Bangladesh’s broader macroeconomic trajectory faces immediate operational risk as a widening natural gas deficit threatens the country’s industrial core.
Triggered by ongoing technical outages at Maheshkhali’s offshore Floating Storage and Regasification Unit (FSRU), national gas supply has fallen to 2,130–2,150 million cubic feet per day (MMCFD) against a total daily national demand of 3,800 MMCFD—leaving an acute daily deficit of 1,650 MMCFD (44%).
This fuel shock goes beyond temporary manufacturing disruptions: it threatens export realization, job security, domestic price inflation, commercial bank debt servicing, and billions of dollars in planned industrial investments.
Supply covers just 2,130–2,150 MMCFD against a total demand of 3,800 MMCFD, leaving a daily shortfall of 1,650 MMCFD.
Industrial gas pressure in core clusters has dropped to 1–3 PSI against the required 10–15 PSI, forcing over 120 spinning mills and hundreds of manufacturing units into complete halts or partial operations.
Over Tk30,000 crore ($2.5+ billion) in completed private industrial investments—including major projects by Meghna, City, Square, and Pran-RFL Groups—remains stranded due to suspended gas connections.
Businesses face simultaneous shocks: restrictive credit access (with bank lending rates at 14%–16%) combined with inflated production overhead from alternative diesel/LPG usage.
Production cuts reduce factory cash flows, elevating the risk of non-performing loans (NPLs) across commercial banks heavily exposed to industrial sector credit.
Economic Vector | Operational Reality | Macroeconomic Risk / Fallout |
Export Manufacturing (RMG/Textiles) | 120+ spinning mills halted; dyeing/knitting capacity cut | Order cancellations, buyer air-freight penalties, and market share loss |
Private Capital Formation | 1,857 pending industrial gas connection applications | Over Tk30,000 crore in idle capital incurring high monthly interest costs |
Labor & Employment | Reduced factory shifts, idle worker rotas, forced leave | Risk of mass layoffs, reduced worker incomes, and social instability |
Banking & Financial Sector | Cash-flow contractions among gas-dependent borrowers | Escalation of Non-Performing Loans (NPLs) and tightened credit lines |
Consumer Price Inflation | Shift to high-cost diesel/LPG increases per-unit production cost | Cost-push price increases across consumer goods and construction items |
"Textile and spinning enterprises are simultaneously navigating severe gas shortages, high debt servicing costs, and operational uncertainty," stated Shawkkat Aziz Russell, president of the Bangladesh Textile Mills Association (BTMA).
"Over 121 spinning mills have already been forced to shut down or operate under severe constraints. Factories are paying wages without active production lines, depleting working capital and risking broad-based insolvencies."
"Gas pressures have reached critical minimums, halting dyeing, finishing, and ironing lines where process continuity is essential," stressed Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).
"When processing halts midway, entire fabric batches are damaged, threatening export schedules and opening doors for international buyers to cancel orders or demand price discounts."
"This crisis stems from years of over-reliance on imported LNG without developing domestic backup capacity," noted Mohiuddin Rubel, founder and CEO of Bangladesh Apparel Exchange (BAE) and former BGMEA Director.
"In the immediate term, if gas supply cannot be restored rapidly, the government must provide targeted fiscal support, tax relief, or policy incentives to help factories absorb these losses while building resilient long-term energy infrastructure."
"Operating under gas shortages inflates per-unit costs and undermines international competitiveness," stated Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD).
"Simply increasing imported LNG is not a sustainable solution as it strains foreign exchange reserves. The government must immediately implement a transparent gas allocation framework prioritizing key productive export sectors while accelerating domestic onshore exploration."
"Energy policy must not rely entirely on imported LNG," emphasized Khondaker Golam Moazzem, research director at CPD. "Immediate priority should be given to connecting gas reserves in Bhola and Barisal to the national grid, accelerating Bapex drilling programs, and incentivizing industrial transition toward renewable energy and electric systems."
Addressing the structural energy crisis requires transitioning from crisis mitigation to long-term supply diversification:
- Accelerate infrastructure pipelines to connect existing domestic gas fields in Bhola and Barisal to the main industrial grid.
- Establish a clear priority matrix for gas distribution that protects high-value export industries, textiles, and power generation over non-essential consumption.
- Expand Bapex onshore and offshore drilling programs to reduce reliance on single-point LNG import terminals.
- Offer duty-free imports and tax credits for industrial rooftop solar systems, energy-efficient machinery, and high-efficiency captive power setups.
