around one-fifth of the offices demonstrated notable efficiency gaps requiring targeted intervention.

The Governor directed that performance reviews be conducted on a monthly basis under his direct supervision to ensure continuous monitoring and timely corrective measures.

He instructed all departments and branch offices to strictly adhere to service standard guidelines and ensure that all cases are processed within the prescribed timeframe, emphasizing that 100 percent compliance should be the institutional benchmark.

At the same time, he assured full institutional support to units facing difficulties, particularly in addressing procedural and operational bottlenecks affecting service delivery.

BB said the combined approach of strict accountability and supportive intervention is expected to enhance overall institutional performance and improve public service delivery standards.

Sri Lanka slapped a 50 percent surcharge on customs duties on vehicles Saturday in a bid to discourage imports and ease currency pressure stemming from the Middle East conflict.

The increase in taxes comes as the local rupee has sharply depreciated since the start of US and Israeli attacks on Iran, which prompted retaliation by Tehran.

“Given the current pressure on foreign exchange, we want people to delay their imports (of vehicles) by three months,” Junior Finance Minister Anil Jayantha Fernando told reporters in Colombo.

Vehicle were charged a customs duty of 30 percent but several other taxes make the effective import tax on a car more than 100 percent.

Sri Lanka has increased energy prices by more than a third since the start of the Middle East war and has rationed diesel and petrol in a bid to reduce the import bill.

Official figures show that Sri Lanka’s rupee has depreciated by 4.5 percent against the dollar so far this year.

Central Bank Governor Nandalal Weerasinghe told a parliamentary panel last week that the rupee would continue to slide unless global oil prices fell or Sri Lanka slashed energy imports.

Sri Lanka is emerging from its worst economic meltdown in 2022, when it ran out of foreign exchange to finance even the most essential imports such as food, fuel and medicines.

Since then, the country has been under a $2.9 billion IMF bailout programme.

The UAE is to fast-track construction of a new oil pipeline bypassing the Strait of Hormuz, official media said on Friday, after the Middle East war crippled exports through the vital waterway.

The West-East Pipeline will double state oil giant ADNOC’s capacity through Fujairah port and is expected to become operational next year, the Abu Dhabi Media Office said.

Abu Dhabi Crown Prince Sheikh Khaled bin Mohamed bin Zayed Al Nahyan “directed ADNOC to accelerate delivery of the project”, the report said.

An existing, 360-kilometre (224 miles) pipeline from the Habshan oil fields to Fujairah has a capacity of 1.8 million barrels per day, according to the Port of Fujairah website.

The UAE, which made waves by quitting oil cartel OPEC at the start of this month, has plans to raise production capacity to five million barrels a day by next year.

Oil facilities in Fujairah have been repeatedly struck during the Middle East war. Three Indian nationals were wounded in the latest attack on May 4.

India is scrambling to salvage a sinking rupee as surging oil prices linked to the Middle East conflict threaten to disrupt the world’s fastest-growing major economy.

The currency has dropped more than five percent since the crisis erupted in February, extending losses from 2025 and making it Asia’s worst-performing major currency in 2026 so far.

It hit a record low of over 96 to the dollar on Friday, prompting officials to signal that halting further depreciation is a key macroeconomic priority.

India’s central bank has already poured billions of dollars to stabilise the currency, curbed speculative trading and offered a special credit line to oil importers to ease dollar demand.

Prime Minister Narendra Modi has also urged voluntary austerity measures to rein in dollar-guzzling imports, including cutting down on gold buying and foreign travel for a year.

But the pressure persists.

“The whole system has been disturbed,” said Dilip Parmar of stockbroker HDFC Securities, citing heavy foreign investor outflows, weaker growth prospects and elevated crude prices.

“That is the basic problem which you’re seeing replicated in the fall of the rupee,” he said, noting that it was ultimately “a function of demand and supply” with dollar demand being higher.

The rupee’s slide comes as India faces a widening current account deficit driven by costly energy imports.

The gap is likely to be over two percent of GDP this fiscal year, more than double last year’s level and potentially the widest since 2012–13, according to Bank of America Securities estimates.

WIDENING DEFICIT

At the same time, foreign investors have dumped more than $20 billion in Indian stocks since the start of the Mideast conflict, the fastest pace on record, while dollar inflows have slowed, opening the possibility of a balance-of-payments gap as large as $67–88 billion.

The 2027 fiscal year “will be our third year of a balance-of-payment deficit, which is certainly unusual,” economist Dhiraj Nim of ANZ Research told AFP.

This strain has weighed on the rupee, prompting the central bank to defend it by burning through foreign exchange reserves -- now at around $697 billion, down from over $720 billion before the Middle East war.

While still covering about 11 months of imports, the decline underscores the strain.

A weaker rupee is rippling through the domestic economy.

Manufacturers and food processors, many dependent on imported raw materials priced in dollars, are seeing costs surge.

Smaller firms often lack the ability to hedge currency risks.

In Kerala’s cashew industry, which mostly imports raw nuts from Africa, the impact has been acute.

“Imports have become far more expensive for the local market,” said Rajmohan Pillai, who runs a cashew firm, adding buyers can now afford only about 90 percent of last year’s volumes.

He estimates more than 80 percent of processing units have shut in recent years, with rupee volatility a contributing factor.

‘LAST STRAW’

India’s currency decline has also hit students looking to study abroad.

Education consultants say studying in the United States now costs more than one million rupees ($10,450) extra compared with a year ago.

“This is the last straw,” said Meghna Sen, a 17-year-old aspiring psychology student.

“Now we have to track (the rupee) movement to check how much we need for our grocery budgets.”

The depreciation has punctured India’s ambition to become the world’s third-largest economy.

Modi, who once criticised his predecessors over currency weakness, has seen India’s global economic ranking dented because GDP comparisons are measured in dollars.

The country has slipped behind the United Kingdom to the sixth place according to IMF data, largely due to the rupee’s fall.

Nomura analysts warn more drastic measures may be on the anvil.

These include possible fuel price hikes, tighter controls on overseas remittances and steps to attract dollar deposits from non-resident Indians -- a playbook used in past crises.

Still, economists caution that intervention can only smooth volatility, not reverse underlying pressures.

“Fundamental factors” remain to be resolved, Nim said, adding “I would not even rule out an interest rate hike which squarely targets future inflation”.

The Reserve Bank of India knows what its options are, he said.

“All that remains is to see what it decides to choose.”

