The post-election government will face its biggest challenge in reviving investment and creating jobs, according to leading think tank Centre for Policy Dialogue (CPD). The research organisation also stressed that controlling inflation must be the new administration's top priority.
These observations were made at a press conference titled “Multidimensional Risks in Bangladesh's Economy at the Electoral Crossroads” held on Saturday at CPD's office in Dhanmondi, Dhaka.
CPD Executive Director Dr Fahmida Khatun presented the keynote paper, while the organisation's Distinguished Fellow Dr Mustafizur Rahman and Research Director Khandaker Golam Moazzem were also present.
Investment stagnation a major concern: Dr Fahmida Khatun said the current stagnation in investment poses a serious challenge for the new government. “Investment is not increasing due to high bank interest rates and political uncertainty. Both domestic and foreign investors are holding back,” she said. She warned that if investment fails to pick up, inequality and social unrest will rise. “If society does not ensure fair opportunities, it creates inequality on one hand and instability on the other,” she said.
Economic pressure behind July movement: Referring to the mass movement in July 2024, Dr Fahmida said economic hardship played a key role behind the protests. “There were no jobs in the market. Government jobs became the only hope, and even there people faced quota-related complications. On top of that, inflation was high,” she explained. “All these factors together created immense economic pressure in people's lives, which ultimately contributed to the July movement,” she added.
She cautioned that unless Bangladesh overcomes the current investment deficit, these problems will persist.”If we fail to break out of this investment slowdown, the same problems will continue to haunt us,” she said.
Youth population seen as key strength: Dr Fahmida highlighted Bangladesh's young population as the country's greatest strength. “Bangladesh is still a young nation. The average age of our population is only 26 to 27 years,” she said. “If we can properly utilise this energetic young generation, the economy will regain momentum,” she added. She also pointed out that young people are best equipped to adapt to technological changes.
“We are living in an era where technology is transforming every aspect of life. Young people have the highest capacity to adapt to these changes,” she said.
Expectations from upcoming election: Responding to questions about election-related challenges, Dr Fahmida said it is the Election Commission's responsibility to ensure a free, fair and inclusive election.
“We want the next election to be neutral and participatory. There are guidelines to prevent misuse of money, and every candidate must follow them,” she said. She stressed that elections should not be dominated by excessive spending. “The spread of money in elections must be stopped,” she said.
Most importantly, she said the election must be held in a violence-free environment. “We want an election where people can go to polling centres safely and cast their votes without fear,” she added.
Debt burden rising: CPD Distinguished Fellow Dr Mustafizur Rahman said the country's debt burden-both domestic and foreign-is increasing rapidly. “Interest payments on loans have now become one of the largest components of the national budget,” he said. “This pressure is rising continuously, creating a risk that Bangladesh could fall into the middle-income trap,” he warned.
Call for urgent reforms: CPD researchers present at the event emphasised the need for urgent reforms to revive investment, generate employment and restore macroeconomic stability.
They called on the new government to prioritise inflation control, improve the business climate, strengthen governance, and ensure political stability to attract both local and foreign investors. The press conference was attended by CPD researchers from various levels, journalists and policy analysts, who welcomed the think tank's timely assessment of the country's economic challenges.
