The Centre for Policy Dialogue (CPD) has reported that despite certain positive shifts during the new government’s first six months in office, Bangladesh’s economy remains predominantly weighed down by negative trends. A dramatic slump in the industrial sector has seen 95 factories permanently close across three major industrial belts between January and August, leaving 61,881 workers directly unemployed.
The findings were presented at a dialogue titled First Six Months of the New Government: An Economic Review, held on Monday morning, 24 August, at the CPD office in Dhaka. CPD Distinguished Fellow Dr Debapriya Bhattacharya delivered the keynote evaluation, alongside contributions from Distinguished Fellow Professor Mustafizur Rahman and Additional Director of Research Towfiqul Islam Khan.
According to CPD estimates, the government’s revenue deficit for the current fiscal year could reach between 130 billion and 140 billion taka. An analysis of 31 key economic indicators revealed that while 12 areas—including remittance inflows and foreign exchange reserves—showed progress, 19 crucial metrics suffered sharp downturns, notably inflation, industrial output, and per capita debt burden.
Dr Bhattacharya noted that the public held two primary expectations of the incoming administration: economic recovery and the establishment of good governance. However, anxiety persists over inflation control, investment, and employment generation. He pointed out that while the government inherited structural flaws amidst a challenging global environment, its main shortcoming lay in failing to produce a comprehensive white paper detailing the economic baseline at the time of taking office. Consequently, aligning government statements with official statistics has proved challenging.
The report drew attention to severe vulnerabilities in energy-dependent industries such as textiles, steel, paper, particle board, and ceramics across Gazipur, Savar-Ashulia, and Narayanganj-Narsingdi. Daily gas consumption in the industrial sector dropped from 1,186 million cubic feet (MMCFD) to 1,148 MMCFD, while electricity generation growth plummeted from 5.6 per cent to a negative 0.1 per cent.
Despite overall inflation easing slightly from 9.1 per cent to 8.3 per cent and food inflation moderating from 9.3 per cent to 7.2 per cent, real wage growth remains negative.
CPD nevertheless commended several policy initiatives, including raising the tax-free income threshold, scrapping provisions to legalise undisclosed income, expanding digital tax systems, merging five weak Islamic banks into the Combined Islamic Bank, and introducing transport fare concessions for senior citizens. However, concerns remain regarding political appointments to senior posts, mob violence, and governance defects in law enforcement.
