Every budget season follows a familiar script. Politicians argue about deficits. Economists debate revenue targets. Business leaders complain about taxes. Television talk shows obsess over growth projections. This year has been no different.
The proposed budget for the 2026–27 financial year has already been described as unrealistic, overly ambitious and impossible to implement. Some opposition politicians have compared it to a packet of chanachur. Others have labelled it as ‘against people’ and ‘looter-friendly’ budget. Such reactions may generate headlines. They do not necessarily generate insight.
The opposition’s eagerness to dismiss the budget has reached the point where one lawmaker sought to discredit it by comparing its size to the 2006 budget of the late prime minister Khaleda Zia’s government, an exercise that overlooks two decades of inflation, economic expansion and the vastly different scale of today’s economy. The size of a budget tells us little about its quality. The real question is not how large it is, but what it seeks to achieve.
International experience offers a useful perspective. South Korea’s transformation from a war-ravaged agrarian economy in the 1960s into a high-income industrial nation was driven by decades of state-led investment in education, infrastructure, technology and export industries. Malaysia followed a similar path from the 1970s onward. Vietnam’s remarkable rise since the Doi Moi reforms of 1986 relied on sustained investment in infrastructure, manufacturing, skills development and state capacity.
Nor is Bangladesh unusual in operating with a budget deficit. Advanced economies such as the United States, Japan, France and the United Kingdom have all run fiscal deficits in recent years, often ranging between 4 and 8 per cent of gross domestic product. Vietnam, frequently cited as a model for Bangladesh, has also budgeted for a deficit of around 4 per cent of gross domestic product in 2026. The issue is, therefore, not whether a government runs a deficit. The issue is whether borrowed resources are directed towards productive investment and long-term development.
Unfortunately, much of the current debate has focused on arithmetic while ignoring philosophy. In doing so, critics risk missing what may be the most important feature of this budget: its attempt to link investment, revenue generation and human wellbeing within a single development framework.
GDP could not measure
DURING the parliamentary budget session and at many seminars and round-table discussions that followed, much of the criticism focused on the government’s GDP growth target of 6.5 per cent for the 2026–27 financial year. Whether that target is realistic is a legitimate question. Yet, the intensity of the debate also reveals how deeply the economic discourse remains fixated on a single indicator, often at the expense of broader questions about institutional reform, revenue mobilisation, governance and human well-being.
During the years of the Awami League governance, Bangladesh was presented with a powerful narrative of economic success. Domestic product was rising. Per capita income was increasing. Large-scale projects were transforming the landscape. International institutions praised the country’s economic performance while policy-makers pointed to growth figures as a proof that Bangladesh was firmly on its path to prosperity.
On paper, the story appeared convincing. Yet, beyond conference halls and policy reports, another Bangladesh existed. It was a Bangladesh where farmers struggled to recover production costs, families were pushed into poverty by medical emergencies and graduates found degrees no guarantee of employment. Tax evasion became normalised, banks were weakened by fraud and thousands of crores disappeared through corruption, money laundering and capital flight.
These were not isolated failures. They were symptoms of a development model that often prioritised headline growth statistics over institutional strength, accountability, human wellbeing and economic inclusion. If the growth story was as successful as advertised, why did so many citizens feel excluded from its benefits? These questions expose a fundamental weakness not only in Bangladesh’s development discourse but also in the way many developing countries have measured progress.
GDP measures economic activity, but it does not measure dignity, fairness, security, trust or hope. Development is about expanding opportunities, strengthening human capabilities and improving the quality of life. Economists Joseph Stiglitz and Jean-Paul Fitoussi have argued that gross domestic product alone is an inadequate measure of national progress and well-being. Gross domestic product can tell us how large the economic pie has become. What it cannot tell us is who gets to eat it.
Global search for better measures
EVEN the architects of growth eventually recognised these limitations. China’s former premier Li Keqiang reportedly placed greater emphasis on electricity consumption, freight transport and bank lending than on headline GDP figures when assessing economic conditions. Economic reality, he understood, is often more complex than the statistics used to describe it. That realisation has transformed development thinking globally.
The United Nations uses the Human Development Index. The OECD has developed its Wellbeing Framework. Bhutan famously introduced Gross National Happiness.
All emerged from the same conclusion: economic growth matters; but growth alone is not enough. Many are asking whether the government’s projected GDP growth target is realistic. It is a fair question. But, it is also revealing that so much of the debate has become fixated on a single number. The more important question is whether the economy is moving in the right direction.
