The current situation shows that growth is being held back by constraints on capital machinery imports and other essential inputs, experts at a dialogue on Tuesday.
They also said that this reflected a broader dilemma: the choice between pursuing stability or unsustainable growth.
The Centre for Macroeconomic Analysis (CMEA) of the Policy Research Institute of Bangladesh (PRI), in partnership with the Department of Foreign Affairs and Trade (DFAT) of the Australian Government, hosted the July-August edition of its Monthly Macroeconomic Insights (MMI) at PRI’s conference room.
The discussion was chaired by Khurshid Alam, executive director of PRI.
He noted: “The real question is whether we should aim for sustainable growth, supported by a stable system and sound macroeconomic conditions. Achieving this, however, will inevitably require deeper and more comprehensive reforms in the future.”
Mohammed Farashuddin, chairperson of the board of trustees at East West University and former governor of Bangladesh Bank, was chief guest.
He stressed the urgency of tax reform and remarked: “Every year, 2 million new taxpayers need to be brought under the tax net so that the burden does not fall disproportionately on those who are already paying. At the same time, the government must take stronger action against money launderers.”
He stressed the importance of employment generation, underscoring the need to support small entrepreneurs through skills training and access to low-interest loans.
Ashikur Rahman, principal economist at PRI, delivered the keynote presentation.
The economic stabilization that has been painstakingly achieved through contractionary fiscal and monetary policies, and through difficult measures to restore governance in the banking sector, can only yield long-term dividends if Bangladesh invests in the capacity and autonomy of its economic institutions, most importantly Bangladesh Bank, he said.
“History offers a cautionary lesson. The deliberate erosion of Bangladesh Bank’s independence and technical capacity has enabled the rise of economic oligarchs who have operated with impunity, extracting rents in a manner reminiscent of the East India Company. Their unchecked financial irregularities pushed our banking system to the brink of collapse, undermining public trust and weakening the economy’s foundations,” Rahman added.
Expanding employment
Kamran T Rahman, president, Metropolitan Chamber of Commerce and Industry (MCCI), said: “Expanding employment and investing in skills development are critical to harnessing our demographic dividend. With coordinated action and strong collaboration between government, the private sector, and development partners, Bangladesh can overcome present challenges and secure sustainable, inclusive growth.”
Clinton Pobke, deputy head of mission, Australian High Commission in Bangladesh, noted that new governance reforms—covering banking, taxation, and judicial independence—could deliver long-term dividends if sustained, but their future depends on the next government’s choices.
He cautioned that reform windows are rare and easily lost, expressing hope that Bangladesh continues its reform journey.
