Bangladesh’s new government unveils plans for a Tk 9.30 trillion national budget in June, targeting infrastructure, health, education and revenue reforms to steer Bangladesh toward a trillion-dollar economy by 2034.
The Bangladesh government is finalising what officials describe as a “big national budget” worth Tk 9.30 trillion for the fiscal year 2026-27, to be presented in Parliament in June. The spending plan aims to deliver on the new administration’s electoral pledges while tackling rising subsidy costs triggered by the Middle East conflict, modest revenue growth and the need to partially enhance government salaries.
Senior officials who attended a high-level coordination meeting on fiscal, monetary and exchange-rate policies on Friday night confirmed the headline figures and said the budget would mark a significant step-up in public investment to support long-term economic ambitions.
Revenue Drive to Reach Tk 7.95 Trillion
To fund the expanded expenditure, the National Board of Revenue (NBR) has been given an ambitious target of collecting Tk 7.95 trillion in revenue. The figure reflects the government’s determination to narrow the gap between spending and income at a time when Bangladesh’s tax-to-GDP ratio remains among the lowest globally at around 6.6 per cent. The International Monetary Fund has urged the country to lift the ratio to 9.2 per cent in the coming year.
Finance and Planning Minister Amir Khasru Mahmud Chowdhury, who chaired the coordination meeting, instructed officials to factor in “long-lasting impacts of the war fallouts on the economy, the inflationary pressure, and government’s electoral pledges alongside gradual deregulation of the economy” while drafting the budget. One senior official noted that the Middle East conflict alone is already consuming a large chunk of the subsidy bill, with even sharper effects expected in FY2026-27 due to higher import costs of fuel oils and gas.
ADP Set to Expand Sharply to Tk 3 Trillion
A major highlight of the budget will be the Annual Development Programme (ADP), which is projected to reach Tk 3.0 trillion – up from the revised Tk 2.0 trillion in the current fiscal year. Of this amount, Tk 1.9 trillion (63.33 per cent) will come from the government exchequer, while Tk 1.1 trillion is expected from external sources, mainly project loans and grants.
The jump represents a 48.44 per cent increase in domestic financing and a 52.78 per cent rise in external financing compared with the current year’s revised ADP. The government hopes the larger development outlay will accelerate infrastructure projects, improve service delivery and create jobs, helping push GDP growth to the targeted 6.5 per cent while keeping inflation below 7.5 per cent.
Implementation Monitoring and Evaluation Division (IMED) data show that ministries had spent only 30 per cent of the revised ADP allocation by February, underscoring the need for faster project execution in the coming year.
Priority Sectors: Infrastructure, Health and Education Get Major Boost
The proposed ADP allocations signal a clear shift in spending priorities. The local government division is set to receive the largest slice at Tk 366.20 billion, followed by the road transport and highways division with Tk 329.03 billion. Health services division has been earmarked for a dramatic increase to Tk 206.08 billion – more than six times its revised allocation of Tk 31.28 billion this year – elevating it to the third position from 15th.
The power division is expected to get Tk 191.86 billion, while the ministry of science and technology will receive Tk 173.66 billion. In the education sector, primary and mass education is allocated Tk 168.48 billion and the secondary and higher education division Tk 138.36 billion.
These enhanced provisions are designed to address long-standing infrastructure gaps, strengthen healthcare capacity, expand access to quality education and bolster scientific research – all areas the interim government has identified as critical for sustainable growth and fulfilling public expectations after the political transition.
Balancing Challenges and Aspirations
Officials acknowledge that preparing the budget will not be straightforward. The government must simultaneously manage the economic fallout from the Middle East turmoil, meet rising subsidy demands, honour campaign promises and implement partial salary hikes for public employees. The coordination meeting emphasised the need for prudent fiscal management to avoid further pressure on inflation and the balance of payments.
The budget also comes at a time when the country is aiming for a trillion-dollar economy by 2034. Achieving that goal will require not only higher public investment but also improved revenue mobilisation, faster implementation of development projects and continued engagement with development partners for external financing.
As the budgeting process enters its final stretch, the finance ministry is expected to hold further consultations with line ministries, the private sector and international financial institutions. The final budget document, scheduled for presentation in June, will provide a clearer roadmap on how the government intends to translate these ambitious targets into tangible outcomes for citizens.
With the current fiscal year ending in June, the new budget will set the tone for economic policymaking under the interim administration. Stakeholders will be watching closely to see whether the promised focus on key sectors and revenue reforms can deliver both short-term stability and long-term prosperity.
Image: Wikimedia