Rapid expansion of Bangladesh’s liquefied petroleum gas sector without adequate safety compliance, technical oversight and trained manpower is increasing the risk of fires and explosions in homes, industries and transportation systems, experts and regulators warned yesterday.

They said most LPG-related accidents are preventable, but negligence, weak enforcement, poor maintenance and lack of safety awareness continue to expose consumers and workers to serious hazards.

The observations came at a roundtable titled “Bangladesh’s LPG Sector Faces Rising Safety and Regulatory Challenges”, jointly organised by the Bangladesh Energy Regulatory Commission, LPG Operators Association of Bangladesh, and Energy and Power magazine at the BERC conference room.

BERC Chairman Jalal Ahmed said, “Use of LPG is increasing day by day, but safety measures are not being taken properly even though it should be the first concern.”

Presenting the keynote paper, Prof Md Easir Arafat Khan of the Department of Chemical Engineering at BUET said LPG remains a safe, clean and reliable fuel only when handled properly.

He said improper handling, negligence and non-compliance with safety regulations were the primary causes of most major LPG accidents.

Prof Arafat said many facilities still lack certified gas detectors, emergency shutdown systems, alarms and adequate fire protection measures.

“In fire hazards, fuel, oxygen and ignition sources are required. Since LPG itself is the fuel and oxygen already exists in the atmosphere, preventing gas leakage and accumulation becomes the key safety priority,” he said.

“Delay in leak detection and emergency response can allow gas accumulation, which may eventually lead to catastrophic explosions or fires,” he warned.

“Weak regulatory enforcement and oversight are also contributing to the risks,” he added.

Prof Arafat said around 90 percent of autogas stations are reportedly operating without valid licences from the Department of Explosives, indicating major gaps in safety verification and regulatory compliance.

He warned that unauthorised and unlicensed LPG road tankers are contributing to unsafe transportation practices.

Mohammad Serajul Mawla, president of the Bangladesh LPG Autogas Station and Conversion Workshop Owners’ Association, said operators are struggling with growing safety and regulatory problems while continuing operations without proper licences and compliance.

“Non-standard equipment, lack of proper training and low awareness about safe use are major concerns,” Mawla said.

He also criticised the LPG regulations introduced in 2016, saying stakeholders were not adequately consulted about practical complications during policy formulation.

He demanded more realistic and enforceable amendments to the policy.

Muhammad Mehedi Islam Khan, assistant inspector at the Department of Explosives, said limited manpower makes it difficult to oversee explosives, gas and flammable liquids across the country.

Iqbal Bahar Bulbul, assistant director of Bangladesh fire service, said many domestic accidents occur after gas accumulates overnight inside enclosed kitchens because the cooker is not properly turned off at night.

Later, all it takes is a spark to cause an explosion, he said.

He recommended keeping fire extinguishers and fire blankets in kitchens as preventive measures.

Syeda Sultana Razia, member for petroleum at BERC, questioned the effectiveness of transportation safety oversight.

“Authorities should inspect not only licences but also emergency valves, firefighting systems and vehicle safety conditions,” she said.

She also questioned whether the BRTA is handling transportation oversight strongly enough.

Razia expressed concern over irregular propane-butane composition in LPG cylinders available in the market, warning that incorrect composition can alter cylinder pressure and create additional safety risks.

AKM Fazlul Hoque, joint secretary to the Power, Energy and Mineral Resources Division, acknowledged loopholes in existing regulations and said amendments are being prepared.

LOAB President Mohammed Amirul Haque urged all stakeholders to work together to improve safety standards.

For over a decade, governments have been allocating a disproportionately low share of the budget to renewable energy despite ambitious pledges, with nearly all power and energy allocations going to fossil fuel projects, a Centre for Policy Dialogue (CPD) study has found.

The study, unveiled at an event jointly organised by CPD and Dhaka Stream at Pan Pacific Sonargaon Dhaka yesterday, comes just weeks before the BNP-led government, which has signalled a push toward clean energy, is set to unveil its first full budget. The study was co-authored by Khondaker Golam Moazzem, research director of CPD.

Presenting the findings, Khalid Mahmud, programme associate at CPD, said the allocation trend from fiscal year 2015-16 (FY16) to FY26 shows fossil fuel projects consistently capturing over 90 percent of power and energy development spending.

The budget for the ongoing FY26 showed marginal improvement, with renewable energy receiving 4.6 percent, yet fossil fuel-based projects still dominated at over 95 percent, reflecting what he called limited structural rebalancing, he said.

Mahmud added that the FY26 budget also dropped a Tk 100 crore allocation for renewable energy that had been included the previous year, and introduced no new incentives for solar or other clean technologies.

Bangladesh’s total installed renewable energy capacity stands at approximately 1,745 MW as of May 11, with solar unit accounting for over 83 percent of that. In total, renewables represent just 5.4 percent of total installed capacity, well short of a target set years ago to reach 10 percent by 2021.

The compound annual growth rate of renewables from 2016 to May 2026 is 15.78 percent. Of 42 active development projects, only three focus on renewable energy.

Despite the wind energy potential in the coastal region, wind power installation remains very low, accounting for only about 62 MW, said Mahmud, noting that renewables in Bangladesh continue to remain constrained within the national budget framework.

“The national budget must treat renewable energy not as a sub-line within the Power Division, but as a strategic national investment priority deserving its own fiscal instrument,” said Mahmud.

The government should restore and progressively scale up ADP allocations for renewables from FY27 onward, pegged to annual MW deployment targets, he added.

Also speaking at the event, Rashed Al Mahmud Titumir, finance and planning adviser to the prime minister, said the energy sector is caught in a vicious cycle that is difficult to escape.

He also pointed out that the wide gap between installed generation capacity and actual utilisation has led to significant waste through capacity charges.

“This mismatch is leading to a significant waste of public resources, most notably through capacity charges. While capacity is built to meet expected future demand, much of it remains underutilised in practice, an issue clearly reflected in Bangladesh’s experience,” he said.

“Many of the contracts in this sector were not concluded in full compliance with established rules and procedures, yet they have been given legal protection. This raises serious concerns from the perspective of transparency and fairness,” he added.

The PM’s adviser went on to point out that instead of transitioning toward a sustainable system, the country has largely continued to rely on a fossil fuel–dependent structure. “Together, these three issues form the core structural challenges of the sector.”

Without addressing these deep-rooted problems, it will not be possible to break free from the current cycle, he said, adding that resolving the crisis will require collective and coordinated action.

Rehan Asad, the PM’s adviser on telecom and ICT, said land scarcity is a major constraint on large-scale renewable deployment, citing risks to crop production from ground-mounted solar.

