The Bangladesh government has finalized the size of the Annual Development Programme (ADP) for the upcoming 2025-26 fiscal year at a record-breaking Tk 2.30 trillion, reflecting its continued commitment to infrastructure expansion, social development, and economic growth amid global and domestic challenges.
The Planning Commission, in coordination with the Ministry of Finance and various implementing agencies, has outlined the priorities of this massive development budget. The ADP - the key public investment plan - will channel funds into transportation, energy, education, health, and digital transformation. This is a significant increase from the Tk 2.28 trillion allocated in the revised ADP of FY2024-25, underscoring the government’s intent to maintain a high level of capital expenditure.
This development budget will be officially placed for approval at the upcoming meeting of the National Economic Council (NEC), expected to be chaired by Prime Minister Sheikh Hasina later this month.
Aiming for Growth and Stability: The record Tk 2.30 trillion ADP comes at a time when Bangladesh is grappling with global economic uncertainty, currency pressures, and the lingering effects of inflation. Despite these challenges, the government has opted to push forward with bold development spending, signaling confidence in the country’s economic fundamentals.
Planning Commission officials emphasized that the goal is to sustain the momentum of economic recovery, job creation, and poverty reduction. “We are focusing on completing ongoing mega projects, strengthening rural infrastructure, and investing in people-centric sectors like health and education,” said a senior Planning Commission member. “This is a forward-looking ADP that targets both growth and inclusion.”
Breakdown of Funding Sources: Of the Tk 2.30 trillion, Tk 1.53 trillion will come from the government’s own resources (GoB), while the remaining Tk 770 billion is expected to come from project aid - primarily in the form of loans and grants from development partners such as the World Bank, Asian Development Bank (ADB), Japan International Cooperation Agency (JICA), and China.
This ratio of domestic and foreign resources reflects a moderate reliance on external borrowing, in line with the government’s strategy to maintain debt sustainability while leveraging low-cost financing for infrastructure and reform projects. Finance ministry officials have noted that aid disbursement is expected to accelerate, especially for projects in energy, transport, and urban development.
Sector-Wise Allocation: The ADP focuses on a few key sectors that together account for the majority of the allocation: Transport and Communication: Tk 640 billion, Power and Energy: Tk 310 billion, Education and Technology: Tk 270 billion, Health: Tk 165 billion, Rural Development and Agriculture: Tk 180 billion, Water Resources and Climate Resilience: Tk 100 billion,
ICT and Digital Transformation: Tk 90 billion: This sectoral allocation reflects Bangladesh’s twin priorities of physical infrastructure and human capital development. One of the most significant chunks will go to road and railway infrastructure, with a push to complete major projects such as the Dhaka-Chattogram Expressway, Padma Bridge Rail Link, and ongoing metro rail expansions in Dhaka and Chattogram.
Priority on Ongoing Projects: One key feature of the upcoming ADP is its strong emphasis on completing ongoing projects rather than initiating too many new ones. This comes in response to criticism from economists and development experts who have repeatedly pointed out the slow pace of implementation and the proliferation of underperforming projects.
Out of the roughly 1,300 projects included in the new ADP, over 1,000 are ongoing. Only around 200 are new, most of which are critical in nature or aligned with government strategic goals such as Vision 2041 and the Eighth Five-Year Plan.
According to the Implementation Monitoring and Evaluation Division (IMED), prioritizing ongoing projects will help improve the utilization rate of ADP funds, which has remained below target in recent years.
Key Mega Projects to Receive Major Funding: Several mega projects are expected to receive the lion’s share of the funding: Rooppur Nuclear Power Plant, Dhaka Mass Rapid Transit (MRT) Lines 1 and 5, Hazrat Shahjalal International Airport Expansion (3rd Terminal), Padma Bridge Rail Link, Matarbari Deep Sea Port, Bangabandhu Sheikh Mujib Hi-Tech Parks in multiple districts. These projects are expected to serve as catalysts for long-term growth, boosting connectivity, trade capacity, and technology-driven employment.
Climate Resilience and Sustainability: In line with its international commitments and growing climate vulnerabilities, the government has allocated Tk 100 billion in the ADP for water resources management, climate resilience, and disaster preparedness. This includes embankment upgrades in coastal regions, river dredging, and flood control projects.
