Bangladesh’s Aviation Industry Is Failing to Take Off

A country’s aviation strength is not measured simply by how many people pass through its airports.

It is measured by how much value the country can create from that movement: the jobs it sustains, the businesses it supports, the skills it develops and the revenue it retains.

By that measure, Bangladesh has a striking imbalance. Its citizens are travelling in growing numbers, its overseas workforce generates a steady demand for international connections, and its economy is becoming more closely tied to global markets. Yet the domestic aviation industry captures only a modest share of the opportunities created by this movement.

The central problem is not a lack of passengers. More than 12.6 million international passengers travelled by air from Bangladesh last year. More than 10 million Bangladeshis are employed in 176 countries, while tourism, education, trade and family travel add further demand.

This should provide a substantial foundation for a dynamic aviation industry. Instead, foreign airlines carry an estimated 75 to 80 percent of international passengers travelling to and from Bangladesh.

The country supplies a large customer base to the global airline business, but its own carriers remain marginal players in the market they serve.

This imbalance deserves attention as an economic question, not merely as a commercial concern for airline owners. When a foreign carrier transports a passenger from Dhaka to a destination abroad, the transaction supports an airline, its workforce, maintenance arrangements, distribution network and wider business ecosystem.

A Bangladeshi carrier operating the same journey could retain more of that activity within the national economy. The difference is not that every taka spent on a foreign airline would otherwise remain in Bangladesh. International aviation necessarily involves overseas costs and partnerships.

The point is that a stronger domestic industry would allow Bangladesh to capture a larger share of the value generated by its own demand.

The country’s modest contribution to GDP makes the missed opportunity visible. The International Air Transport Association estimates that aviation directly contributed around $2.9 billion to Bangladesh’s economy, equivalent to 0.58 percent of GDP.

Including wider effects, the contribution was about $5.3 billion, or 1.2 percent, in 2023. The comparable total contribution was reported at 4.4 percent of GDP in Sri Lanka, 4.6 percent in the Philippines, 4.1 percent in Vietnam, 6.8 percent in Thailand and 9.9 percent in Hong Kong.

These figures do not prove that every country can or should reproduce another’s aviation model. They do, however, indicate how differently countries convert air connectivity into economic activity.

Bangladesh’s weakness is also reflected in the reach of its international network. Flights connect the country to 28 international destinations, while the reported figures are 45 for Sri Lanka, 72 for Vietnam, 74 for the Philippines, 171 for Hong Kong and 220 for Thailand.

Destination counts alone are not a complete measure of connectivity: frequency, passenger volume, transfer options and the commercial viability of routes matter as much.

The more revealing statistic may be the decline in the market share of Bangladeshi airlines. Domestic carriers accounted for about 59 percent of international passenger transport in 1990.

Their share is now around 25 percent, even though the overall market has expanded substantially.

This is not simply a story of foreign airlines becoming more successful. It is also a story of local capacity failing to grow at the same speed as demand. The country has enlarged the market without building domestic carriers capable of securing a proportionate share of it.

There are understandable reasons for this weakness. Airlines require heavy and sustained investment. Aircraft acquisition, leasing, fuel, insurance, maintenance and training all impose substantial costs.

A new international route may take time to become commercially viable, while established foreign carriers can draw on extensive networks, larger fleets and stronger financial resources.

Domestic airlines also face the challenge of recruiting and retaining pilots, engineers and other specialised professionals. Expanding a fleet, therefore, is not a simple matter of placing an order for more aircraft. It requires a complete operating system capable of supporting those aircraft safely and profitably.

For too long, aviation policy has also been discussed largely through the fortunes of Biman Bangladesh Airlines. Biman’s performance matters, particularly because it is the national flag carrier. But the health of an entire industry cannot be judged by the financial condition of one airline.

Nor can its development be secured by treating private carriers merely as supplementary operators. A national aviation strategy should consider the whole ecosystem: public and private airlines, airports, ground handling, aircraft maintenance, cargo, pilot and engineering training, tourism, hospitality and logistics. Without such a perspective, policy will continue to address individual symptoms while leaving structural weaknesses intact.

The distinction is important because aviation creates value well beyond the price of an air ticket. A functioning maintenance and repair sector can retain technical expenditure and develop specialised skills. Training institutions can prepare pilots, engineers, cabin crew and air traffic professionals for local and international employment.

Better air links can support tourism, business travel, export logistics and investment. Airports can become platforms for commercial activity rather than facilities concerned only with passenger processing. These benefits do not emerge automatically from buying aircraft. They require coordinated planning and sustained investment across connected sectors.

Bangladesh’s expatriate workforce offers a particularly important starting point. The regular movement of migrant workers creates a large and recurring market, especially on routes linked to countries where Bangladeshis are employed.

Yet the needs of migrant passengers should not be treated simply as an opportunity to sell tickets. Their travel patterns can inform route planning, seasonal scheduling, partnerships and service design.

A more deliberate connection between migration policy and aviation planning could help domestic airlines identify viable markets while improving travel options for workers and their families.

The same principle applies to tourism and education. Better connectivity can make Bangladesh more accessible to visitors and help local businesses reach international customers.

Conversely, limited routes and inconvenient connections can make travel more expensive or time-consuming, weakening the country’s appeal.

Aviation policy should therefore be developed alongside tourism promotion, investment strategy and trade facilitation. A country cannot realistically aspire to become a regional hub if its transport links, visitor services and commercial environment are planned in separate compartments.

The ambition to expand routes, acquire aircraft, introduce direct Dhaka-New York services and develop Dhaka as an aviation hub signals recognition of the sector’s potential. But a hub is not created by a slogan or a new terminal.

It depends on reliable operations, strong safety oversight, efficient transit arrangements, competitive costs, skilled personnel and a network that gives passengers a reason to connect through the country. International confidence is built through consistency, not announcements.

There is a substantial opportunity ahead. IATA projections suggest that, if current growth continues, Bangladesh’s aviation market could expand by 168 percent over the next two decades.

Annual passenger departures may reach 30 million by 2038, with an additional GDP contribution estimated at $2.1 billion to $3.2 billion and the potential to support 140,000 to 222,000 jobs.

These are projections, not promises. Their realisation depends on investment, institutional competence and the ability to turn demand into productive capacity. Passenger growth by itself will not guarantee that the benefits accrue to Bangladesh.

The policy test, then, is not whether Bangladesh can put more aircraft into the air. It is whether it can build the conditions in which a competitive aviation industry can grow. That means predictable regulation, fair and competitive charges, access to finance, skilled human resources, modern training facilities, stronger airports and a level playing field for responsible public and private operators.

(The writer is an Academic, Journalist, and Political Analyst based in Dhaka, Bangladesh. Currently he is teaching at IUBAT. He can be reached at nazmulalam.rijohn@gmail.com)