Hence, he said the government is prioritising rooftop solar solutions. “The government is taking a broader approach, planning renewable energy development in line with the overall energy ecosystem.”

Iftekhar Mahmud, editor-in-chief at Dhaka Stream, raised concerns about the sector’s integrity, saying large-scale renewable projects are increasingly being dominated by groups linked to the fossil fuel industry, including individuals accused of land grabbing and money laundering.

Local innovators and specialist institutions are being sidelined, while genuine entrepreneurs must navigate approvals from as many as 32 government departments, he added.

He said this difficult process discourages real investors and creates opportunities for influential groups more interested in land acquisition and bank loans than energy production.

Royal Footwear Limited, a footwear manufacturing and export-oriented company, is planning to raise Tk12 crore from the capital market through the SME platform to support its business expansion and meet rising export demand.

The company has recently re-submitted its application to the Bangladesh Securities and Exchange Commission (BSEC) to issue 1.2 crore shares under the fixed-price method through an Initial Qualified Investor Offer (IQIO).

Earlier, in 2024, Royal Footwear had applied for the same fundraising plan. However, the company later withdrew its Initial Qualified Investor Offer (QIO) proposal, citing political uncertainty, the ongoing economic slowdown, and an overall unstable business environment that was not favourable for expansion at that time.

As the business climate has improved now, the company has decided to revive its fundraising plan and move forward with the application again to support its expansion and take advantage of growing export opportunities.

As a synthetic shoe manufacturer, Royal Footwear intends to utilise the funds for business expansion, working capital, and loan repayment.

Specifically, the allocation includes, Tk2 crore for purchasing raw materials and packing materials, Tk1.67 crore for the purchase of spare parts, Tk8 crore for loan repayment, and Tk0.33 crore for IQIO expenses.

Royal Footwear Limited shares some common directors with Al-Madina Pharmaceuticals, a publicly listed company on the SME platform. In February 2023, Al-Madina Pharmaceuticals raised Tk5 crore through the SME platform to support business expansion. In FY25, the company declared a 12% cash dividend for its shareholders.

According to Royal Footwear, the company—incorporated in 2014—plans to enter the capital market to expand its operations and strengthen compliance standards. The management says that some of its international buyers have encouraged listing in the capital market, believing it would improve governance, compliance practices, and alignment with global standards.

The company mainly exports to European and Asian markets, where demand for its products continues to grow steadily. In addition, the management views capital market financing as a more sustainable long-term growth option compared to relying heavily on bank borrowing.

In FY25, Royal Footwear Limited reported revenue of Tk52.91 crore, up from Tk52.34 crore in the previous fiscal year. Its profit after tax stood at Tk2.78 crore, which was Tk3.19 crore a year ago.

Earnings per share (EPS) reached Tk0.82, which was Tk0.94 a year ago. Its net asset value (NAV) per share, after revaluation, was Tk27.54.

Prime Bank Investment Limited is acting as the issue manager for the IQIO.

According to the company prospectus, the footwear industry in Bangladesh is growing rapidly due to increasing domestic and international demand, competitive production costs and favourable government policies.

Opportunities lie in export expansion, modern technologies, and sustainable practices. However, challenges such as quality control, compliance with international standards, and workforce development persist.

Major competitors of Royal Footwear include Apex Footwear, Bata Shoe Company (Bangladesh), Bay Emporium, Lotto BD, Jenny's Shoes, Craftsman Footwear and Accessories, and MK Footwear PLC.

To remain competitive, companies are adopting advanced technologies such as CAD/CAM systems and automated machinery to enhance efficiency and quality. Many firms are also obtaining global certifications, such as the Leather Working Group (LWG) certification, to boost credibility.

Despite obstacles like limited access to finance, infrastructure gaps, and labour shortages, the industry is making strides in environmental sustainability.

Investments in eco-friendly production methods and effluent treatment plants are helping to address environmental concerns and align with international standards, further strengthening the industry's growth potential.

The government has approved a Nationwide Telecommunication Transmission Network (NTTN) licence for Bangla Phone, marking the first major telecom infrastructure licence approval since the formation of the new government. The company’s earlier bid was rejected by the interim government.

This makes Bangla Phone the seventh company in the country to receive this licence.

According to official documents, the approval was granted on May 13 after the Bangladesh Telecommunication Regulatory Commission (BTRC) sought government clearance on May 10.

Under existing guidelines, the licence allows operators to build, maintain and manage nationwide fibre-optic transmission networks and share infrastructure with telecom operators and internet service providers.

BTRC requires prior approval from the Ministry of Posts, Telecommunications and Information Technology before issuing such licences. In May last year, the regulator sought approval, but the interim government rejected the proposal.

After the new government took office, BTRC again sought approval from the ministry.

It remains unclear under which guideline the licence was approved, as there is no separate NTTN category in the telecom licensing policy.

The policy, approved by the BTRC and later endorsed by the interim government, is now under review by the current administration.

Under the licensing policy, NTTN falls under the category of National Infrastructure and Connectivity Service Provider (NICSP).

Major General (retd) Md Emdad Ul Bari, chairman of the BTRC, said the licence was issued under the legacy framework.

“When the licensing regime changes, the licence will be migrated accordingly,” he said.

Explaining why the BTRC recommended the licence for Bangla Phone, Bari said an inspection team found that the company, which has been operating in Bangladesh since 2004, already has a fibre-optic transmission network spanning more than 13,000 kilometres.

“As the country needs more transmission network infrastructure and the operator already has an extensive fibre network, the regulator recommended issuing the licence following its application and investigation,” a BTRC official said.

Bangla Phone first applied for the licence in June 2011, but the ministry rejected it in July 2014. After the company filed a writ petition, the High Court directed a review, although the ministry upheld its decision in June 2016.

The company reapplied in September 2024, prompting the BTRC to form a committee in January 2025 to assess the request.

The committee cited the need to expand affordable transmission networks nationwide, particularly in remote areas.

Considering the limitations of the country’s existing transmission network and Bangla Phone’s previously permitted infrastructure, the committee recommended issuing a new NTTN licence, according to the documents.

As per BTRC documents, the country’s other six NTTN operators currently manage a combined 148,000 kilometres of optical fibre network.

The country’s first NTTN licence was awarded to Fibre@Home in 2008, and the company now operates around 50,000 kilometres of network infrastructure.

