The national election scheduled for 12 February is extremely important for Bangladesh from both political and economic perspectives. This is because elections have not been able to serve as a genuine means of expressing the people's will for a long time.
The lack of participation from opposition parties, allegations of vote rigging, and the mere formality of holding elections have weakened democratic institutions and strengthened authoritarian governance.
An entire generation has been denied the opportunity to exercise their right to vote, leading to decreased public interest in politics, weakened accountability, and diminished trust in state institutions. This election presents a historic opportunity to move away from that situation.
However, simply ensuring a fair election will not solve all problems. The upcoming government will inherit a weak and pressured economy, where years of policy neglect, institutional weaknesses, and poor economic management have disrupted order.
Over the past 16 years, the lack of pressure on political leadership to maintain the economic condition for everyone has also harmed economic discipline.
In recent years, Bangladesh's economic momentum has slowed. Growth has decreased, inflation has been high for a long time, and the banking sector is burdened with non-performing loans. Private and foreign investments are low, public investment is often inefficient and wasteful, government debt has increased, real income is declining, and job creation has significantly decreased. These factors have created long-term pressure on the economy.
In this challenging reality, the new government must undertake major reform programmes to restore economic discipline, strengthen good governance, and improve the living standards of ordinary people. There is much to be done, but three things are most crucial and are closely linked with each other.
First, controlling inflation should be the top priority for the elected government. In recent years, the increase in food and energy prices has led to high inflation. More than half of the total expenses of low-income people go towards food. As a result, when food prices rise, their standard of living is severely affected.
With wage increases lagging behind inflation, people's real income has declined, savings have decreased, and middle-class households have been forced to cut expenses on education, healthcare, and nutrition. High inflation is also detrimental to the overall economy. It increases business uncertainty, reduces long-term investment, puts pressure on the currency, and diminishes public confidence in economic management. This is evident now.
Global factors as well as domestic policy weaknesses are responsible for inflation. Increases in international market prices have raised import costs. Although fuel prices have been kept low for a long time, they have increased significantly in recent years, raising production costs. Increased government borrowing from banks has also added to inflationary pressures. Additionally, the lack of competition, hoarding, and weaknesses in transportation systems have hindered food supply.
The new government must adopt a credible and coordinated strategy to control inflation. The Bangladesh Bank should be allowed to perform its inflation control duties independently. Interest rates and monetary policy need to be aligned with the real economy. Government borrowing from banks to cover deficits should be reduced, and revenue collection should be increased.
Competition in the food market needs to be enhanced, syndicates and hoarding should be stopped, conservation and transportation infrastructure should be improved, and agricultural production should be increased. A transparent and rule-based method for fuel price determination is necessary to prevent sudden price shocks.
Second, private investment is extremely vital for increasing growth, productivity, and employment; however, private investment has stagnated in recent years. Although public investment has increased, questions arise regarding the quality and efficiency of many projects. Foreign investment is also lower compared to neighbouring countries. Policy uncertainty, complex regulations, weak contract enforcement, infrastructure problems, bureaucratic complexities, and a weak banking sector have eroded investor confidence.
The banking sector currently cannot play a supportive role for investment. Due to political influence, weak governance, and repeated loan rescheduling during the previous government, the discipline in loan management has deteriorated. It has been observed that good companies do not get loans, yet influential figures get loans easily.
Thus, governance in the banking sector needs to be strengthened, recovery of non-performing loans ensured, asset quality assessments of banks completed, and weak banks reformed. Simultaneously, the business environment needs to be made easier, government services digitalised, and the tax system simplified. Infrastructure development should focus on not just large projects but also efficiency and reliability. Weaknesses in power, ports, customs, and logistics increase business costs and reduce export competitiveness.
Third, creating employment for the youth is the biggest challenge of this decade. Every year, approximately 2 million young people enter the labour market, but jobs are not being created accordingly. Youth unemployment is more than double the national average. Most new jobs are informal, low-paying, and less productive. Educated unemployment is increasing, reflecting the significant gap between education and the labour market.
Job creation depends on economic stability and increased investment. High inflation reduces wages and creates employment barriers. Therefore, a stable economy and business-friendly environment are essential.
Education and training need to be aligned with industry demands. There is a need for a major expansion in technical and vocational education. Easy access to credit for small and medium entrepreneurs and simplification of regulations are necessary.
Finally, the February 2026 election is not just about who will govern the country. How the country will be governed is also crucial for Bangladesh. Ensuring economic discipline, leadership, and accountability alongside democracy is essential. The decisions of the new government will determine the future of a generation. Leading the country with courage and responsibility can usher Bangladesh into a new chapter of stability, opportunity, and trust.
#Fahmida Khatun is Executive Director, Centre for Policy Dialogue (CPD)
* The opinions are the author's own.
#This article, originally published in Prothom Alo print and online editions, has been rewritten in English by Rabiul Islam