B Mirror Report:  The World Bank has called for a major restructuring of public spending in Bangladesh’s agriculture sector, warning that farm productivity and diversification have weakened despite increased budget allocations.

In a report titled “Repurposing Agricultural Public Spending for Quality Growth and Jobs in Bangladesh’s Agrifood System” released on Monday, the World Bank said Bangladesh allocates nearly 10 percent of total government expenditure to agriculture, yet agricultural growth has slowed in recent years.

The report noted that a large share of public spending is concentrated on fertilizer subsidies and rice production, while critical areas such as agricultural research, extension services, irrigation, market access and climate resilience remain underfunded.

According to the report, fertilizer subsidies account for nearly 80 percent of the Agriculture Ministry’s budget. However, the benefits are unevenly distributed, with the top 20 percent of landowners receiving nearly half of all fertilizer subsidies, while the poorest 40 percent of farmers receive only about 15 percent.

The World Bank also found significant imbalances in fertilizer use, with only 5 percent of farmers applying fertilizers in balanced amounts, suggesting substantial potential for improving crop yields and productivity.

World Bank Division Director for Bangladesh and Bhutan Jean Pesme said agriculture remains vital for Bangladesh’s development, job creation and poverty reduction, but climate risks, changing food demand and global supply disruptions have exposed weaknesses in current policies and spending patterns.

The report also highlighted that around 72 percent of Bangladesh’s cultivable land is devoted to rice, which receives nearly 80 percent of total subsidies, hindering diversification into higher-value sectors such as livestock, fisheries, vegetables and agro-processing.

The World Bank recommended expanding soil testing, strengthening agricultural advisory services and introducing farmer cards and e-vouchers to ensure support reaches poor and climate-vulnerable farmers, while gradually shifting spending toward higher-return investments and more productive agricultural activities.