Summit Communications operates approximately 40,000 kilometres of network, while Bahon Limited has 7,817 kilometres. Bangladesh Telecommunications Company Limited manages around 40,000 kilometres, and Power Grid Company of Bangladesh operates roughly 8,500 kilometres. Bangladesh Railway, meanwhile, has about 3,800 kilometres of optical fibre infrastructure.

In addition, the government has laid nearly 35,000 kilometres of optical fibre under projects such as Info-Sarker 3 and Connected Bangladesh, while mobile operators collectively operate around 8,200 kilometres of fibre infrastructure

Last year, Amjad H Khan, chairman of Bangla Phone, told The Daily Star that the company’s four licences, including an International Internet Gateway (IIG) licence, were cancelled during the previous government’s tenure.

He said the country still lacks adequate telecom infrastructure, creating opportunities for more players to contribute.

Dhaka division received nearly half of Bangladesh's total remittance inflows in March 2026, ahead of Chattogram and Sylhet divisions, according to a Bangladesh Bank (BB) report.

The division accounted for $1.85 billion, or 49.55 percent of the $3.75 billion that flowed in during the month — up $456.58 million, or 13.85 percent, from March 2025.

Chattogram division ranked second with $1.16 billion (31.03 percent), followed by Sylhet at $301.10 million (8.02 percent), according to BB’s Monthly Report on Workers' Remittance Inflows.

BB noted that inflows typically rise during religious festivals, at the end of the fiscal year in June, and at the close of the calendar year in December.

At the district level, Dhaka topped the list with $1.35 billion, ahead of Chattogram ($413.04 million), Cumilla ($243.40 million), and Sylhet ($161.13 million).

Bangladesh’s ambition to become a $1 trillion economy by 2034 is bold, inspiring and politically powerful. It reflects confidence in the country’s development journey and its desire to emerge as a major economic force despite evolving challenges. For a nation transformed through decades of resilience, the goal naturally captures the public imagination. Yet while the slogan is compelling, the economics behind it are more complex.

The economy is currently valued at about $470 billion. To reach $1 trillion within a decade, Bangladesh needs close to 10 percent annual GDP growth in dollar terms. That is where the difficulty lies. GDP measured in US dollars depends not only on domestic production growth, but also on inflation and exchange rate stability.

The distinction matters. If Bangladesh achieves 5 percent real growth and 7 percent inflation, the economy could expand by roughly 12 percent in nominal taka terms. But if the taka loses 3 percent of its value against the dollar each year, dollar-based GDP growth falls to about 9 percent, below what is required. In simple terms, Bangladesh may grow strongly at home yet still struggle to hit the trillion-dollar target if currency depreciation continues.

This makes the exchange rate policy central to the debate.

The Bangladesh Bank (BB) is already navigating a delicate balancing act. It must rebuild foreign exchange reserves after they fell sharply from $48 billion in 2022, while preserving export competitiveness. A weaker taka helps exporters, particularly the ready-made garments sector, remain competitive. But the same weaker currency reduces the economy’s size in dollar terms.

This creates a policy trilemma. Bangladesh cannot fully maximise three objectives at once: a strong currency, export competitiveness and reserve accumulation. A stronger taka may lift GDP in dollar calculations, but would hurt exports. A weaker taka supports exports and reserve rebuilding but delays the trillion-dollar milestone. At any given time, policymakers can effectively prioritise only two.

Global conditions further complicate matters. Rising geopolitical tensions and volatile oil prices increase import costs, strain reserves and fuel inflation. As an energy-importing economy, Bangladesh remains exposed to external shocks that can weaken the taka and disrupt growth projections.

None of this makes the trillion-dollar goal unrealistic. It does mean the path must rest on structural reform rather than political arithmetic.

The real route to a trillion-dollar economy lies in productivity growth. Bangladesh must diversify beyond garments into sectors such as pharmaceuticals, IT services, electronics, light engineering and higher-value services. Greater industrial depth, stronger foreign direct investment and technological upgrading are essential. Without this transformation, growth may continue, but not at the scale or quality required.

Human capital is equally important. Skills development, better education and higher labour productivity must become national priorities. A larger economy is not built by numbers alone; it is built by a more capable workforce.

Macroeconomic discipline will also matter. Inflation control, stable fiscal management and a predictable exchange rate policy are crucial. Gradual and manageable depreciation may prove wiser than abrupt adjustments or artificial currency support.

Ultimately, the trillion-dollar question is not simply whether Bangladesh can reach a number by 2034. It is whether the country can build an economy strong enough to make that number inevitable.

If Bangladesh sustains solid growth, preserves stability and implements meaningful reforms, it could approach $900 billion by 2034 and cross $1 trillion soon after. Reaching the milestone in 2035 instead of 2034 would not be a failure; it would be economic realism.

The true success of Bangladesh’s strategy will not be measured by a political deadline alone, but by whether it builds productive strength, resilience and institutional capacity, alongside a governance model capable of sustaining prosperity long after the trillion-dollar headline is achieved.

The writer is an economic analyst and chairman at Financial Excellence Limited

G7 finance ministers gathering in Paris on Monday will try to find common ground on tackling global economic tensions and coordinating critical raw material supplies, even as geopolitical differences threaten to test the group's cohesion.

The two-day meeting follows a summit between US President Donald Trump and Chinese President Xi Jinping in Beijing that yielded few concrete economic breakthroughs, as tensions over Taiwan and trade simmered beneath a display of diplomatic cordiality.

At the core of the Paris agenda will be what French Finance Minister Roland Lescure described as deep-seated global economic imbalances that are fuelling trade friction and risk a turbulent unwinding in financial markets.

"The way the global economy has been developing for the past 10 years or so is clearly unsustainable," he said, pointing to a pattern in which China under-consumes, the United States over-consumes and Europe under-invests.

Update from US-China summit

Lescure, who will host the talks, said the G7 offered an opportunity for frank dialogue among allies at a time of widening disagreements with Washington.

"These discussions are not easy. I'm not going to tell you that we agree on everything, including, of course, first and foremost with our American friends," he told journalists ahead of the meeting.

Finance ministers will be looking for an update on US-China relations following the Trump-Xi summit and the latest US efforts to re-open the Strait of Hormuz, as the Trump administration allowed a sanctions waiver on Russian seaborne oil to lapse on Saturday.

Merely agreeing each side bears some responsibility for the trade and capital flow imbalances would be a success, French officials involved in preparations said, though the US side is likely to be reluctant.

Fallout from Mideast conflict

"I'd be shocked if they're going to sign on to the idea this is the US's fault in some way," said Philip Luck, director of the economics programme at Washington's Center for Strategic and International Studies.

