The future of Bangladesh’s economy depends upon the fairness of the markets, institutions and equality of opportunity. Although a market economy can promote entrepreneurialism, investment, innovation and jobs, it can also reduce equity by concentrating power in the hands of a few with poor regulation. While the growth of the ready-made garment industry, global employment, remittances, agriculture and private enterprise has led to positive economic development, will Bangladesh be able to foster an open, competitive and transparent economy? Market economies need clear laws, legal contracts and trust in financial institutions to ensure that consumers are protected and markets are competitive. If there is no regulation, then the freedom of the economy can benefit those with more wealth.
Bangladesh struggles with the idea of creating a competitive economy. There is no real competition, as gaining licenses, credit, contracts and regulation depends on personal connections. Productive entrepreneurs are being penalised unfairly. Success in business is dependent on who you know rather than who can do it best. This can lead to issues of cronyism. This should not be confused with private enterprise. Businesses are vital for development. Successful entrepreneurs shouldn’t be doubted. However, when economic power is transferred into political power, they can abuse their position by using public power to help them.
A review by the United Nations Development Programme in November 2025 shows there are concerns regarding market concentration, price manipulation and competition in Bangladesh. To help improve this, Bangladesh needs to have a strong, effective competition commission to help investigate any cartel activity, abuse of dominance and anti-competitive practices. This should be done fairly and consistently, with no political influence. No company should be above the law.
An economy should not just be looked at in terms of success in the stock market, exporting and impressive infrastructure. It should also be looked at in terms of whether individuals can afford food, housing, healthcare, education and transport. Inflation has caused issues with many individuals, particularly those with little income. As prices rise, many cannot afford the increased prices of essentials, leading to malnutrition, delayed healthcare and taking children out of education.
Inflation can be caused by many factors such as currency fluctuations, global prices, energy prices, domestic shortages and monetary factors. However, it would be naïve to assume that all price increases are due to trading manipulation. However, collusion, shortages and abuse of dominance can cause the issue to worsen. An improvement should be made to competition laws in order to help improve market knowledge, storage, transport, efficient imports and reliable supply chains. Support should be given to vulnerable households. However, setting random price controls can cause shortages as they do not consider the cost of producing and supplying goods. The aim should be to create a competitive market with reliable supply chains and help those who need it most.
Bangladesh’s banking sector demonstrates how poor governance can impact a market economy. In June 2026, non-performing loans reached 33.2% of total banking sector loans, according to the World Bank. Revenue collection was also very poor at only 8.3% of GDP. In October 2026, the Bangladesh Development Update warned that low investment, high inflation, banking sector vulnerabilities, and energy constraints are holding back growth. This shows that there is an urgent issue. Not only does this impact those who made poor loan decisions and those who didn’t monitor properly, but it can impact small and medium-sized enterprises as they struggle to gain credit. This can cause a lack of trust from depositors and investors.
Reforms need to be made to ensure that loans are categorised fairly, managed by professionals, monitored independently, and that any stolen or unpaid money can be recovered. Those borrowing should be held accountable. However, there needs to be a distinction between businesses failing due to genuine reasons and those who have mismanaged their money. Businesses that are viable but having a bad time should have legal options for restructuring. Those who are responsible should not be pushed aside by those with influence.
Bangladesh needs to look at the issues with relying on a few export industries. While the RMG industry is vital, to ensure sustainability in the long term, they need to diversify into higher-value manufacturing, agro-processing, pharmaceuticals, light engineering, electronics, information technology and modern logistics. However, this won’t happen without businesses having reliable electricity and gas, efficient ports, a skilled workforce, easy access to funding and clear regulations. Particular attention should be given to small and medium-sized enterprises. They can create many jobs but often are burdened by excessive administration and lack of funding.
The government should create an environment where new businesses can enter markets. Public contracts should be clear, business conflicts should be resolved quickly, and regulations should be applied fairly. Investment incentives should be considered carefully to ensure that they are providing tangible benefits. The economy should also be looked at in terms of employment. When there is less investment, there are fewer productive jobs. This can impact young people and make individuals more vulnerable. Technical education, industry training and support for entrepreneurship should be a priority.
A free market and highly bureaucratic government won’t solve the issue. The government should regulate fairly, provide essential infrastructure, protect consumers, ensure contracts are upheld and invest in education, healthcare and social care. They should also not be making random interventions which can discourage legitimate entrepreneurship.
Political and economic power should be kept to a reasonable level. Conflicts of interest, unclear ownership and preferential treatment can cause a lack of trust in markets and democracy. It is vital that clear rules are in place for public contracts and businesses involving public officials. The government should be strong enough to uphold laws but should also be neutral. The key points to focus on are ensuring the banking sector is disciplined, competition is enforced, investment is improved, exports diversified, the tax base widened, and social care is improved. These should be done fairly. Ultimately, the main issue is how much wealth Bangladesh can create and who will control the opportunities and benefit from creating it.
Only if a market economy is promoting entrepreneurialism, protecting competition and increasing the lives of individuals through economic growth will it have public trust. The future development of Bangladesh should focus on creating opportunities, security and dignity for the nation.
The views expressed in this article are solely those of the author
The writer is a columnist and political analyst
