A closer look at the proposed budget for the next fiscal year reveals that agriculture, one of the country’s most important sectors, has not received the attention many had expected. Although the allocation has increased slightly in nominal terms, the sector’s share of the overall budget is set to decline.
The finance minister is expected to propose an allocation of Tk46,821 crore for the agriculture sector, which is Tk1,032 crore higher than the revised allocation of Tk45,789 crore for the current fiscal year.
However, the increase is negligible compared with the growth in the overall budget. While the revised budget for the current fiscal year of Tk7.88 lakh crore is set to rise by 19 per cent to Tk9.38 lakh crore, the allocation for agriculture is increasing by only 2.25 per cent.
The agriculture ministry’s share of the national budget is also shrinking. In the current fiscal year, agriculture accounted for 5.86 per cent of the national budget. In the next fiscal year, that share is expected to fall to 4.99 per cent. In other words, agriculture’s share of the budget is declining by around 0.87 percentage points.
Agriculture contributes about 11 per cent to the national economy and remains a major source of employment. Alongside the declining budget share, subsidies for the sector are also falling, raising concerns that controlling production costs and tackling food inflation may become more difficult.
In fiscal year 2023-24, the agriculture sector received an allocation of more than Tk56,000 crore, accounting for over 10 per cent of the total national budget at the time.
This year, Tk28,881 crore has been proposed for the Ministry of Agriculture alone, compared with Tk27,224 crore in the current fiscal year.
Agricultural subsidies have also fallen steadily. In fiscal year 2022-23, subsidies amounted to Tk26,744 crore. In the revised budget for 2023-24, the figure declined to Tk25,644 crore. In 2024-25, subsidies fell further to Tk17,261 crore.
Agricultural experts and farmers’ organisations have demanded at least Tk35,000 crore in subsidies in the next budget to support fertiliser, seeds, irrigation, farm machinery and agricultural credit. However, finance ministry sources said agricultural incentives will remain unchanged at Tk17,000 crore in the next fiscal year, the same as in the current year.
Ekushey Padak-winning agricultural economist Jahangir Alam told TIMES of Bangladesh, “The increase in the agriculture budget is extremely small compared with the growth in the overall budget. Inflation is currently around 9 per cent, while the agriculture budget has increased by only 1.19 per cent. Therefore, in real terms, the agriculture budget has effectively declined. The sector’s allocation has fallen in relative terms.”
He said agricultural growth had remained stagnant in recent years. While the average growth rate of the sector over the past five decades exceeded 3 per cent, growth in recent years has been significantly lower.
According to him, international uncertainties, the energy crisis and higher prices of gas, electricity, fuel and fertiliser have increased agricultural production costs. In such circumstances, reducing allocations and maintaining low subsidy levels could further weaken agricultural growth.
“This will disrupt food production, increase dependence on imports and further accelerate food inflation,” Jahangir Alam said.
Golam Hafez Kennedy, general secretary of the Bangladesh Agricultural Economists Association, said, “Before the budget announcement, we recommended that at least 10 to 12 per cent of the national budget should be allocated to agriculture. But our expectations have not been met.”
“It is not enough to increase the allocation in nominal terms. What matters is how much agriculture’s share increases after taking inflation into account and in relation to the overall budget. In this budget, the sector’s share has declined even further. That is disappointing,” he said.
The agricultural economist believed that rising production costs will inevitably push up the prices of agricultural products. As a result, achieving the government’s inflation target of 7.5 per cent may prove challenging.
“Agriculture is not just another sector; it is directly linked to food security, nutrition, employment and economic growth. Therefore, unnecessary expenditure in other sectors could have been reduced to allow greater investment in agriculture,” he added.
