On 11 June 2026, the BNP-led government presented its first national budget in 20 years for the financial year 2026–27 in Parliament. Finance Minister Amir Khoshru Mahmud Chowdhury unveils a budget of Tk9.38 lakh crore. The government aims to build a discrimination-free and inclusive economy across all sections of society by ensuring fair participation and partnership. The government has significantly increased education funding and therefore deserves appreciation. The budget comes at a time when many developing economies are battling inflation, deficit spending, have limited resources and considerable economic strain. Bangladesh is making a long-term investment decision with their increased education spending. This sends a very positive signal about the current BNP government’s long-term priorities.
Bangladesh recognises that economic growth alone cannot make a nation successful. For economic growth to create a successful nation, a skilled, innovative, and educated population is imperative. In the proposed budget, education spending will rise to TK136,606 crore, equivalent to approximately 2 percent of GDP. This represents a remarkable increase from the previous year, when expenditure on education was TK87,206 crore, or 1.39% of the GDP. The government is also aiming to increase spending on the education sector to 5% of GDP over the next five years (a very ambitious plan). It is clear, at least for now, that the current government is setting out a plan to stabilise the economy and drive towards a higher growth trajectory. The government aims to build a skilled, driven, and technology-enabled education system.
At first glance, these numbers appear impressive. A 56 percent increase in allocation is certainly noteworthy. However, the questions considered more important are: does increased spending make a difference, and how does Bangladesh’s education spending compare to its neighbours and the world as a whole? The answer is both encouraging and challenging. Perhaps the most astonishing fact presented during the discussion is this. Following the new increase, Bangladesh is projected to spend far less on education than most of its South Asian sisters. World Bank and UNESCO-related statistics reveal that the latest public expenditure on education in India, Nepal, and Bhutan stood at approximately 4.1%, 3.7%, and nearly 5.8%, respectively. The South Asian regional average stood at nearly 2.9% of GDP. Traditionally, Bangladesh has remained at 2% or below. What that means is, the new budget of Bangladesh does not take the country to the top of the regional league table. Rather, it is the first time the new budget is moving Bangladesh to the level of most of the neighbouring countries.
Over the past 30 years, Bangladesh has seen significant positive change. There is greater literacy, more children are attending school, and the number of people below the poverty line has decreased. On top of that, the country’s garment industry has positively impacted the economy and many families. For the next phase of growth, however, something different will be needed. For Bangladesh to grow in the future, technologies such as AI, advanced manufacturing methods, biotechnology, and green tech need to be developed. To aid in the growth of these industries, a skilled workforce will be needed. Without a significant investment in education, Bangladesh risks stagnation and remaining at the lower end of the middle-income spectrum. The situation is getting more critical because Bangladesh has one of the largest youth populations in this part of the world. If the education and skills training necessary are provided, they will be a great economic asset. Else, they will be a liability and cause major frustration.
Compared to Bangladesh, India’s higher education spending, technology institute spending, and research infrastructure spending are all higher. Nepal spends a higher proportion of its GDP on education than Bangladesh, despite being a smaller economy. But the education spending in some European countries is astonishing. The goal is not to show that Bangladesh is failing, but rather to highlight the considerable opportunities for advancement. The key component is recognising that Bangladesh aspires to be a knowledge-based economy. These goals demand that educational spending be more in line with global standards. UNESCO promotes the notion that nations should aim for educational spending in the 4-6 percent of GDP range. Given that Bangladesh’s educational spending is 2 percent of GDP, the increase in spending is a positive development.
The 2026-27 budget is being implemented at a crucial time in Bangladesh’s economic history, as the country implements economic reforms to achieve macroeconomic stability and enhance long-term competitiveness. No doubt, government spending will grow considerably. This presents opportunities for policymakers to develop pathways for the desired future growth of the economy while addressing emerging adverse macroeconomic pressures. In the given circumstances, the education sector needs to be prioritised. The social and economic benefits of education improve all sectors of an economy. A more educated population increases productivity and innovation, improves employment and economic growth, and increases mobility and decreases poverty. There is a correlation between a country’s level of development and its investment in human capital. While economic activity is facilitated by physical infrastructure investments of roads, bridges and ports, education equips the population with the means to take full advantage of those infrastructures.
Furthermore, physical capital connects regions and markets, while education allows the population to transcend the inequities of an uncompetitive economy and enhances a country’s competitiveness in the global economy. While Bangladesh strives for its development goals, spending on education is not a cost to the budget, but an investment to make the country more prosperous and more resilient. It is fair to appreciate the government for making one of the highest recent increases in education spending. The increase from 1.39 percent of GDP to 2 percent is a great improvement and shows a level of political commitment. However, when comparing across regions, although Bangladesh is improving, its education spending is still very low compared to some neighbours. Because of that, the latest budget should be viewed as an increase that has a long way to go. If in the coming years Bangladesh really manages to achieve their aim of spending 5 percent of GDP on education, people in the future will appreciate the 2026 budget for the reason that it allowed the country to compete in the global market by using different resources like knowledge, skills, and innovation.
Ultimately, the significance of the 2026–27 budget will not be measured by the size of the allocation alone, but by whether it marks the beginning of a sustained national commitment to building human capital. The challenge now is to ensure that these resources translate into better schools, stronger universities, improved skills training, and greater opportunities for young people. If this commitment is maintained and effectively implemented, the 2026–27 budget may be remembered as a turning point when Bangladesh chose to invest not only in economic growth, but in the knowledge, skills, and innovation that will determine its future prosperity.
The writer is a UK based educator, author, and researcher
