Urgent Action Needed to Stem Rising Poverty

The number of poor people in Bangladesh is rising rapidly. Nearly 2.1 million people fell below the poverty line in the 2025-26 fiscal year, according to the World Bank’s Bangladesh Development Update released last Tuesday. The report offers little evidence of economic progress and instead paints a bleak picture of the country’s economy. It warns that another economic downturn could push around 62 million people below the poverty line. This means millions are standing on the edge of poverty and struggling desperately to avoid falling into it. With economic growth currently at 3.4 percent, even a modest recovery would leave Bangladesh with one of the weakest growth rates in South Asia. In other words, the report offers little economic good news. The country’s economic distress is already evident without the report. Rising inflation, soaring prices of essentials, higher gas, electricity and fuel costs, declining incomes, job losses, factory closures and layoffs to cut costs all reflect the harsh reality.

Bangladesh has not escaped the effects of the global economic downturn. Before the country could recover from the fallout of the Ukraine war, the Iran war created another major shock. Reduced production and supply from Middle Eastern countries, among the world’s key sources of fuel, have destabilised the global economy. Bangladesh has also felt the consequences. Fuel and gas shortages have disrupted industries, transport and power generation. The government has repeatedly raised fuel prices and has had to spend huge sums buying fuel from alternative sources. This economic reality cannot be ignored. Yet the burden imposed on ordinary people has been devastating. There is hardly a basic necessity, including food, whose price has not risen beyond their reach. Many are struggling even to afford two proper meals a day. Those who have incomes can no longer sustain their families on what they earn. Soaring gas, electricity and fuel prices have pushed the cost of everything to unbearable levels. The poor are increasingly desperate. Lower-income households are slipping into poverty, while countless middle-class families are being pushed into the lower-income bracket. The crowds gathering at government trucks selling subsidised TCB goods are evidence of the hardship.F2

People living on limited incomes are under the greatest pressure. A gas cylinder that once cost Tk 1,300-1,400 now costs Tk 1,800-2,000. Monthly electricity bills that once stood at Tk 1,000-1,500 have risen to an average of Tk 2,500-3,000, alongside complaints of inflated bills. Rents have also risen beyond what many can afford. Ordinary people are therefore far from well. While the cost of daily life has surged, their incomes have not increased by even a single taka. They are struggling to meet basic costs for food, education, healthcare and housing. Savings have been exhausted. Many are mortgaging or selling land and homesteads. Some can no longer afford their children’s education or marriage expenses. Unable to balance income and expenditure, many are sinking into deep despair. Crime is rising, unemployment is pushing people towards criminal activity, and families and communities are becoming increasingly unstable. The plight of day labourers and workers needs little explanation. Internationally, a daily income of US$3, or Tk 366, is considered the poverty threshold. As the number of people able to earn that amount each day declines, poverty is rapidly increasing.

The government has taken various measures to achieve sustainable economic development, but their benefits will take time to materialise. The immediate crisis, however, cannot be postponed. Millions are at risk of falling below the poverty line, while hundreds of thousands have already done so. Failure to address this situation will create long-term damage and slow economic progress. Concerned sections of society say the finance minister has failed to adequately address the economic and living conditions of ordinary people. The priority should have been to ensure economic protection for low-income and poor households and prevent further increases in poverty and unemployment. There should have been a plan to shield vulnerable people from the impact of rising prices. The government explains why it must raise gas, electricity and fuel prices, but offers little indication of how ordinary people are expected to cope with the resulting rise in the cost of essentials or increase their incomes. This is where government action appears lacking. Raising prices of essential goods is easy and cannot be considered an achievement. Government success should instead be measured by its ability to reduce or stabilise prices. Whatever progress the government has achieved has been overshadowed by rising prices and the growing number of people slipping into poverty. It must urgently formulate and implement a comprehensive plan to prevent poverty, raise incomes and reduce unemployment.