An election mandate, an economic blueprint, and a war

The BNP government has inherited a country at an unusual inflexion point, with a strong electoral mandate, a technically credible reform roadmap, and an international community broadly aligned on what needs to be done. It has also inherited an economy that grew just 3.97 percent in FY2025—well below historical averages and far short of the pace needed. Private investment has fallen to 22.48 percent of GDP, the lowest in five years, and barely a fortnight after the election, a war erupted in the Gulf that is already shaking the foundations of Bangladesh’s external account.

It would be worthwhile now to recall BNP’s ambitious 44-page election manifesto, which has already received reasonable executive attention. The manifesto promised a $1 trillion GDP by 2034, a tax-to-GDP ratio of 15 percent by 2035, one crore new jobs, universal Family Cards for four crore marginalised households, a transition from consumption-driven to investment-led growth, etc. These are serious commitments for a turbulent time, and they deserve an equally serious implementation plan.

The good thing is that the plan already exists, ready for execution. The report prepared by the Task Force on Re-strategising the Economy and Mobilising Resources for Equitable and Sustainable Development, submitted to the interim government in January 2025, provided 550 pages of technical architecture across 18 thematic areas. The manifesto and the report can be two halves of a single policy document—the first supplies the political legitimacy; the second supplies the engineering drawings.

The alignment between the two documents is striking, both identifying revenue mobilisation as foundational. Bangladesh’s tax-to-GDP ratio fell to just 6.8 percent in FY2025—among the lowest in the world and less than half the government’s 15 percent target. The task force provides the institutional machinery to close that gap: restructuring the National Board of Revenue (NBR), eliminating tax expenditures estimated to nearly equal actual tax collection, and digitising compliance. Both documents recognise private investment stagnation as the central constraint on growth, and point to regulatory reform and a functional banking sector as the prerequisites for unlocking it. Both endorse a regulatory reform commission to systematically dismantle the bureaucratic obstacles to investment.

But the task force also fills critical gaps the manifesto leaves open. The most glaring is the LDC graduation. Bangladesh, as things stand now, exits LDC status in November 2026. This transition will withdraw preferential trade access currently covering approximately 70 percent of Bangladesh’s global exports. The manifesto, however, does not mention LDC graduation, while the task force makes it the central context for its entire export strategy, recommending urgent trade diplomacy for Generalised Scheme of Preferences Plus (GSP+) equivalents, Free Trade Agreement (FTA) negotiations, and a targeted programme to build non-RMG export champions before the preference window closes.

The banking sector is the second critical gap. The manifesto promises to “restore confidence” in Bangladesh’s banks. But the scale of the problem demands specificity. Non-performing loans (NPLs) peaked at 35.73 percent of total disbursed credit in September 2025—the highest in Asia and, by several assessments, the world. The task force’s blueprint to address this challenge—asset quality reviews for all systemically important banks, an asset management company to handle NPL portfolios, and operationalisation of the Bank Resolution Ordinance 2025, which was already passed by the interim government, pending parliamentary approval—gives the new government a ready-made programme. The question is about political will, as banking sector  reform requires imposing real losses on powerful borrowers who have used political connections for years to roll over non-performing obligations.

Now layer the Iran war onto this. Bangladesh imports 95 percent of its oil and gas needs. When the Strait of Hormuz was blocked, long queues formed at filling stations within days. The Bangladesh Petroleum Corporation (BPC) introduced formal fuel rationing on March 8, capping motorcycle purchases at two litres per tank. Five of the country’s six fertiliser factories were closed. Power cuts doubled to as many as five hours per day, forcing garment factories onto diesel generators and threatening production in Bangladesh’s most vital export sector. BPC moved quickly to secure emergency diesel shipments from PetroChina, Vitol, and India’s Numaligarh Refinery pipeline. Rationing has since been partially eased ahead of Eid; the immediate crisis appears to be under control, but the structural vulnerability it exposed is not.

Approximately 75 percent of Bangladesh’s overseas workforce is employed across five Gulf states, all directly affected by Iranian strikes, airspace closures, and regional economic disruption. Bangladesh received a record $32.82 billion in remittances in 2025. A sustained Gulf economic contraction could reduce that figure by $4-$7 billion annually, withdrawing the primary income source of millions of rural households and materially worsening the country’s external account. These are not abstract projections. Over 335 flights connecting Bangladesh to the Gulf have already been cancelled, leaving workers stranded and outbound migrants unable to depart despite having spent their savings on recruitment and medical fees.

The war does not invalidate the reform agenda; it sharpens it. Bangladesh’s extreme dependence on Gulf labour markets, identified as a structural vulnerability for years but never addressed seriously, is now an emergency. The government must immediately launch bilateral engagement with Japan, South Korea, and Malaysia to diversify the labour migration pipeline. Emergency solar procurement—targeting 500-1,000 MW of new renewable capacity—should begin now, because the fiscal cost of maintaining fuel-dependent rental power plants is no longer merely wasteful; it is untenable. The task force recommended phasing these out as a medium-term priority. The war makes it an immediate one.

The new government has something most governments do not: a technically rigorous, independently produced reform roadmap covering every dimension of the economic agenda it has promised. The task force report is a gift. A government that formally adopts it as the technical companion to its manifesto sends an unambiguous signal to the IMF, the World Bank, the ADB, and investors that it knows what it is doing and intends to do it properly. True, Bangladesh’s foreign exchange reserves have recovered to $34.06 billion—the strongest position since November 2022. But the breathing room this has allowed is not unlimited.

Bangladesh has navigated Covid, the post-pandemic inflation surge, the Ukraine commodity shock, and the taka depreciation of 2022–2024. It has the institutional resilience, the development partnerships, and now the political mandate to manage the current moment. What it needs is the clarity to prioritise—LDC graduation first, banking reform in parallel, energy sector restructuring now rather than later—and the discipline to keep moving through the turbulence.

The window for the first hundred days’ agenda that actually changes the country’s trajectory is short. It must not be wasted.

Dr KAS Murshid is an economist who served as chairman of the Task Force on Re-strategising the Economy and Mobilising Resources for Equitable and Sustainable Development under the interim government. 

Views expressed in this article are the author's own. 

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