Ministers are also due to discuss the economic fallout from the Mideast conflict and volatility on global bond markets, which are of particular concern to Japan.

Britain's finance ministry said Rachel Reeves would "press for coordinated action to limit inflation and supply chain pressures, and restore freedom of navigation through the Strait of Hormuz" at the meeting, and also reassert the government's desire to reduce trade barriers between Britain and the European Union.

Divisions within the G7 complicate efforts to project unity as ministers prepare for a 15-17 June leaders summit in the spa town of Evian.

Critical mineral dependence

A second priority will be critical minerals and rare earths, where G7 governments are trying to coordinate efforts to reduce reliance on China, which dominates supply chains vital for technologies such as electric vehicles, renewable energy and defence systems.

Lescure said the G7 would push for stronger coordination to monitor markets, anticipate disruptions and develop alternative supplies, including through joint projects spanning allied economies. The aim is to ensure that "no country can ever again have a monopoly" over such materials, he said.

G7 countries are trying to agree on a common toolbox of measures to stabilise markets and encourage domestic investment, possibly through price floors for producers, pooled purchases and also tariffs.

Nonetheless, the initiative is a long-term project that would yield little at the finance ministers' meeting, said Luck, who worked on the issue in the Biden administration.

"We are in the very early innings of figuring this out," he said. "I don't think there's agreement on a strategy even within the US government, let alone being able to articulate that in a convincing way to our partners in order to get them to sign on."

Dhaka Stock Exchange and Swisscontact Bangladesh have signed a memorandum of understanding (MoU) to promote sustainable and inclusive economic development through Bangladesh’s capital market system, with a special focus on SMEs and sustainable financing instruments.

The agreement was signed on Saturday at the DSE premises by Managing Director Nuzhat Anwar and Swisscontact Bangladesh Country Director Helal Hossain in the presence of senior officials from both organisations.Geographic Reference

Under the partnership, the two organisations will jointly work to strengthen SME access to capital markets, improve corporate governance and compliance standards, and promote sustainable financing initiatives in Bangladesh.

The collaboration will focus on strategic sectors including ready-made garments (RMG), healthcare and agriculture, while also supporting initiatives related to environmental, social and governance (ESG) practices, sustainability reporting, financial inclusion, climate resilience, entrepreneurship development, trade facilitation and skill enhancement, says a press release.

Speaking at the signing ceremony, Ms Anwar said the initiative was implemented quickly through strong coordination and clear planning between the two institutions.

“This initiative has been materialised within a short period because of mutual coordination and a shared vision,” she said.Bangladesh trade analysis

She noted that small and medium enterprises require extensive support in capacity building, governance practices and regulatory compliance to enhance their participation in the capital market.

“SMEs are one of the key drivers of the economy, but many of them still lack the institutional preparedness required to access long-term financing from the capital market,” Ms Anwar said.

She added that the partnership would help create a stronger ecosystem for SMEs by offering training, advisory services and awareness programmes aimed at improving financial literacy and governance standards.

Mr Hossain of Swisscontact Bangladesh said SMEs remain a vital pillar of Bangladesh’s economy, although they continue to face challenges in financing, competitiveness and compliance.

“In the current economic context, creating opportunities for SMEs to raise alternative financing and equity-based capital is extremely important,” he said.Global economy forecast

He expressed optimism that the collaboration with DSE would help promising SMEs gain access to the capital market and reduce their dependence on traditional bank financing.

According to officials, the partnership will also facilitate joint capacity-building programmes, incubation support, workshops and advisory services to encourage wider participation in the capital market ecosystem.

The two organisations will additionally cooperate in developing sustainable financing products, including green bonds, sustainability-linked bonds, sukuk and blended-finance models to support environmentally and socially responsible investments.

Market analysts say the collaboration comes at a time when Bangladesh’s capital market is seeking to diversify financing sources and deepen participation from SMEs and sustainable enterprises.

They believe the initiative could help strengthen the country’s sustainable finance framework and support long-term economic resilience through broader access to capital market financing.

Bangladesh offers a competitive cost structure that enables Chinese firms to maintain global price dominance while relocating production, said Mohammad A Hafiz, vice president of the Bangladesh China Club Limited.

This creates a strong advantage for companies seeking efficient manufacturing alternatives while preserving profitability and export competitiveness in international markets, he added.

Hafiz made the comments during his presentation at a daylong summit in the capital today.

The event was organised by the Bangladesh China Club Limited in collaboration with representatives from the Global Chinese General Chamber of Commerce, China, and the International Business Strategy Committee of the Guangdong-Hong Kong-Macao Greater Bay Area Business Federation.

Hafiz also said that Bangladesh serves as a gateway to the broader South Asian and ASEAN markets, providing businesses with a strategic footprint outside mainland China.

Its geographic position and growing regional connectivity make the country an attractive hub for trade, investment, and supply chain diversification, he added.

In addition, Bangladesh has demonstrated proven leadership through a strong track record of managing successful multi-billion-dollar projects and international syndicated financing in the region, he said.

This experience reflects the country’s growing capability to support large-scale industrial development and long-term foreign investment partnerships, he added.

Hafiz also said that Bangladesh is addressing concerns related to energy stability by establishing new government-to-government frameworks for long-term LNG supply and expanding floating storage and regasification unit infrastructure to ensure uninterrupted industrial continuity.

The country is also improving regulatory compliance through stronger labour law standards and enhanced professional service rules designed to protect institutional investments, he added.

In addition, specialised asset management companies and strategic advisers are being utilized to ensure that investment capital is directed toward operational growth rather than passive debt accumulation, he added.

Bangladesh continues to demonstrate strong political commitment by maintaining solid bilateral ties and engaging in dedicated policy-level dialogues to create a secure and stable environment for foreign direct investment, he said.

He added that total bilateral trade between Bangladesh and China reached $24.05 billion, heavily driven by $22.88 billion in Chinese exports to Bangladesh compared to just $1.17 billion in Bangladeshi exports to China.

Saif Uddin Ahmed, chief executive officer at the Bangladesh Foreign Trade Institute, said that in the current era of global turbulence, including issues such as US reciprocal tariffs and geopolitical tensions involving the US-Israel war on Iran, Chinese investors may find opportunities to invest in and relocate their factories to Bangladesh.

Mohammad Mamdudur Rashid, managing director of the United Commercial Bank PLC, said the bank actively facilitates trade transactions and supports Chinese partners in foreign direct investment in Bangladesh, with a dedicated Chinese desk staffed by Mandarin-speaking colleagues to ensure smooth communication and efficient service.

