Beyond numbers: Budget of 2026–27

We have a natural fascination with numbers. Whenever an issue is expressed in numerical terms, we tend to believe that it is definitive - that it represents the ultimate truth. Yet we often forget that numbers are merely quantitative representations, and behind their abstraction lie important analytical frameworks, concepts, and value judgments. This is especially true in discussions and analyses of national budgets. The debate surrounding this year's budget has been no exception.

In discussions and analyses of Bangladesh's 2026–27 budget, numerous figures, statistics, and data have been presented, and much debate has centred on the numerical aspects of the budget. Since a national budget is essentially a country's annual financial statement, it naturally contains numbers, data, and monetary allocations. These are undoubtedly important. 

However, in the final analysis, beyond all the figures, revenues, expenditures, surpluses, deficits, and allocations, the most fundamental question remains: How much relief will this budget bring to people's everyday lives? How much will it improve their quality of life? A budget should exist for the people. Bangladesh's budget, therefore, must move beyond the boundaries of numbers.

In this context, an important point is that every budget should possess a coherent philosophy of development beyond its numerical framework. Does a budget believe that material economic growth alone constitutes development, or does it embrace the view that the ultimate purpose of development is human development? The title of the 2026–27 budget is "Inclusive Development Towards Building a Humanitarian Society." 

This title suggests three defining characteristics of the budget. First, it aspires to build a humanistic, welfare-oriented state. Second, it places the improvement of people's quality of life at the centre of its development philosophy. Third, it envisions a development process in which everyone participates and whose benefits are shared equitably.

Secondly, based on this development philosophy, the budget has identified its objectives, strategies, and financial allocations. Two issues are particularly important in this regard. One, there must be a careful assessment of whether these objectives, strategies, and allocations are genuinely consistent with the stated philosophy of development. If they are not, then necessary course corrections should be considered from the outset. Two, it is equally important to evaluate whether the budget's targets are realistic. 

For example, the 2026–27 budget sets an economic growth target of 6.5% - roughly double the current growth rate. Given Bangladesh's present economic slowdown, how realistic is such a target? Similarly, the budget aims to reduce inflation to 7.5%. 

Are these targets achievable under current circumstances? There is a further concern. Such ambitious targets may further raise already high public expectations. If those expectations are not fulfilled, public confidence in the government may suffer, undermining the credibility of the country's relatively new administration.

Thirdly, the current budget has had to navigate a difficult balancing act. On one hand, it has had to remain fiscally frugal; on the other, it has had to be ambitious. Financial constraints have compelled the government to adopt a conservative fiscal stance, while the need to overcome economic stagnation has required incentives across various sectors. Consequently, the budget has had to balance providing immediate public relief with stimulating economic activity.

At the same time, the budget faces three major challenges: the longstanding and emerging problems of implementation, financing constraints, and the continuing global crisis. Preparing a budget is easier than implementing it. Because of various institutional obstacles, development projects often experience significant delays before they even begin. 

The deterioration of economic governance has also created new implementation challenges. The budget envisages a substantial level of expenditure. This naturally raises the question: where will the money come from? Bangladesh's revenue base and tax structure remain relatively weak. 

As a result, the government must rely heavily on both domestic and foreign borrowing. If the government borrows extensively from the banking sector, it could crowd out private-sector access to credit. More importantly, Bangladesh already carries a heavy burden of external debt and debt servicing. Under these circumstances, obtaining new international loans will become increasingly difficult. It should also be remembered that global interest rates have risen while repayment periods have shortened. 

Furthermore, growing geopolitical and geo-economic tensions, along with the rise of economic nationalism around the world, may create additional challenges for Bangladesh in the years ahead.

None of these challenges exists in isolation. Therefore, the current government's first budget should be viewed within the broader context of its already announced five-year development plan. Each annual budget over the next five years should represent one step toward achieving that medium-term strategy. 

At the end of the current fiscal year, the success of this budget should be assessed according to whether it has advanced the government's medium-term objectives as expected. Such an evaluation is important because Bangladesh will increasingly face a threefold set of challenges: ongoing problems, intensifying problems, and emerging problems.

Persistent challenges such as poverty, deprivation, economic stagnation, inflation, and unemployment will continue to weigh on the economy. Intensifying challenges will include rising inequality, violence against women, weaknesses in the financial sector, and environmental degradation. Emerging challenges will arise from the multidimensional nature of global crises, preparations for graduation from least-developed-country status, various geo-economic barriers, and the spread of economic nationalism. 

All of these factors could hinder the achievement of the budget's objectives. Against this backdrop, Bangladesh must prioritize a broad agenda of reforms in the years ahead - political, financial and economic, social, and cultural reforms. There is no alternative.

Secondly, Bangladesh must seize new opportunities. Diversifying the economy is essential. The country must harness the potential of the creative economy, the blue economy, and the green economy. The current budget has rightly given importance to the creative economy and allocated resources for its development. However, to capitalize on these opportunities, Bangladesh must strengthen its human capital. This requires greater investment in education and healthcare, meaningful reforms in both sectors, and significant improvements in the quality of services they provide.

Finally, if Bangladesh truly seeks to establish itself as a welfare-oriented state, political democracy alone will not suffice. Economic democracy must also be ensured. The democratization of the economy is therefore indispensable. Only by moving beyond the boundaries of numbers can Bangladesh's economy reach that destination.

Dr Selim Jahan is the Former Director of the Human Development Report Office and Poverty Division at the United Nations Development Programme, New York, US

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.