The government of Bangladesh has approved a Tk2.3 trillion ($29.2 billion) Annual Development Program (ADP) for the fiscal year 2025-26, setting out a comprehensive roadmap for public investment focused on infrastructure, human capital, and sustainability amid ongoing political and economic uncertainty.
The new ADP, effective from July 2025 to June 2026, represents a scaled-back allocation compared to the Tk2.7 trillion ($34.2 billion) sanctioned under the original plan for FY24-25.
Of the total, Tk1.4 trillion ($17.74 billion) will come from domestic resources and Tk860 billion ($10.9 billion) from foreign aid, a financing mix designed to maintain fiscal stability and avoid overreliance on debt, in line with the interim government’s broader economic strategy.
Unlike previous mega project-heavy budgets, the FY25-26 ADP is more streamlined and results-oriented, covering 1,171 projects.
These include 993 investment projects, 99 technical assistance programs, 19 feasibility studies, and 60 self-financed initiatives.
Officials say each project was selected based on alignment with national priorities and the UN Sustainable Development Goals (SDGs).
The plan reflects a shift toward “quality over quantity”, following a year of low implementation in FY24-25.
According to the Implementation Monitoring and Evaluation Division (IMED), only Tk909 billion ($11.52 billion) — or 67.3 per cent of that year’s original allocation — was spent, compared with Tk1.2 trillion (15.2 billion) (76.4 per cent) in FY23-24.
The sharp drop was blamed on political upheaval, which disrupted continuity in public projects and led to delays, cancellations, or withdrawals by contractors and project directors.
Nearly 70 per cent of the FY25-26 allocation will flow into five key areas:
- Transport and communications: Tk589.7bn
- Power and energy: Tk323.9bn
- Education: Tk285.6bn
- Housing and community facilities: Tk227.8bn
- Health services: Tk181.5bn
The focus is on building critical infrastructure, while also strengthening human capital and essential services rather than embarking on politically risky mega-projects.
Exceptionally, the Japan-funded Matarbari Deep Sea Port and the Rooppur Nuclear Power Plant remain on the government’s priority list.
The nuclear project alone accounts for over Tk1 trillion (12.67 billion) in ongoing investments, including safety infrastructure, power transmission, and supporting research facilities.
Among ministries and divisions, the Local Government Division received the largest share (Tk361bn), followed by the Road Transport and Highways Division (Tk323.3bn/$4.1 billion), Power Division (Tk202.8bn/$2.57 billion), and the Secondary and Higher Education Division (Tk136.3bn/$1.73 billion).
Other notable allocations include Tk121.5bn for the Science and Technology Ministry, Tk116.2bn for the Health Services Division, Tk114bn for Primary and Mass Education, and Tk93.8bn for the Shipping Ministry.
A key innovation in the FY25-26 ADP is the integration of climate-focused financing and public-private partnership (PPP) projects into the core plan.
About 228 projects are tagged under the Bangladesh Climate Change Trust Fund, underscoring a growing emphasis on resilience and sustainability.
Additionally, 79 projects have been placed under the PPP model, tapping private sector expertise and funds to reduce strain on public resources.
The government has earmarked special allocations in education and health to broaden access and modernise facilities. In the education sector, initiatives such as the School Feeding Program and the Fourth Primary Education Development Program aim to reduce dropout rates and improve child nutrition.
Higher education projects will focus on ICT-based learning, university modernisation, and digital classroom development.
In health, the ADP supports the construction of new medical colleges and hospitals, expansion of specialised health units such as burn and cancer treatment facilities, and improvements in waste management, diagnostics, and dialysis centres.
Analysts note that by cutting back on politically sensitive mega-projects and refocusing on essential infrastructure and climate resilience, the FY25-26 ADP reflects the interim government’s pragmatic attempt to safeguard stability during a period of economic and political uncertainty.
With sharper scrutiny of project feasibility and transparency measures in place, the government hopes the revised ADP will encourage more efficient spending, reduce regional disparities, and foster inclusive development.
Bangladesh’s Tk2.3 trillion ($29.2 billion) ADP for FY25-26 is more fiscally cautious, targeted, and sustainability-oriented than previous plans.
It emphasises transport, power, education, health, and housing, while integrating climate finance and PPPs — signalling a strategic shift in the country’s development priorities under transitional governance.