Vision beyond growth
THIS is why I believe the most interesting aspect of the 2026–27 budget is not its deficit, borrowing requirement or ambitious revenue target. At its core, this budget reflects an emerging economic vision. That vision rests on three interconnected pillars: creating an environment conducive to investment, expanding the state’s revenue base and improving human well-being.
For too long, Bangladesh attempted to pursue these objectives separately. Governments sought growth without sufficiently addressing well-being. They expanded spending without adequately broadening the tax base. They promised social protection while tolerating an economy where large segments of wealth remained outside the formal revenue system.
This budget attempts something more ambitious. Investment creates growth. Revenue creates state capacity. Well-being creates social stability and human potential. Remove any one of these pillars and the model becomes unstable.
Investing in human security
THIS broader vision is perhaps most visible in the budget’s emphasis on social sector development. The Tk 9.38 trillion budget allocates record levels of funding for health and education as shares of gross domestic product, signalling a recognition that human development is not a by-product of growth but one of its foundations.
The same philosophy can be seen in the expansion of family card programmes, debt relief for struggling farmers, strengthened social protection measures, women’s mobility initiatives such as the proposed pink bus service and increased support for vulnerable communities. Viewed through a conventional economic lens, these may appear to be welfare expenditures. Viewed through the lens of well-being, they are investments in human security.
A farmer freed from unmanageable debt, a low-income family protected from economic shocks or a woman able to travel safely to work experiences development in ways that GDP statistics cannot capture. Security, dignity, mobility and hope may not appear in conventional growth calculations, but they are essential ingredients of a prosperous and stable society.
Members of the opposition have portrayed the budget as anti-people, yet some of its most controversial tax measures are aimed not at ordinary citizens but at wealthier segments of society. A new surcharge on very high levels of personal wealth and a withholding tax on elite club memberships suggest an effort, however limited, to ensure that those with greater capacity contribute more to the state’s revenue base. Whether these measures generate substantial revenue remains to be seen. But, they challenge the long-standing perception that taxation in Bangladesh is enforced most effectively on those least able to avoid it.
In that sense, I see echoes of the spirit of the July uprising in this budget. At its core, the movement was not merely a demand for political change, it was also for a demand for a more equitable social and economic order. No budget can eliminate inequality overnight. Yet, attempts to broaden the tax base upward, strengthen social protection and expand opportunities for those historically left behind reflect, at least in principle, an aspiration toward a less unequal Bangladesh.
Revenue question
ONE of the most important yet least discussed aspects of the budget is its focus on revenue reform. Bangladesh continues to have one of the lowest tax-to-GDP ratios in Asia while tax evasion remains deeply embedded in the economic culture. The result is a state expected to deliver modern public services with limited resources. This is why the push towards a more digital and less cash-dependent economy may prove to be one of the budget’s most consequential reforms. In a country where cash transactions often facilitate under-reporting of income and tax avoidance, expanding digital payments is not merely a technological upgrade. It is simultaneously a governance, anti-corruption, revenue and state-building reform. If implemented effectively, it could strengthen tax compliance, improve transparency and bring large segments of the informal economy into the formal sector.
Untapped power of culture
THE budget also hints at another overlooked opportunity: culture. Hollywood contributes billions of dollars to the American economy. Bollywood has become a major economic engine for India. South Korea transformed music, film and digital content into global industries.
Bangladesh possesses enormous untapped potential in film, music, OTT platforms, animation and digital content. In the twenty-first century, creativity has become an economic asset.
Visionary budget
WILL every target set out in this budget be achieved? Probably, not. Will the government collect every taka it hopes to raise? History offers little reason for confidence. But those are not the most important questions.
The more consequential question is whether the government has correctly identified the structural constraints that have long held Bangladesh back and whether it possesses the political will to address them. For decades, successive governments celebrated GDP growth while postponing difficult reforms and tolerating an economy shaped by informality, weak tax compliance and limited accountability.
This budget attempts a different course. It seeks to bring economic activity out of the shadows, broaden the tax base, strengthen state capacity and expand social protection. In doing so, it challenges practices and incentives that have distorted Bangladesh’s political economy for years.
Even if only part of these reforms is successfully implemented, Bangladesh could emerge with a more transparent economy, a stronger revenue foundation and greater capacity to invest in its future.
For that reason, this budget should not be judged solely by whether every target is met. It should be judged by whether it succeeds in shifting the trajectory of the state.
That is why this budget may prove to be more than an annual fiscal statement. It may mark the beginning of a broader debate about development, inequality and the kind of state Bangladesh aspires to become.
Kazi Jesin is a journalist and political commentator.
