Finance Adviser Dr Salehuddin Ahmed has said that the government is aiming to curb the inflation rate further in the next fiscal year (FY26), although it might be a somewhat challenging task.
The finance adviser made the comment in an interview with BSS at his office at the Bangladesh Secretariat while highlighting the salient features of the upcoming national budget (FY26), which will also be the first of its kind for the interim government headed by Chief Adviser Professor Dr Muhammad Yunus.
“We’re trying our best. Our agriculture sector suffered greatly last year due to the flood. However, we’re expecting a good harvest this time,” Salehuddin said.
Regarding the government's optimism about containing inflation in the coming months, Salehuddin said they hope to bring the rate down to 8% by December 2025, and further to around 6 to 7% by June next year. “But it will take some time,” he added.
Since the Jatiya Sangsad is currently not in place, the finance adviser will present the budget via a televised speech, to be formalised through a presidential ordinance.
Officials familiar with the budget formulation process indicated that the government is likely to deliver a Tk7,90,000 crore national budget for FY26, which would be Tk7,000 crore smaller than the original budget for the current fiscal year.
This will mark the first televised budget speech of an interim government since FY2007–08, when former caretaker government adviser AB Mirza Azizul Islam delivered two consecutive budgets via national broadcast.
When asked how the government plans to tackle inflation in the upcoming budget while also addressing demands in priority sectors like education and health, Salehuddin said inflation has now reached a more stable position.
Although it once rose to around 11%, it has now come down to approximately 9%.
“Non-food inflation persists alongside food inflation, but the overall rate is gradually decreasing,” he said.
He added that while inflation had remained high for an extended period, the trend is now declining, thanks in part to measures taken during the holy month of Ramadan to enhance supply. “It’s now more or less stable.”
Salehuddin acknowledged that inflationary challenges exist on both the demand and supply sides.
The demand side is being addressed through a tighter monetary policy, while the supply side is being tackled by emphasizing production.
“Although reaching the target will be a challenging task, we’re hopeful of achieving it,” he added.
According to the Bangladesh Bureau of Statistics (BBS), the general point-to-point inflation rate in Bangladesh eased further in April 2025, reaching 9.17%, down from 9.35% in March 2025.
This slight decline was driven by downward trends in both food and non-food inflation.
In April 2025, point-to-point food inflation declined to 8.63%, from 8.93% in March, according to BBS data.
Similarly, non-food inflation also showed a slight decrease, reaching 9.61% in April, down from 9.70% in March.
Inflation declined in both rural and urban areas last month. In rural areas, it fell to 9.15% in April, down from 9.4% in March.
When asked about the current state of trade, commerce, and revenue collection, Salehuddin said that businessmen with good track records are not facing any difficulties in opening letters of credit (LCs).
However, those with poor credit histories may face obstacles, as those with non-performing loans are unlikely to receive support from banks.
“It’s not the case that business activity has come to a standstill,” he added.
Salehuddin mentioned that exporters are currently receiving various incentives.
Although the government has not received any budgetary support from the International Monetary Fund (IMF) in the past eight months, the foreign currency reserves and current account balance remain relatively stable.
He said the central bank governor has indicated that foreign currency reserves may reach $25 billion by June, and could gradually increase to $30–40 billion.
Salehuddin, a former Bangladesh Bank (BB) governor, noted that before the interim government took over, reserves had artificially reached $42–45 billion, which was not sustainable.
He explained that ideal reserve levels depend on a country’s Gross Domestic Product (GDP), relationship with broad money, debt servicing ability, and having enough reserves to cover at least three months’ worth of import bills.
“We believe we currently have enough reserves to cover over three months of import bills. We also have the capacity to meet our debt servicing obligations. Overall, the reserves are in a stable state,” he added.
Salehuddin said that if reserves gradually climb to $45–50 billion, the situation will become more comfortable. “I’m hopeful that the reserves will increase further, and more FDI is also needed to strengthen this position.”