Bangladesh’s economy is facing renewed pressure from high inflation, rising poverty and sluggish credit growth in the private sector, Dhaka Chamber of Commerce and Industry (DCCI) President Taskin Ahmed has said.

He made the remarks while presenting the keynote paper at a seminar titled “Biannual Economic Situation of FY2026: Revenue and Monetary Policy Context and Private Sector Expectations” at the DCCI auditorium in Motijheel on Saturday.

Taskin said credit growth in the government sector is around 26 percent, while private-sector credit growth stands at only 5 percent, creating a major challenge for investment and business expansion.

He noted that inflation stood at 9.16 percent in June before falling to 8.32 percent in July. However, disruptions in supply chains and a doubling of transportation costs have increased the prices of imported goods, putting further pressure on domestic prices and weakening the competitiveness of Bangladeshi industries in global markets.

According to the DCCI president, the country’s poverty rate rose from 18.7 percent in 2022 to around 21.5 percent in 2025. He warned that the impact of the conflict in the Middle East could push another 1.2 million people below the poverty line.

He also said global economic growth is projected at 3.1 percent in 2026, while disruptions in global supply chains and higher import costs are likely to continue affecting Bangladesh.

Taskin said the proposed national budget for FY2026 has a total size of Tk 9.38 lakh crore, against a revenue collection target of Tk 6.95 lakh crore. At the same time, the government faces rising debt-servicing costs of Tk 1.275 lakh crore, putting additional pressure on its fiscal capacity.

He recommended reducing reliance on domestic bank borrowing and giving priority to lower-cost foreign loans and non-bank financing.

The DCCI also proposed raising Bangladesh’s tax-to-GDP ratio to 15 percent by 2035, citing the country’s low current ratio as a major challenge to achieving revenue targets.

Although the policy interest rate has been reduced from 10 percent to 9.5 percent, government credit growth remains around 26 percent while private-sector credit growth is only 5 percent, Taskin said.

He urged the government to limit borrowing from the banking system to ensure adequate credit for private businesses.

Taskin said high interest rates and the government’s dependence on bank borrowing are restricting financing for the private sector. The capital market also lacks sufficient alternative sources of long-term financing.

He called for expanding the markets for corporate bonds and sukuk to reduce dependence on bank financing and create more opportunities for long-term investment.

He also warned that Bangladesh’s logistics costs remain high at 15–20 percent of GDP, compared with around 8–10 percent in advanced economies. The high cost is undermining the country’s competitiveness in international markets.

The DCCI president welcomed several measures proposed in the FY2026 budget to improve the business environment.

These include registering new companies fully online within 48 hours, allowing businesses to repatriate profits of up to Tk 100 crore without prior Bangladesh Bank approval, and bringing 10 new sectors under duty-free bonded warehouse facilities.

He said 125 services across 28 categories have been standardised for online delivery, while bonded facilities for the leather, footwear, rice and home-textile sectors are proposed to be extended for up to three years.

Tax administration reforms, including an online corporate tax platform, automated tax refunds and risk-based digital audit selection, were also highlighted.

The government is also planning an “one citizen, one identity and one digital wallet” system, along with AI-based public services and expansion of 5G coverage to 90 percent of the country, he said.

Taskin said regulatory simplification could enable profit repatriation within one day, business approvals within seven days and faster work permits for employees of foreign companies. Professional licences for small businesses would also be available for periods ranging from six to 12 months.

Looking ahead to Bangladesh’s graduation from the LDC category, he said the country would lose some duty-free market access and concessional development assistance, creating new challenges for exporters and businesses.

He stressed the need to accelerate negotiations for free trade agreements (FTAs) and preferential trade agreements (PTAs) to prepare the private sector for the post-LDC environment.