Let me begin with a story. Several years ago, I attended a workshop in Dhaka where one of the sessions featured a leading businessman of the country. It was an hour-long session in which, during the first 30 minutes, he described what a typical working day looked like for him. Much of his day, he said, was spent not on figuring out how to increase productivity, branch into new products, or explore new export markets. Instead, it was consumed by navigating regulatory hurdles.
His day began with a visit to the tax office to argue over import valuation issues. Then, after a hurried lunch, he had to navigate Dhaka’s atrocious traffic to reach the regulator’s office for a factory operating licence. Despite building the factory, installing machinery, and training workers, he could not begin operations without the licence. After three months and multiple document submissions, additional requirements kept delaying progress. Frustrated, he questioned why the office had not informed him earlier about the missing documents, highlighting the persistent bureaucratic delays that hinder business development.
There was more he had to endure on a typical day, but the above episode is enough to understand what was on Finance Minister Amir Khasru Mahmud Chowdhury’s mind when, in an interview soon after taking office, he talked about Bangladesh becoming “an over-regulated country.” He also stated his government’s desire for “serious deregulation” and liberalisation.
The idea of removing redundant procedures, simplifying compliance, and eliminating rules that no longer serve a clear purpose should be welcome news for businesses in Bangladesh. Whether local or foreign, large or small, firms consistently raise concerns about the difficulties and delays they face in dealing with regulations. The 2022 Enterprise Survey by the World Bank indicates that senior management in Bangladeshi firms spend 13.3 percent of their time dealing with the requirements of government regulation, compared to 8.2 percent in lower-middle-income countries (LMICs). It also takes an average of 48.8 days to obtain an import licence, compared to 17.9 days in LMICs.
Being a businessman himself, the minister surely knows where the shoe pinches. When undertaken thoughtfully, deregulation can indeed reduce compliance costs and delays, lower barriers for small and medium enterprises, improve transparency and predictability, and enhance competitiveness and investment.
But that is only one side of the story. Consider the experience of Uber when it launched its services in Dhaka in 2016. At the time, the rulebooks covered traditional taxis and rental cars but had no provision for app-based ride-sharing. Regulators were uncertain how to classify Uber drivers. Thus, like many other businesses in Bangladesh, Uber operated for a time in a regulatory grey area, tolerated by the authorities while serving customers, until the government introduced the Ride-Sharing Service Guidelines. These guidelines formally recognised and regulated app-based transport services, integrating them into the legal framework.
Such examples show that entrepreneurs seeking to introduce new ways of doing business often face additional regulatory barriers because regulators are slow to respond to innovation in the economy. For those seeking to deploy new technologies or business models, the problem is not excessive regulation but rather the absence of clear rules. There is also the issue of weak enforcement of sound regulations, which imposes significant burdens on society. Think of a consumer buying food from a market stall with no assurance of safety standards, or a construction project proceeding without proper oversight, putting workers and future occupants at risk.
Finally, businesses face uncertainty because rules are interpreted inconsistently and sometimes changed without warning. A crisis—such as a factory disaster or deaths from food contamination—may prompt the imposition of new regulations. This is understandable; governments must act when in crisis. But hurried regulation often creates confusion. Reflexive or knee-jerk rule-making, adopted without adequate analysis, can undermine credibility, encourage corruption, and discourage investment.
Thus, any deregulation drive from the government should be defined broadly, focusing on more systemic and ambitious reforms to enhance regulatory predictability. It should be a regulatory governance programme, not just a deregulation exercise. Such reform must also rest on a strong institutional foundation. Our regulatory reforms have traditionally been piecemeal, targeting individual processes and procedures. Reform efforts are often seen to begin with urgency and fanfare but eventually fade in the absence of sustained institutional backing. Committees submit reports. Task forces propose changes. Over time, momentum dissipates.
There is a risk that the proposed deregulation will follow a similar path, which will be unfortunate considering how urgent it has become to build a truly modern regulatory regime in Bangladesh.
We need to think about a permanent institutional mechanism, such as a Regulatory Reform Commission or a Regulatory Reform Unit located in the Prime Minister’s Office. This should be a technically competent regulatory governance body tasked with reviewing and streamlining existing rules, promoting regulatory impact assessments for proposed regulations, simplifying compliance procedures, coordinating reforms across ministries, and identifying emerging regulatory needs. It should also assess the outcomes of reform efforts. Businesses will judge the success of these efforts not by the number of amended laws or digitised procedures, but by tangible results: whether compliance is genuinely easier, predictability has improved, and regulatory effectiveness has strengthened.
Countries as diverse as South Korea and Mexico have established such institutions as they sought to transition from ad hoc regulatory reform efforts to more structured approaches. In its budget unveiled in February 2025, the Indian government also announced the formation of a similar body.
The goal is not necessarily to regulate less. Businesses are not really asking for a regulation-free economy, but a well-regulated one. So, deregulation, yes, but we also need smart regulation and a systematic approach to reform. Ad hoc, piecemeal measures, as in the past, will not take us far.
Syed Akhtar Mahmood is an economist and author with three decades of experience in global investment-climate policy and regulatory reform.
Views expressed in this article are the author's own.
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