THE proposed budget for the 2026–27 financial year is impressive by almost any numerical measures. At Tk 9.38 trillion, it is the largest budget in Bangladesh’s history. Allocations for education and health care have reached unprecedented levels. Social protection programmes have expanded. Tax relief has been offered on a range of essential commodities. Support has been promised for entrepreneurs, freelancers, exporters and vulnerable groups.
On paper, it is difficult to argue against many of these priorities. After all, investing in education, health care and social protection is not merely desirable, it is also necessary. No country can achieve sustainable development without improving the quality of its human capital. A healthy and educated population remains the foundation of long-term prosperity.
Yet, there is a question that seems to receive less attention every year when budget discussions begin: Where is the money?
The answer to the question may ultimately determine whether this budget succeeds or joins the long list of ambitious budgets that struggled during implementation. Bangladesh has become remarkably good at discussing how to spend money. We have become less effective at discussing how to generate it.
The budget assumes a revenue collection target of nearly Tk 7 trillion. History suggests that achieving such targets is far from guaranteed. For years, actual revenue collection has lagged projections. Tax administration weaknesses, a narrow tax base, widespread informality and limited compliance continue to constrain the state’s ability to mobilise resources.
At the same time, public expectations continue to grow. Citizens want better hospitals, better schools, improved infrastructure, expanded social protection and enhanced public services. These expectations are legitimate. But they require financing.
Governments do not create prosperity simply by allocating funds. They create prosperity by generating the economic conditions that produce those funds in the first place. This is where Bangladesh’s current debate often becomes unbalanced.
Social development is essential, but social development alone is not development. A country cannot redistribute wealth that it has not created.
For several decades, Bangladesh has benefited from a development model driven by exports, remittances, private entrepreneurship and demographic momentum. Today, however, many of those drivers are showing signs of strain. Private investment remains below potential. Foreign direct investment remains modest by regional standards. The banking sector continues to face structural weaknesses. Investor confidence has not fully recovered. Domestic capital formation remains weaker than what is required to achieve higher growth trajectories.
The challenge before policymakers is, therefore, not simply how to spend more. It is how to produce more.
The private sector remains the principal engine of job creation, investment, innovation and productivity growth. Governments can facilitate development, but businesses generate wealth. Entrepreneurs take risks. Investors allocate capital. Factories create jobs. Exporters earn foreign exchange. Without a vibrant private sector, even the most ambitious social programes become difficult to sustain.
This is why the budget provisions for entrepreneurs, freelancers, SMEs and exporters deserve attention. But, tax incentives alone will not be enough.
Investors are looking for predictability. They seek regulatory consistency, contract enforcement, efficient customs procedures, access to finance, energy reliability and policy stability. They want to know that the rules of the game will not change unexpectedly.
In recent years, Bangladesh has made progress in some of these areas. Yet, significant gaps remain. The larger question is whether the country is prepared to place wealth at the centre of its economic conversation once again.
There is an interesting historical parallel here. Former president Ziaur Rahman was often associated with the phrase, ‘Money is no problem.’ Over the decades, those words have been interpreted, debated, criticised and defended in different ways. Some viewed them as an expression of optimism. Others saw them as a reflection of political confidence.
Regardless of interpretation, the context of Bangladesh in the late 1970s was fundamentally different from today’s reality. The problem facing Bangladesh now is precisely money. Not because the country lacks potential. Not because opportunities do not exist. But because generating resources has become more difficult than spending them.
External financing conditions are tighter. Global competition for investment is more intense. Fiscal space is narrower. Debt management requires greater prudence. Foreign exchange earnings face new pressures. Economic growth can no longer rely solely on the formulas that worked a decade ago.
In such an environment, the most important budget question is not where the government intends to spend. It is where growth will come from.
The second phrase often associated with Ziaur Rahman was his desire to ‘make politics difficult for politicians.’ His critics frequently challenged that idea. Yet, there is another way to understand it.
Politics becomes difficult when performance matters more than promises. Politics becomes difficult when leaders are judged by outcomes rather than slogans. Politics becomes difficult when governments must deliver growth, create jobs, attract investment, maintain fiscal discipline and improve public services simultaneously. Viewed through that lens, Bangladesh today may be witnessing a continuation of that challenge.
Prime minister Tarique Rahman’s government has inherited a political environment where expectations are exceptionally high. Democratic legitimacy has returned through electoral competition. Public optimism exists. But, optimism alone cannot finance development. The government will ultimately be judged not by the size of its budget but by the results it delivers.
Can it attract significantly more investment? Can it generate employment for a growing and increasingly educated work force? Can it strengthen institutions that support economic productivity? Can it expand the tax base without discouraging entrepreneurship? Can it ensure that social spending produces measurable outcomes rather than simply larger expenditure figures?
These are not accounting questions. They are nation-building questions. The budget reflects an understandable desire to address social needs and stimulate economic recovery. But, the next phase of Bangladesh’s development journey requires a sharper focus on wealth creation, productivity, competitiveness, and investment.
Because, social progress is funded by economic success. Hospitals are built with resources generated by productive economies. Schools are financed by increasing tax revenues. Social protection programmes become sustainable when private enterprises expand.
In the end, every budget is a statement of priorities. This budget tells us what the government wants to do. The harder question remains: where will the money come from?
The answer will shape not only the success of this budget but also the trajectory of Bangladesh’s development.
Zillur Rahman is a political analyst and president at the Centre for Governance Studies. He hosts ‘Tritiyo Matra’ on Channel i.