In the face of mounting economic pressures, Bangladesh’s Commerce Minister has called for urgent reforms to strengthen debt management and broaden the country’s tax base, emphasising that these measures are critical to ensuring long-term economic stability and sustainable development.
Speaking at the closing session of a high-level seminar titled ‘National Multistakeholder Consultation on Bangladesh Graduation Readiness Assessment’, held at the NEC Conference Hall of the Planning Commission on Sunday (5 April), Khandker Abdul Muqtadir underscored the importance of prudent fiscal management in navigating current economic challenges.
The minister highlighted that Bangladesh is currently undergoing a complex and demanding economic phase, shaped by both domestic and global uncertainties. In this context, he stressed that carefully designed and effectively implemented policies are essential to maintaining macroeconomic stability and ensuring disciplined financial governance.
A central concern raised by the minister was the growing burden of public debt, which he attributed in part to the adoption of several large-scale development projects in previous years without adequate preparation or feasibility assessment. He noted that in some cases, questions surrounding project implementation, cost escalation, and efficiency have intensified fiscal pressure on the economy.
“Managing existing debt efficiently must be a priority, but equal caution is required when approving new projects,” he stated, adding that only realistic, well-evaluated, and outcome-oriented initiatives should be undertaken in the future. According to him, ensuring value for money and aligning projects with national development goals are essential components of sustainable economic planning.
Key Economic Concerns Highlighted
| Issue Area | Current Challenge | Recommended Action |
|---|---|---|
| Public Debt | Rising due to large, poorly prepared projects | Strengthen debt management and oversight |
| Project Implementation | Cost overruns and inefficiencies | Ensure feasibility and accountability |
| Revenue Collection | Low tax-to-GDP ratio | Expand tax base rather than increase tax rates |
| Informal Economy | Large segment remains outside tax net | Bring more individuals and businesses into taxation |
Turning to the country’s revenue system, the Commerce Minister pointed out that Bangladesh’s tax-to-GDP ratio remains below satisfactory levels compared to global and regional benchmarks. Rather than increasing tax rates, he advocated for expanding the tax net to include a broader segment of the population and business community.
He observed that a substantial portion of economic activity in Bangladesh continues to operate outside formal taxation structures, limiting the government’s ability to mobilise domestic resources. Bringing these untapped sectors into the tax framework, he argued, would significantly enhance revenue generation without placing additional burdens on existing taxpayers.
“Enhancing domestic resource mobilisation is essential not only for improving our capacity to service debt but also for sustaining development activities in the long run,” he added.
The event was chaired by Md Shahriar Kader Siddiky, Secretary of the Economic Relations Division. Among the distinguished attendees were Rabab Fatima and Planning State Minister Junaid Ahmed Palak, alongside representatives from various sectors, including government agencies, development partners, and policy experts.
Participants at the seminar broadly agreed that Bangladesh’s transition from a least developed country (LDC) to a developing nation requires stronger institutional capacity, improved fiscal discipline, and enhanced policy coordination. The discussion also emphasised the importance of aligning economic reforms with the country’s graduation readiness goals, particularly in areas such as trade competitiveness, financial resilience, and governance.
Economists attending the consultation echoed the minister’s concerns, noting that global economic volatility, fluctuating exchange rates, and external debt obligations are placing additional strain on Bangladesh’s financial system. They stressed that without comprehensive reforms in debt management and revenue mobilisation, maintaining steady growth could become increasingly challenging.
In conclusion, the minister’s remarks serve as a timely reminder of the structural reforms needed to safeguard Bangladesh’s economic future. Strengthening debt oversight, ensuring transparency in public spending, and expanding the tax base are likely to play a decisive role in steering the country towards a more resilient and sustainable development trajectory.