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Finance Minister Amir Khosru Mahmud Chowdhury has said that the government's primary strategy for controlling inflation is to reduce the cost of doing business, arguing that sustainable price stability cannot be achieved through administrative enforcement alone.
Speaking at a post-budget press conference at the Osmani Memorial Auditorium on Friday, a day after unveiling the record Tk9.38 lakh crore national budget for FY2026-27, the minister said inflation control requires effective policies, structural reforms and improved governance rather than periodic market crackdowns.
"Inflation cannot be controlled simply by sending police or government officials into the market," he said. "Markets remain stable through sound policies and good governance. If we can properly implement the reforms we have undertaken, bringing inflation under control will not be very difficult."
Bangladesh has been grappling with persistent inflationary pressures for several years, with rising global commodity prices, supply chain disruptions and domestic economic challenges continuing to push up the cost of living.
The finance minister noted that recent tensions and conflicts in the Middle East have added fresh pressure on international markets, increasing the prices of imported goods and fuels on which Bangladesh remains heavily dependent.
He also pointed to weaknesses in the financial sector, saying that capital shortages in banks, exacerbated by past loan irregularities and illicit financial outflows, have increased the cost of funds across the economy and contributed to inflationary pressures.
According to Khosru, while the government has limited influence over externally driven inflation, it can act decisively to reduce domestic business costs that eventually feed into consumer prices.
He identified a range of factors that continue to raise operating costs for businesses, including lengthy approval procedures, bureaucratic delays, high borrowing costs, inefficiencies at ports and excessive transportation expenses.
"Entrepreneurs often spend considerable time and money navigating multiple government offices before they can start a business," he said. "These inefficiencies ultimately increase costs throughout the supply chain and are eventually passed on to consumers."
The minister acknowledged that Bangladesh continues to rank relatively low in international assessments of business competitiveness and ease of doing business, reflecting the higher costs faced by investors and entrepreneurs.
He said the FY27 budget includes a series of reform measures aimed at streamlining business procedures, reducing administrative burdens and improving investment conditions.
Among the government's priorities are simplifying regulatory approvals, improving port efficiency, expanding digital services and creating a more investor-friendly business environment.
The finance minister argued that reducing these structural costs would help ease inflationary pressures while simultaneously encouraging private investment and job creation.
Addressing concerns over the budget deficit and government borrowing, Chowdhury said the administration intends to gradually reduce its reliance on bank borrowing in order to free up more credit for the private sector.
He noted that government borrowing from the banking system has been lowered compared with the previous fiscal year, while efforts are underway to expand alternative financing sources, including Sukuk bonds and other capital market instruments.The minister also linked inflation control to broader economic reforms outlined in the FY27 budget, which seeks to stimulate investment, strengthen employment generation and improve productivity across key sectors.
Responding to questions about income inequality and the challenges facing low-income workers, he said the government is investing heavily in skills development, vocational education and social protection programmes to improve living standards and create better employment opportunities.
He highlighted increased allocations for social safety net programmes, including family cards, farmer cards, preventive healthcare and workforce development initiatives.
"The objective is not only to support vulnerable groups today but also to equip them with the skills needed to secure better jobs and higher incomes in the future," he said.
Chowdhury acknowledged that Bangladesh's economic recovery would take time, describing the current budget as the beginning of a longer reform process aimed at restoring stability and laying the foundations for sustained growth.
"We have set the direction," he said. "It may take two years to stabilise the economy fully, but we believe the reforms and investments outlined in this budget will put Bangladesh on a stronger path towards prosperity."
The government has projected inflation at 7.5% and GDP growth at 6.5% in FY27, with policymakers hoping that a combination of structural reforms, investment promotion and improved governance will help ease price pressures while supporting economic expansion.
https://thedailyexpress.news/news/business/1f16653e-2a5a-6020-9220-d47af88f916e