Green budget challenge:  Are our cities ready for climate change?    

The national budget for fiscal year 2026–27 is an important step in Bangladesh's efforts to address climate change and environmental challenges. The government has allocated Tk2,240 crore to the Ministry of Environment, Forest and Climate Change, Tk100 crore to the Climate Change Trust Fund, and a total of Tk51,746 crore for climate-related activities across 25 ministries. 

This represents a nearly 26% increase from the previous year and reflects a strong commitment to building a greener economy.

While this increased funding is encouraging, an important question remains: how much of it will help create a climate-resilient built environment? 

This includes the homes, buildings, roads, and urban infrastructure that people depend on every day. As climate risks continue to grow, strengthening these systems is becoming increasingly important for Bangladesh.

The budget includes several ambitious environmental initiatives. 

The measures include planting 250 million trees over the next five years, bringing 50% of coastal forests under carbon trading schemes, creating around 350,000 green jobs, re-excavating 20,000 kilometres of canals, and reducing plastic waste by 30% through the Reduce, Reuse and Recycle (3R) strategy. Taken together, they represent a positive step towards greater environmental sustainability. 

However, the budget offers limited support for climate-resilient housing. Every year, river erosion, rising sea levels, and severe cyclones force many people to leave their homes and move to cities such as Dhaka and Chattogram. Despite this growing challenge, there is no clear strategy or dedicated funding to provide affordable and climate-resilient housing for these displaced populations.

A large share of environmental spending continues to focus on rural infrastructure and traditional adaptation projects.

Bangladesh's cities are expanding rapidly, yet the budget provides few incentives for sustainable construction. Although eco-friendly alternatives to traditional clay bricks exist, their use remains limited. The budget does not offer significant tax benefits for green building materials or incentives for developers to adopt environmentally friendly construction methods. As a result, much of the housing sector continues to rely on carbon-intensive building practices.

Focusing on urban areas 

While these investments are necessary, urban areas also require greater attention. 

Bangladesh's cities are expanding rapidly, yet the budget provides few incentives for sustainable construction. Although eco-friendly alternatives to traditional clay bricks exist, their use remains limited. The budget does not offer significant tax benefits for green building materials or incentives for developers to adopt environmentally friendly construction methods. As a result, much of the housing sector continues to rely on carbon-intensive building practices.

The lack of focus on sustainable urban development is also contributing to the growing urban heat island effect in cities like Dhaka and Chattogram. Unplanned construction, the loss of green spaces, and the filling of wetlands have made cities significantly hotter than surrounding rural areas. The budget includes positive measures such as reducing taxes on electric vehicles and improving air quality monitoring. However, it does not provide dedicated funding for urban greening, rooftop gardens, rainwater harvesting, or sustainable drainage systems—important tools for making cities more climate resilient.

Rethinking adaptation and innovation 

Another concern is that much of the adaptation budget remains tied to conventional infrastructure projects and administrative processes. 

Innovative housing solutions for vulnerable regions receive limited attention. Coastal communities need salt-resistant housing, while flood-prone areas such as the haor regions could benefit from floating or flood-adapted homes. 

More investment is also needed in research and technical innovation to develop these solutions. In addition, inflation may reduce the real value of the increased budget allocation, making effective implementation even more important.

Looking ahead, Bangladesh must develop stronger policies to help the construction and housing sectors move toward a low-carbon future. 

While some commercial buildings have adopted international green building standards, most residential buildings still lack features such as natural ventilation, rooftop solar panels, thermal insulation, and water-saving technologies. Promoting these features through financial incentives and updated building regulations could significantly reduce energy use and improve climate resilience.

The country also needs location-specific housing policies.

Climate risks vary across Bangladesh, and a single approach will not work everywhere. Coastal districts face salinity and cyclone risks, while floodplains and riverbank areas face different challenges. 

Housing policies and building guidelines should reflect these local realities. At the same time, local governments should be given greater resources to invest in green infrastructure, public water bodies, parks, and climate-resilient urban spaces.

A shared responsibility 

Ultimately, climate resilience cannot be achieved through government spending alone. 

Success will require cooperation among government agencies, private developers, researchers, universities, and local communities. The goal should be to create housing and infrastructure that are safe, energy-efficient, affordable, and environmentally sustainable.

The 2026–27 budget demonstrates the government's commitment to environmental protection, but funding alone is not enough. 

Without targeted support for green construction materials, affordable financing for sustainable housing, and stronger incentives for climate-smart urban development, much of the budget's potential may remain unrealised. To build a safer and more sustainable future, Bangladesh must place resilient housing and sustainable urban development at the heart of its climate strategy.

Dr Sajal Chowdhury is an architect, educator and head of the Department of Architecture, CUET and a researcher focusing on Environmental Experience Design, IEQ, Architectural Science and Wellbeing