He further outlined future areas of collaboration, including green energy and climate technology, agribusiness and food processing, logistics and supply chains, healthcare and pharmaceuticals, education and skill development, fintech and digital banking, and tourism and hospitality.

Muzaffar Ahmed, chairman of the Sustainable and Renewable Energy Development Authority, said that Bangladesh is one of the fastest-growing economies in Asia and has made significant progress in industrialization, infrastructure development, export growth, digital transformation, and energy development.

He said that the power, energy, and mineral resources sector offers significant opportunities for international investors and strategic partners, while the government remains committed to ensuring energy security, sustainable development, and a clean energy transition for future

The Bangladesh Bank (BB) has temporarily loosened the rules so commercial banks can lend more to big borrowers, treat trade guarantees more lightly, and adjust large loan limits based on how healthy their loan books are.

In a circular issued yesterday, the banking regulator said commercial lenders may lend up to 25 percent of their capital to a single client or group until June 2028. This is 10 percentage points higher than the existing ceiling of 15 percent.

Besides, non-funded exposures, such as letters of credit (LCs), will be weighted at just 25 percent until mid-2027, down from the current 50 percent.

At the same time, banks will be allowed to extend higher large-loan limits depending on their classified loan ratios.

In the circular, the central bank said the changes are meant for easing international trade finance for businesses and industries.

However, several BB officials said the facility came after a few large industrial groups exceeded their exposure limits at a number of banks.

Business leaders welcomed the decision by the BB, but economists and bankers were critical of the move. They said that looser rules could concentrate credit further in the hands of a small number of large conglomerates and politically connected economic actors.

NEW EXPOSURE LIMITS

Under the relaxed rules, banks will be allowed to extend funded loans of up to 25 percent of their total capital to a single borrower, up from the existing limit of 15 percent.

However, the combined exposure of funded and non-funded facilities must not exceed 25 percent under any circumstances, the central bank said.

Under the new rules, the conversion factor for non-funded exposure has been reduced to 25 percent from 50 percent. This means banks will now count only 25 percent of their total non-funded exposure when calculating large loan limits.

The facility will remain in place until June 30, 2027. The conversion factor will then increase in phases, rising to 30 percent by December 31, 2027; 40 percent by December 31, 2028; and 50 percent by December 31, 2029.

As per the single borrower exposure rules, a borrower may take up to 25 percent of a bank’s capital in total exposure, including both funded and non-funded facilities. Of this, 15 percent may be funded exposure and 10 percent non-funded exposure.

Previously, funded loans were capped at 15 percent of a bank’s capital. Under the new rules, banks may extend funded loans of up to 25 percent, but only if no non-funded exposure is provided. If funded exposure stands at 20 percent, a further 5 percent may be non-funded exposure.

For example, an LC worth Tk 100 was previously converted into funded exposure at Tk 50. Under the new framework, only Tk 25 will be counted.

The central bank has also revised limits on large loans based on banks’ classified loan ratios.

Under the previous rules, banks with classified loans of up to 3 percent could extend large loans amounting to 50 percent of their total loans and advances. Under the new rules, this threshold has been extended up to 10 percent.

Banks with classified loans between 10 percent and 15 percent may now maintain large loans of up to 46 percent of total loans and advances. Those with ratios between 15 percent and 20 percent will be allowed up to 42 percent, while banks in the 20 percent to 25 percent range may go up to 38 percent. For those between 25 percent and 30 percent, the ceiling will be 34 percent.

Where classified loans exceed 30 percent, large loans will be capped at 30 percent of total loans and advances.

The central bank has also raised the overall ceiling for large loans to 600 percent of a bank’s capital, up from 400 percent.

WAS IT NECESSARY NOW?

Several central bank officials, speaking on condition of anonymity, said a few large industrial groups have exceeded their exposure limits at several banks. The facility has been introduced in response to their requests.

A managing director of a commercial bank, who asked not to be named, said the current condition of the banking sector is not good.

“So, this kind of forbearance was not necessary at this time,” he said, adding that it sends the wrong signal and is contrary to international standards.

However, Mir Nasir Hossain, former president of the Federation of Bangladesh Chambers of Commerce & Industry (FBCCI), welcomed the central bank’s move.

He said the economy has expanded and many large companies often need consortium financing.

“Increasing the exposure limit will be beneficial for trade and business. It is a business-friendly decision,” said Hossain.

Ashikur Rahman, principal economist at the Policy Research Institute of Bangladesh, took a different view.

“At a time when concerns over governance, non-performing loans, and weak risk management already plague the banking sector, such relaxation may deepen systemic vulnerabilities rather than strengthen financial intermediation,” Rahman told The Daily Star.

He said that excessive concentration of lending not only undermines diversification of bank portfolios, but also amplifies the “too-connected-to-fail” problem within the financial system.”

The economist argued that a more prudent long-term approach would gradually steer large borrowers towards corporate bond issuance and capital market financing, reducing reliance on banks for major industrial projects.

“Deepening the bond and equity markets is essential if Bangladesh wishes to build a more balanced and resilient financial architecture. Unfortunately, this decision appears to move in the opposite direction, reinforcing existing distortions instead of correcting them,” he commented.

The banking sector's total capital shortfall stood at Tk2.78 lakh crore at the end of the December quarter of 2025, a slight decline from the previous quarter mainly due to Bangladesh Bank's loan rescheduling policy support, according to a central bank report.

The capital shortfall had stood at Tk2.82 lakh crore at the end of the September quarter of the same year.

A bank capital shortfall occurs when a bank's own capital and reserve funds fall below the minimum level set by the central bank. Under international standards, banks are required to maintain a specific amount of capital against their risk-weighted assets.

Bangladesh Bank data shows that 20 banks were in capital deficit at the end of the December quarter.

Bankers and economists say the crisis stems from years of aggressive lending, weak oversight, and politically influenced loan approvals. The widening capital gap is also restricting banks' lending capacity and putting pressure on international financing, signalling broader risks for the economy.

Insiders said most state-owned banks in Bangladesh have been operating for years with virtually no capital base. The government, as owner of these banks, had previously injected thousands of crores of taka from taxpayers' money to help them recover. Despite that support, the banks have failed to overcome their capital shortages.

They added that compared with other South Asian economies, Bangladesh's banking sector remains in an extremely fragile capital position.

The report also showed that the sector's capital-to-risk weighted assets ratio (CRAR), a key indicator of financial strength, fell to negative 2.64% at the end of December. International regulatory standards require banks to maintain a minimum CRAR of 12.5%.

