Bangladesh has unveiled its largest-ever budget for FY2026–27 -- a staggering Tk 9.38 lakh crore.
We do praise the government for making such a bold statement of intent through these ambitious targets, and see them as an effort to signal confidence, resilience, and a determination to steer our economy through the turbulent times it has seen over the past few years. On paper, this all looks good.
However, accompanying the budget are extremely ambitious targets: A 6.5% GDP growth (with the World Bank, the International Monetary Fund, and the Asian Development Bank all earlier predicting growth would remain below 5%), reduced inflation to 7.5%, and Tk6.95 lakh crore in revenue collection. Ambition alone does not guarantee success, and unrealistic expectations and goals do not help the nation.
The positives of the budget are clear to see. The comprehensive vision of the budget with its strategic pillars is appreciated, focusing on inclusive development, universal social protection, investment in education and healthcare, energy security, digital transformation, and climate resilience.
Of note is the much-needed increase in allocations for education and health and signals recognition of human capital as the foundation of long-term growth. That the education sector has seen its largest ever increase of over Tk50,000cr from previous years is particularly important.
The emphasis on social protection, including expansion of allowances and pension schemes, is welcome in a country where millions remain vulnerable to economic shocks. Similarly, the focus on ease of doing business, deregulation, and digital innovation could help attract investment and diversify exports beyond garments.
The government has rightly acknowledged the need for financial sector stability. Reforms in banking and capital markets are overdue, and the budget’s emphasis on this area is encouraging. However, with non-performing loans only increasing, and the provision for whitening black money returning, we question how realistic these concerns are.
Energy security and climate resilience also feature prominently, reflecting the reality that Bangladesh cannot afford to ignore sustainability in its development trajectory. While the funds reserved for this are important, Bangladesh would do well to continue to put pressure on developed nations for additional financing.
However, our challenges remain. The revenue target of Tk 6.95 lakh crore is ambitious to the point of being unrealistic, as has already been discussed in a previous editorial. Our tax-to-GDP ratio remains one of the lowest in South Asia and without targeted and structural reforms, broadening the tax base, and tackling entrenched evasion, these targets risk becoming another exercise in paper promises. Year after year, we have missed revenue targets which have eroded credibility. Unless this culture changes, fiscal discipline will remain elusive.
Inflation is another pressing concern and even the yet again ambitious target of 7.5% means the government must contend with global volatility in addition to domestic challenges including currency depreciation. It is ordinary citizens who feel the pinch of rising food and energy costs, and nothing is more important than effective measures to stabilize prices. As such, without addressing this core issue, the budget risks being disconnected from the lived reality of households.
The deficit, projected at Tk 2.43 lakh crore (3.6% of GDP), appears manageable, yet financing it will require careful balancing of domestic borrowing, external loans, and grants. Bangladesh’s debt levels remain moderate compared to peers, but the margin for error is narrowing.
While opportunities do exist, with the emphasis on digital transformation, ICT exports, and innovation-driven growth key, we must reiterate that opportunities will only translate into outcomes if ambition is matched by realism. Bangladesh must move beyond the ritual of setting lofty targets and missing them, and we need our fiscal planning to move toward credible projections, transparent implementation, and pragmatic reforms.
The FY27 budget is ambitious, comprehensive, and forward-looking. It reflects a new government eager to project confidence and chart a path toward inclusive growth.
Yet, we must be pragmatic, focusing on achievable reforms rather than chasing headline numbers. Ambition is welcome, but it is credibility that ultimately matters. We hope that the government can match its vision with realistic strategies, and that this budget truly becomes a foundation for resilience and progress for our nation.
