The proposed national budget cannot be considered people-friendly unless greater priority is given to agriculture, speakers at a discussion in Dhaka said on Saturday, arguing that excessive spending on power-sector capacity charges and fuel subsidies is limiting investment in sectors that directly benefit citizens.
The remarks came during a discussion titled “People‑Friendly Budget: Ideas and Expectations” held on Saturday morning at the Dhaka Reporters Unity.
Associate Professor Mosahida Sultana of the University of Dhaka’s Accounting Department spoke on the country’s current economic situation and the crises in the electricity and fuel sectors. She said rising electricity and fuel prices are placing pressure on agriculture and ordinary citizens, increasing production costs.
She noted that the current budget has proposed nearly Tk27,000 crore for Petrobangla subsidies and around Tk55,000 crore for payment of capacity charges in the electricity sector. She warned that due to the ongoing global tensions, these expenditures could exceed Tk1 lakh crore.
Mosahida Sultana said the country currently has an excess electricity production capacity of about 7,700 megawatts, which requires substantial annual capacity charge payments. Meanwhile, despite annual expenditure of around Tk12,000 crore on LNG imports, domestic gas exploration and production are not receiving adequate attention.
She added: “If the cause of inflation lies in electricity and fuel, the budget must address this. Otherwise, production costs in agriculture will rise, increasing the overall cost of living for the entire population.”
Regarding fuel subsidies, she said: “This is therefore not a people‑friendly budget; it is producer‑friendly.” She stressed the need for effective government measures to reduce capacity charges; without them, ensuring necessary allocations to other sectors will be difficult. On attracting investment, she said, the energy crisis results in irregular gas supply to factories and high electricity costs, discouraging expected investments.
Shamim Alam Shibli, agriculture and social protection specialist at CPD, said: “Agriculture is the main lifeline of our economy, contributing 47 per cent. However, unlike other countries, our agriculture lacks diversity. We remain heavily dependent on rice cultivation, which necessitates foodgrain imports.”
He added that a large portion of agricultural subsidies in the budget is spent on purchasing fertiliser and seeds. The country uses about 6.6 million tonnes of fertiliser annually, 70 per cent of which goes to Boro rice cultivation. With the closure of the Hormuz Strait, global fertiliser prices have risen. Although the government supplies farmers with fertiliser at Tk27 per kilogram, rising international prices mean the government effectively spends about Tk103–105 per kilogram.
Shamim Alam Shibli said: “Rising fertiliser prices increase production costs, ultimately affecting consumers. What can the government do? How can it budget without raising prices? It can arrange fertiliser imports from Russia.”
On flood damage in the haor region, he said, even though only 1 per cent of national production is affected, rice prices in the market have risen. Government action is needed to control this. While affected farmers receive Tk7,500 per three months as compensation, it is insufficient compared to their actual losses. He proposed providing free fertiliser and seeds in the next season. Shibli praised the farmer card initiative but cautioned that political influence must not affect its distribution.
Barakatullah Maruf, trade researcher at LDC Graduation Watch, criticised false statistics prepared by the previous government to meet UN criteria for graduation from the least developed country category. He warned that relying on such statistics could increase national debt and raise medicine prices for citizens. He questioned whether the budget adequately prepares for such challenges.
He also highlighted that farmers continue to cultivate crops despite limited support. “Although the government claims to provide agricultural subsidies, the real subsidy is borne by the farmers themselves, who are not compensated for their labour.”
He further noted that agreements with the United States obligate Bangladesh to purchase 14 Boeing planes and import LNG, which require budgetary allocations. He questioned the necessity of such expenditures.
Abul Hasan Rubel, executive coordinator of the Ganosamhati Andolon (GSA), said: “If we want a people‑friendly economy and not a debt‑ridden one, a progressive tax policy is essential. Taxes must be collected from the wealthy, not imposed on the poor.”
He said Bangladesh’s tax‑to‑GDP ratio is around 7.5 per cent, among the lowest globally. To serve the people, the government must increase tax collection; otherwise, dependency on foreign sources will continue. Enhancing government capacity is essential to reduce such reliance.
He added that a significant portion of the economy is informal, creating a large gap between VAT collection and actual government revenue. Digitalisation and full automation are needed to boost tax revenue.