Non-performing loans (NPLs) in the banking sector stood at Tk5.57 lakh crore, or 30.60% of total outstanding loans, at the end of December 2025.
Deficits across banks

According to the central bank report, four state-owned banks had a combined capital shortfall of Tk37,364.82 crore at the end of the December quarter.

Agrani Bank's shortfall stood at Tk6,534 crore, BASIC Bank's at Tk4,158 crore, Janata Bank's at Tk22,482 crore, and Rupali Bank's at Tk4,189 crore.

Seven Islamic banks recorded a combined capital shortfall of Tk1,74,087 crore.

EXIM Bank's deficit stood at Tk25,914 crore, First Security Islami Bank at Tk64,162 crore, Global Islami Bank at Tk15,693 crore, Islami Bank Bangladesh at Tk6,597 crore, ICB Islamic Bank at Tk2,012 crore, Social Islami Bank at Tk30,053 crore, and Union Bank at Tk29,653 crore.

Meanwhile, seven private commercial banks recorded a combined capital shortfall of Tk33,138 crore.

AB Bank's shortfall stood at Tk6,551 crore, BCBL at Tk2,065 crore, Citizens Bank at Tk81.70 crore, IFIC Bank at Tk4,704 crore, National Bank at Tk9,032 crore, Padma Bank at Tk5,837 crore, Premier Bank at Tk4,866 crore, Bangladesh Krishi Bank at Tk30,751 crore, and Rajshahi Krishi Unnayan Bank at Tk2,704 crore.

Why capital shortfall declined over 3 months

A senior Bangladesh Bank official said the main reason behind the decline in capital shortfall between the September and December quarters was the central bank's loan rescheduling policy. Rescheduling helped classify some defaulted loans as regular, reducing the amount of required provisioning against bad loans. Since provisions are maintained from banks' capital, the lower provisioning requirement reduced the capital deficit.

Former World Bank Dhaka Office Lead Economist Dr Zahid Hussain said the apparent improvement in capital shortfall over the three months was largely artificial and driven by rescheduling.

"The improvement seen in capital shortfall is the impact of rescheduling. It is creating an artificial improvement. State-owned banks, Islamic banks, and the latest generation of private commercial banks are mainly responsible for the shortfall. Banks that were already in deficit remain in deficit," he said.

He added, "It is completely unacceptable for banks to remain in a capital deficit. If a bank's CRAR falls below 10%, the central bank should take action. But that is not happening in our country."

Zahid Hussain questioned whether the sector could continue relying on rescheduling indefinitely, warning that the banking sector would remain weak without meaningful reforms. He noted that Bangladesh Bank had initially barred banks with capital shortfalls from paying staff bonuses, but later backed away from the decision.

"Instead of repeated rescheduling, writing off bad loans would be a better option," he said.

Two reasons why rescheduling is unsustainable

According to Dr Zahid Hussain, there are two major reasons why repeated loan rescheduling is unsustainable.

First, rescheduling weakens banks' balance sheets and erodes capital. He compared it to "continuous bleeding" in the human body, gradually weakening financial institutions over time.

Second, it creates a moral hazard in society. When borrowers see repeated concessions despite non-payment, they become more likely to spend borrowed money on luxury consumption, such as expensive cars or foreign travel, rather than productive investment.

"As a result, honest borrowers become discouraged, while wilful defaulters are emboldened further. Overall, the trend is undermining discipline in the banking system and weakening the sector's long-term sustainability," the economist added.

The Bangladesh Securities and Exchange Commission (Bangladesh Securities and Exchange Commission) has published a draft of sweeping new corporate governance rules that introduce stricter oversight and tighter controls on listed companies, with a focus on strengthening transparency, accountability and investor protection in the capital market.

The proposed framework marks a shift from the existing corporate governance code issued in 2018 by significantly tightening board composition requirements, expanding independence standards, and imposing stricter eligibility and shareholding rules for directors and key executives.

It also introduces enhanced restrictions on cross-directorships between listed companies and major market infrastructure institutions such as exchanges, depositories, clearing entities, brokers and merchant banks.

According to the draft, the new rules will apply to all companies with ordinary shares listed on the main board, SME board and alternative trading board (ATB) of the stock exchanges, as well as any public interest entity.

The draft, released today (14 May), has been opened for stakeholder feedback until 31 May. The regulator said it will review the comments before finalising the framework for implementation.

Board structure and shareholding requirements

Under the proposed framework, the board of directors of a listed company must consist of no fewer than five and no more than 20 members. For SME-listed companies, the ceiling will be 10 directors. Each board will be required to include at least one female director.

All sponsor-directors – excluding independent directors – must collectively hold at least 30% of a company's paid-up capital. Each director will be required to hold a minimum of 2% of shares, while nominated directors must hold at least 5%.

Independent directors and eligibility rules

The proposed rules increase the minimum requirement for independent directors. At least three directors, or one-third of the total board, whichever is higher, must be independent. This marks a shift from the existing requirement, which mandates at least one-fifth of the board to be independent directors.

The draft bars individuals who are currently directors of stock exchanges, depositories, central counterparty institutions, stock brokers, stock dealers, or merchant banks from serving as directors of listed companies. The only exception is where they are appointed as independent directors representing a holding company.

Senior management structure and compliance

Every listed company must appoint a managing director (MD) or chief executive officer (CEO), a company secretary (CS), a chief financial officer (CFO), and a head of internal audit and compliance (HIAC).

The draft specifies that individuals holding these positions will not be allowed to serve in executive roles in any other company simultaneously. However, the CFO or company secretary may hold the same position in another company within the same group – listed or unlisted – subject to prior approval from the Commission, for cost efficiency or technical expertise reasons.

In addition, the MD, CEO, CS, CFO, and HIAC cannot be removed from their positions without board approval. Any such decision must also be immediately disclosed to both the Commission and the stock exchanges.

The Commission said the proposed rules are designed to modernise corporate governance practices in Bangladesh's capital market and ensure stronger accountability across listed entities.

Bangladesh plans to position itself among the world’s top 20 countries in telecom and technology services within the next five years through a holistic digital economy strategy focused on connectivity, affordable access, startup growth, electronics manufacturing and skilled human resources.

The vision was outlined by Rehan Asad, the prime minister’s adviser on telecom and ICT, at a seminar titled “Telecom future: new government's vision” organised by the Telecom and Technology Reporters' Network Bangladesh (TRNB) at InterContinental Dhaka today.

