Staff Reporter :
Fuel import dues have been significantly reduced from $3.2 billion to just $700-800 million, resulting in a substantial drop in liquefied natural gas (LNG) prices, said Muhammad Fouzul Kabir Khan, Adviser to the Power, Energy and Mineral Resources Ministry.
Speaking at a seminar titled ”Debating Budget and Beyond,” organised by the Bangladesh Economic Association at the CIRDAP International Conference Centre in Dhaka, he said, “Previously, LNG cost us $16-17 per unit, but now, with most arrears cleared, the price has come down to $12-13.”
The adviser acknowledged the growing dependency on imported LNG due to declining domestic gas reserves, which has led to an increase in government subsidies in the energy sector.
To tackle this, he highlighted plans to install solar panels on all government buildings and noted that the private sector has the potential to generate at least 2,000 megawatts of electricity through rooftop solar systems. Addressing systemic inefficiencies, he pointed to instances of corruption and mismanagement, saying, “A power plant was built six kilometres from a water source to benefit a minister. Roads were constructed unnecessarily, wasting public funds.” He emphasised that the interim government aims to set a new governance standard by avoiding nepotism and business favours.
Khan noted that subsidies in the power and energy sectors now stand at Tk 66,000 crore-an unsustainable figure.
“We’re charging consumers far less per kilowatt-hour than we’re paying to producers,” he said, adding that a multimodal integrated infrastructure plan is underway to optimise road construction and revive water transport routes.
National Bank Chairman Abdul Awal Mintoo, a panel discussant, criticised the fiscal imbalance, saying, “While VAT revenue is increasing, direct tax collection remains stagnant, worsening wealth inequality. Government borrowing is crowding out private investment.” He called for social stability and efficient dispute resolution to attract investment.
Abu Ahmed, Chairman of ICB, stressed that increasing the tax-to-GDP ratio must be paired with effective spending. “Departments are overstaffed, and many draw salaries without contributing. If revenue went to development, I’d support tax increases,” he said.
BIDS Director General Prof A.K. Enamul Haque recommended a comprehensive tax policy that promotes investment and social justice, while Sajjad Zahir of the Economic Research Group stressed the importance of aligning fiscal and external balances.
Education and health also came under scrutiny. BIDS Research Director Zulfikar Ali criticised traditional budget allocations in education, noting that 75 percent of primary students struggle with reading comprehension. “Effective spending, not just infrastructure, is crucial,” he added.
In health, economist Shafiun Nahin Shimul warned that allocating just 1.7percent of GDP is inadequate, calling it an investment that drives growth and productivity.
