Bangladesh needs an investment-driven development model tailored to domestic realities and evolving global geoeconomic conditions, Prime Minister's Finance and Planning Adviser Dr Rashed Al Mahmud Titumir said on Friday, outlining the government's economic strategy.
"We need to pursue a model where investment leads to production, production creates employment, employment increases revenue without raising tax rates, and that revenue finances education, health and social security," he said.
The economist made the remarks during a session at the Bengal Delta Conference 2026 (BDC 2026), moderated by Mushtaq Khan, professor of economics at SOAS University of London.
The conference, themed "Bangladesh and a Changing World: Uncharted Times, Emerging Orders, and the Politics of Care", comes at a time of transition for both Bangladesh and the global order.
Titumir reiterated the government's commitment to gradually increasing spending on education, healthcare and social protection while moving towards what he described as a democratic welfare state.
He said the government is working to introduce a universal lifecycle-based social security system to protect vulnerable people from falling into poverty during economic shocks.
The adviser also underscored the need to reform the education and healthcare sectors, saying the focus would be on skills development, citizenship education, innovation and building a national healthcare system that reaches grassroots communities.
Highlighting the government's reform agenda, Titumir said legitimacy, accountability and transparency would remain at its core.
"If you have a government with legitimacy, you have accountability," he said, adding, "The delivery is about legitimacy. The delivery is accountability. The delivery is transparency."
He said the government inherited a fragile fiscal situation but now has both the political mandate and the responsibility to pursue transformative reforms.
"We all are aware of what we inherited. The fiscal condition we inherited was fragile," he said.
"There is an overwhelming majority in Parliament, which means that we have more responsibility, and we have to have a transformative change."
On revenue mobilisation, Titumir said the government is prioritising institutional reforms rather than increasing tax rates.
"The equation that the current government is working on has two additional elements which were ignored for years – the constant and the error term," he said.
He explained that the "constant" represents institutional strength, while the "error term" refers to corruption, rent-seeking and excessive tax exemptions.
According to him, reducing leakages and strengthening enforcement have already yielded positive results.
"For the first time in the history of Bangladesh, Chattogram Customs House made a huge contribution," he said, adding that three task forces had been formed to improve revenue collection.
Acknowledging the challenges that remain, he said the government is not claiming to have solved every problem.
"We are not fully equipped yet to deal with tax evasion. That requires capabilities," he said.
On the financial sector, Titumir said the government is addressing long-standing issues, including non-performing loans and bank recapitalisation.
"We are not hiding anything under the carpet. We are aware of the issues, and we are dealing with them," he said.
He also pledged to end what he described as the "auction market" for Statutory Regulatory Orders (SROs), where influential groups received discretionary tax concessions.
"We have inherited what is known as an auction market for SROs. If you are powerful, you get an issuance of an SRO, and you get all those resources," he said.
"These arbitrary concessions, we are working on them, and we are making sure that this SRO culture is not there."
The adviser said taxation and public spending decisions should be determined by Parliament rather than discretionary executive actions.
"It is the sovereign Parliament that would decide where and how the money would be collected and where the money would be spent. This is the key essence of the reform of the government," he said.
Calling industrialisation critical to Bangladesh's long-term resilience, Dr Titumir said the country has revived discussions on industrial policy after years of neglect.
"Industrial policy is back in Bangladesh," he said, adding that expanding productive capacity, ensuring energy security, improving competitiveness and diversifying exports would be essential as Bangladesh prepares to graduate from the Least Developed Country (LDC) category in 2029.
Expressing optimism about the reform agenda, he said the government expects to deliver tangible results during the current fiscal year.
"This fiscal year, you would get the early harvest," he said. "We are hopeful that Bangladesh, what we have promised, we would deliver."
"We had to spend $3.46 billion for nothing to do with us," he said, adding that the government had to strike a balance between maintaining fiscal discipline and protecting agriculture and consumers from rising fuel costs.