Additionally, projects aimed at promoting renewable energy, green cities, and environmental conservation have been included under the energy and rural development sectors.
Implementation Challenges Remain: Despite the ambitious size and intent of the ADP, concerns persist about the implementation efficiency of government projects. Historically, ministries and agencies have struggled with timely project execution due to procedural bottlenecks, land acquisition delays, lack of technical capacity, and corruption.
According to a recent IMED report, the average ADP implementation rate hovers around 70-75%, and many large projects overshoot both time and cost estimates. To address this, the government has pledged to strengthen the Public Investment Management (PIM) framework and enforce stricter monitoring of project execution. A dedicated project tracking dashboard is also in the pipeline.
Experts Weigh In: Economists and policy analysts have responded cautiously to the size and structure of the ADP. While many have welcomed the government’s focus on infrastructure and job creation, they urge greater transparency and efficiency.
S R Gagan, a financial analyst said: “The ADP must not just be big - it must be smart. Prioritizing high-impact, high-return projects and improving implementation is key. Otherwise, we risk wasting valuable public resources.”
Similarly, Dr. Selim Raihan, Professor of Economics at the University of Dhaka, noted that while the ADP is aligned with long-term development goals, financing and capacity challenges could dampen its effectiveness. “We need to improve coordination between ministries, reduce bureaucratic delays, and ensure quality assurance in project design and delivery,” he said.
Alignment with Vision 2041: The Tk 2.30 trillion ADP is seen as a critical instrument to advance the government’s Vision 2041 - a roadmap to transform Bangladesh into a high-income country by that year. The ADP supports this vision by investing in infrastructure, innovation, and inclusive development.
The upcoming fiscal year will be the penultimate year of the Eighth Five-Year Plan (2021-2026), and as such, the ADP is designed to fast-track progress on key targets, including GDP growth, export diversification, urbanization, and social safety.
If executed effectively, the ADP could play a pivotal role in positioning Bangladesh for its eventual graduation from Least Developed Country (LDC) status by 2026 and its transition to an upper-middle-income economy shortly thereafter.
Ambitious Thoughts: Bangladesh’s decision to allocate Tk 2.30 trillion for the 2025-26 ADP reflects both ambition and resilience. At a time of uncertain global economic trends, the country is choosing to invest in its future through strategic development spending. While the challenges of execution and financing remain, the scale and scope of the ADP signal the government’s determination to accelerate progress and build a stronger, more inclusive economy.
With strong political will, improved governance, and support from development partners, the ADP has the potential to deliver meaningful results - transforming infrastructure, creating jobs, and improving the quality of life for millions of Bangladeshis.
The government has finalized the size of the Annual Development Programme (ADP) for the 2025-26 fiscal year at Tk 2 lakh 30 thousand crore, reflecting a significant cut of Tk 35 thousand crore compared to the original allocation for the current fiscal year. The move comes in the wake of tighter fiscal constraints and shifting economic priorities.
The decision was made during an extended meeting of the Planning Ministry held on Tuesday, chaired by Planning Advisor Wahiduddin Mahmud. The finalized draft ADP will now be placed before the National Economic Council (NEC) later this month for final approval, under the leadership of Chief Advisor Professor Muhammad Yunus.
This year’s ADP reflects a mix of fiscal austerity and strategic prioritization, with the government continuing to focus on infrastructure development, energy security, education, and healthcare - key pillars of the country’s development roadmap.
Substantial Cut in ADP Allocation: The reduction in ADP size is one of the largest in recent years. In the 2024-25 fiscal year, the government had initially allocated Tk 2 lakh 65 thousand crore for development projects. However, the implementation challenges and fiscal tightening eventually led to a revision, prompting policymakers to adopt a more realistic approach for the upcoming fiscal year.
The finalized size of Tk 2.30 lakh crore indicates a 13.2% decrease from the original budget of the current year. This decision underscores the government’s intention to align its development agenda with available resources, particularly amid rising global economic uncertainties, external debt obligations, and domestic revenue shortfalls.
Funding Sources: Local and Foreign Contributions: The upcoming ADP will draw Tk 1 lakh 44 thousand crore from local sources, while the remaining Tk 86 thousand crore will come as project assistance from development partners. This composition highlights the government’s ongoing reliance on foreign aid and concessional loans to fund its development ambitions.
