M A Hossain,
Bangladesh has rarely looked so vulnerable. A nation once celebrated for its developmental strides—outpacing its South Asian peers in growth, garment exports worth $70 billion, and human development indicators—is now perilously close to economic self-immolation. The signs are all there: a beleaguered industrial base, a collapsing banking sector, vanishing investor confidence, and a government seemingly more interested in appearances than in action. At the heart of this crisis is a gas shortage that speaks less to scarcity and more to staggering mismanagement—a self-inflicted industrial wound whose consequences are now reverberating through every pillar of the economy.
The textile and garment industries, which generate 85 percent of Bangladesh’s export income and employ millions, are being throttled by chronic and unpredictable gas outages. Factory owners, who once anchored the country’s global competitiveness, are now literally begging for stability. Their desperation has spilled onto the pages of national newspapers, as industrial associations like the BGMEA and BTMA plead for intervention—not handouts, but simply the reliable supply of energy they’ve paid a premium for. These businesses have seen their costs balloon as they are forced to fly products out to meet international deadlines. That’s not commerce; that’s triage.
This is not a crisis born of bad luck. It is the predictable outcome of years of poor governance, willful neglect, and corruption dressed up as policy. Rather than investing in domestic gas exploration—an area with considerable untapped potential—successive governments favored imported LNG, a market fraught with opacity and opportunities for graft. Meanwhile, the gas that is available is being misallocated, diverted toward power plants and fertilizer factories at the expense of industries that keep the economy afloat.
Then there’s the issue of systemic leakage—both literal and figurative. A staggering 20 percent of the nation’s gas supply is lost to theft, inefficiency, and aging infrastructure. In a country where energy is as vital as oxygen to the body politic, allowing such hemorrhaging is tantamount to criminal negligence. It is little wonder that Bangladesh is failing to attract the manufacturing investments fleeing China amid global geopolitical shifts. Instead of leveraging the moment, the country has managed to become a cautionary tale.
This is where leadership is supposed to step in. Not with platitudes or panels but with a plan—a real one. Bangladesh needs nothing less than a Marshall Plan for energy. In the immediate term, illegal gas connections must be cut, system losses slashed, and existing contracts renegotiated to reflect the urgency of the crisis. In the medium term, the government must fast-track domestic exploration projects through transparent international bidding. And in the long term, it must pivot decisively toward renewable sources like solar and wind—not just as a climate imperative but as an economic one.
But to focus solely on energy is to ignore the broader rot. Bangladesh’s economic decline is neither sudden nor isolated. It is systemic. Private sector credit growth is in free fall, suggesting that businesses see no reason to expand and banks no incentive to lend. Nineteen banks now face a combined capital shortfall of Tk 1.71 trillion—numbers so large they lose meaning until you realize they threaten the solvency of the entire financial system. Meanwhile, the country’s $70 billion garment sector—the envy of the region—is at risk from falling global demand and the threat of U.S. tariff hikes.
Foreign direct investment is now at its lowest point in six years, according to Bangladesh Bank data. Investors, both foreign and domestic, are spooked. The absence of political stability, the perception of a caretaker government adrift, and the slow-motion collapse of the rule of law have created a toxic environment for risk-taking. The only economic metric offering a glimmer of hope is remittances, which hit a record $2.75 billion in April, as reported by the Bangladesh Bank. But remittances are not a strategy. They are a lifeline—useful, yes, but also a sign that too many of Bangladesh’s citizens see opportunity only in flight.
The interim administration, initially lauded for its technocratic competence and moral clarity, has squandered its credibility. Instead of wielding its authority to implement critical reforms, it has taken refuge in academic conferences and political distractions. There is a tragic irony in a country that has too many economists in government and too few economics-based policies. This is not the time for seminars and symposiums. It is the time for painful, necessary decisions.
To restore its footing, Bangladesh must embrace radical pragmatism. First, energy security must be treated as a non-negotiable national priority. Privatizing gas distribution may be politically sensitive, but it is economically unavoidable if we hope to stamp out inefficiency and cronyism. Second, the banking sector requires not just reform but triage. Zombie banks must be wound down, loan defaulters prosecuted, and regulatory oversight strengthened. Third, export diversification should move from policy documents to factory floors. The world needs Bangladeshi pharmaceuticals, IT services, and leather goods—if only they could be delivered at scale and quality.
Fourth, the country must improve its abysmal ease of doing business. Investors are not saints; they need certainty, protection, and profit. Offer tax holidays. Slash red tape. Digitize approvals. Finally, and perhaps most critically, political certainty must be restored. No investor, no entrepreneur, no foreign partner will engage meaningfully with a country where the next election is either a question mark or a powder keg.
These are not radical ideas. They are common sense. But common sense is often in short supply in regimes too preoccupied with optics to confront their own dysfunction.
Bangladesh has arrived at a critical juncture. It can either make the leap toward real reform, painful as that may be, or it can watch its hard-earned progress unravel. The specter of Sri Lanka’s recent economic implosion looms large—a once-promising South Asian economy undone by hubris and delay. That is a future Bangladesh must avoid at all costs.
What’s at stake here is more than GDP or credit ratings. It’s the dignity of laborers forced into joblessness. It’s the solvency of banks entrusted with people’s life savings. It’s the faith of global partners who once looked at Bangladesh as a model of post-colonial success. And it’s the hope of a generation raised on the belief that they would live better lives than their parents.
The path forward exists, but only if the government stops talking and starts acting. Because in economics, as in life, inaction is a choice too—and one with consequences.
M A Hossain, political and defense analyst based in Bangladesh. He can be reached at: writetomahossain@gmail.com
This article published at :
1. Asian Age, BD : 08 May, 25
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