Faqir Mahbub Anam, minister for telecom and ICT, and Md Emdad Ul Bari were also present at the programme.

“We are not only aiming to become a top-20 subscriber country, we want to become a top-20 service-quality country,” Rehan said, noting that Bangladesh already ranks among the top countries globally in terms of telecom subscribers but lags behind in service quality indicators.

According to different estimates, the telecom and ICT sector’s current contribution to Bangladesh’s GDP ranges from less than 1 percent to around 6 percent, but the figure could rise to 15 percent if the government develops a supportive ecosystem around the industry, he said.

“Yes, there will be challenges … But there is no reason why this sector cannot contribute 15 percent of GDP,” he said.

Rehan said that alongside network expansion, affordable devices and digital services are needed to ensure digital inclusion.

“We are talking about 4G and 5G, but if we do not focus on devices, then 4G and 5G mean nothing,” he said.

According to him, smartphone penetration in Bangladesh remains below 50 percent, while the cheapest smartphones still cost around Tk 10,000, making them unaffordable for many low-income users.

To address this, the government is working with local manufacturers, telecom operators, banks and mobile financial service providers to produce smartphones priced between Tk 5,000 and Tk 6,000 and introduce equal monthly instalment (EMI) facilities for consumers.

“If we can enable EMI, a farmer or rickshaw puller may be able to buy a smartphone through monthly payments,” he said.

The adviser also highlighted the need for stable and predictable policies to attract investment into the telecom and technology sectors.

“One of the biggest complaints from businesses is policy unpredictability. We want to provide a five-year roadmap for VAT, tax and customs policies so businesses can plan ahead,” he said.

He acknowledged concerns over the telecom sector’s high tax burden, saying operators face effective tax rates of up to 56 percent, significantly higher than the global average.

On spectrum policy, Rehan said the government’s priority is no longer limited to maximising revenue collection.

“Our priority is creating the ecosystem, the value chain and overall economic development,” he said.

The adviser also identified AI, cybersecurity, data centres and digital governance as key pillars of the government’s future technology strategy.

“Cybersecurity is absolutely critical,” he said, adding that both the public and private sectors would need to work together to improve the country’s cyber resilience.

He also drew comparisons with countries such as Vietnam and India, saying Bangladesh has the potential to become a major electronics manufacturing and export hub if it can ensure investment-friendly policies and support for entrepreneurs.

Rehan also said the government plans to strengthen the startup ecosystem through grants, policy support and financing facilities for young innovators and entrepreneurs.

Nineteen years ago, BNP finance minister M Saifur Rahman placed a national budget of Tk 69,740 crore for fiscal year 2006-07. Three governments have since come and gone, and BNP has now returned to power through a national election.

This time, Finance Minister Amir Khosru Mahmud Chowdhury is preparing to unveil the country’s 54th budget, which may exceed Tk 9.30 lakh crore for FY2026-27.

Despite the increase in size, the budget-to-GDP ratio has not changed much over the years. In 2006-07, the budget stood at around 12.68 percent of GDP, and is set to be 13.6 percent in FY27.

This suggests that while the economy has grown significantly in size, the government’s fiscal capacity has not strengthened at a comparable pace.

Bangladesh is therefore entering a phase where the scale of public spending is no longer the central issue. The more pressing question is whether the economy can sustain a larger budget amid rising debt, weak revenue mobilisation and institutional constraints.

Over the past two decades, the country’s socio-economic condition has changed noticeably. Electricity access has expanded, rural road connectivity has improved, mobile phone use has surged and internet-based communication has reshaped daily life. Large infrastructure projects such as the Padma Bridge and Dhaka Metro Rail have altered transport patterns and boosted economic activity.

These changes have also raised expectations.

Citizens now expect uninterrupted power supply, better transport systems, modern healthcare, quality education and improved urban services.

Dhaka dwellers want more metro rail lines, while people across the country want improved highways, second bridges across Padma and Jamuna and more industrial investment. As a result, public spending commitments have increased structurally. But, at the same time, fiscal space has tightened.

A growing share of the budget is now being absorbed by just operational expenditure. Interest payments on domestic and external borrowing have risen due to higher debt levels and elevated interest rates. Subsidies in energy, power and food are also high, while the proposed implementation of a new pay commission for public employees is expected to add further recurring pressure.

These factors leave less room for development spending, even as the overall budget size expands.

Weak revenue mobilisation remains a central challenge. Bangladesh continues to have one of the lowest tax-to-GDP ratios in South Asia, which limits the government’s ability to finance development without heavy borrowing.

The financial sector adds another layer of pressure. Non-performing loans have risen due to weak governance, political interference, lending irregularities and poor recovery. A fragile banking system reduces its capacity to support private investment and economic expansion.

Government borrowing from banks has also increased, crowding out credit available to the private sector and pushing up borrowing costs for businesses. The capital market has remained shallow and volatile, offering limited support for long-term financing needs. As a result, the economy remains heavily dependent on the banking sector.

Governance concerns and corruption further complicate fiscal management.

Delays in project implementation, cost overruns and allegations of irregularities in public procurement have reduced the efficiency of public spending.

A White Paper on the State of the Bangladesh Economy under the previous interim government estimated that around $234 billion may have been laundered during the previous Awami League period.

External shocks have also shaped recent economic pressures. The pandemic disrupted trade, employment and production. The Russia-Ukraine war pushed up global food and fuel prices, feeding inflationary pressure in import-dependent Bangladesh.

Inflation has remained above 8 percent since March 2023, eroding real incomes and weakening purchasing power. At the same time, war in the Middle East has added further volatility to global energy markets, increasing risks for inflation and foreign exchange stability.

Against this backdrop, Bangladesh faces a difficult policy balance.

Growth has slowed in recent years while inflation remains elevated. Expansionary fiscal measures could support growth, but they also risk worsening debt and price pressures.

Another important dimension is the role of the International Monetary Fund (IMF) under its ongoing programme. Reform commitments are expected to focus on raising tax revenue, improving banking, reducing subsidies, strengthening fiscal discipline and increasing exchange rate flexibility. While these measures may improve long-term stability, they carry short-term political and social costs.

For the finance minister, the job is not just to present a bigger budget. It is to rebuild trust in how public money is managed while dealing with limited resources and political promises.

He will have to make difficult choices. Money will need to go either to big infrastructure projects or to areas like health, education and skills.

In the end, the budget is not only about numbers. It will show how the government plans to manage a time of high expectations, tight finances, global uncertainty and weak institutions.