The Planning Commission has stated that 1,142 development projects have been included in the draft ADP. These projects are expected to support Bangladesh’s broader Vision 2041 goals, including poverty reduction, infrastructural transformation, and sustainable growth.
Sector-wise Allocation: Prioritizing Infrastructure and Social Services: Despite the overall reduction, several sectors have received relatively high allocations, reflecting the government’s strategic priorities. Among these, transport and communication has once again emerged as the most prioritized sector.
Top Sectoral Allocations:Transport and Communication - Tk 58,973 crore, Power and Energy - Tk 32,392 crore, Education - Tk 28,557 crore, Housing and Community Facilities - Tk 22,776 crore, Health - Tk 18,148 crore, Local Government and Rural Development - Tk 16,472 crore, Agriculture - Tk 10,795 crore, Environment, Climate Change, and Water Resources - Tk 10,641 crore, Industry and Economic Services - Tk 5,380 crore, Science and Technology - Tk 3,894 crore.
The top three sectors - transport, energy, and education - together account for nearly 51% of the total ADP allocation, highlighting their continued strategic importance in the government’s development vision.
Transport and Energy: Foundations of Economic Growth: The largest allocation of Tk 58,973 crore to the transport and communication sector underscores the government’s commitment to expanding road, rail, and maritime connectivity across the country. Major infrastructures projects - including bridges, expressways, and mass rapid transit systems - are expected to receive the bulk of this funding.
Similarly, the power and energy sector, with an allocation of Tk 32,392 crore, remains a cornerstone of the ADP. The government aims to enhance national energy security by investing in renewable energy, expanding the transmission network, and modernizing outdated infrastructure.
Education and Health: Strengthening Human Capital: The education sector has been allocated Tk 28,557 crore, making it the third highest recipient in the new ADP. The funds will go toward improving educational infrastructure, curriculum modernization, teacher training, and expanding digital learning facilities - particularly in underserved rural areas.
The health sector, often overlooked in previous budgets, has seen a relatively robust allocation of Tk 18,148 crore. The post-pandemic reality has prompted greater attention to public health infrastructure, hospital upgrades, community clinics, and healthcare workforce development.
Environmental and Climate Commitments: Recognizing the growing threat of climate change, the government has earmarked Tk 10,641 crore for projects related to environment, climate resilience, and water resource management. This includes efforts to mitigate river erosion, improve urban drainage systems, and enhance early warning systems for climate-related disasters.
Agriculture and Rural Development: Ensuring Food Security: To support food production and rural livelihoods, the agriculture sector has been allocated Tk 10,795 crore, while Tk 16,472 crore has been directed to local government and rural development initiatives. These investments are expected to improve irrigation, rural roads, farm mechanization, and access to markets for farmers.
Science, Industry, and Innovation: Although these sectors received relatively modest allocations, the government has continued to fund science and technology (Tk 3,894 crore) and industry and economic services (Tk 5,380 crore). These investments are aimed at promoting innovation, industrial diversification, and digital transformation - areas that are critical for future economic resilience.
Implementation Challenges and Future Outlook: While the ADP reflects well-planned priorities, experts caution that implementation capacity, bureaucratic bottlenecks, and corruption remain significant challenges. Historically, only a portion of the allocated ADP is fully implemented each year due to delays in project approvals, fund disbursement, and coordination among agencies.
Planning officials have acknowledged the need for greater transparency, efficient project management, and stricter monitoring mechanisms to ensure timely and effective use of ADP funds.
Additionally, with the rising debt servicing burden and uncertain external financing conditions, Bangladesh’s development strategy must remain adaptive and resilient. The reduction in ADP size can also be seen as a prudent step to avoid fiscal overstretch while maintaining focus on core priorities.
The Annual Development Programme for FY 2025-26, with a size of Tk 2 lakh 30 thousand crore, reflects the government’s attempt to balance fiscal responsibility with continued investment in critical sectors. While the size has been reduced significantly, the emphasis on transport, energy, education, health, and environment signals a commitment to long-term, inclusive development.The coming months will be crucial in translating these budgetary plans into on-the-ground progress. As Bangladesh moves toward becoming an upper-middle-income country, the effective execution of this ADP will be keys to achieving sustained economic growth and improving the quality of life for millions.
