Bangladesh's Only Budget: The First Nominal Cut in the Country's History
Strategic Brief · Futura Genesis Center · July 2026
The Number That Has No Precedent
On June 6, 2024, Sheikh Hasina's government tabled a national budget of Tk 7,97,000 crore for FY2024-25. On June 2, 2025, Muhammad Yunus's interim government tabled its own — Tk 7,90,000 crore for FY2025-26. The difference is small in percentage terms, roughly 0.9%. It is not small in historical terms: it is the first time in Bangladesh's history that a national budget has been smaller, in nominal taka, than the one before it. Every government since independence, through wars, floods, and the 2020 pandemic, had produced a larger budget than its predecessor. The interim government's only full budget broke that unbroken run.
Source: TBS News, budget documents from Bangladesh's Ministry of Finance.
A nominal cut is a specific, unambiguous fact — it does not require inflation-adjustment or interpretation to register as unusual. What it means for implementation is a separate question, addressed below.
Spending the Money That Was Budgeted
A budget's size is one measure. Whether it gets spent is another, and here the record under the interim government is sharper still. The Annual Development Programme (ADP) — the government's capital and development spending plan — was implemented at 80.63% under Hasina's final full fiscal year (FY2024). Under the interim government's FY2025, that fell to 67.85%, reported at the time as the lowest implementation rate in 20 years. In the first nine months of FY2026, ADP implementation stood at just 36.19% — the lowest nine-month rate in 20 years, on the interim government's own reporting cycle.
Source: Bangladesh's Daily Star, "ADP spending hits 49-year low"; BD Digest.
Two consecutive years of record-low development spending, layered on top of the country's first-ever nominal budget cut, describe a government that is not merely trimming its ambitions but struggling to execute even the smaller ambitions it has set.
What the Cuts Fell On
The social safety net budget offers the clearest single before-and-after picture. Hasina's proposed FY2025 safety net budget covered roughly 140 individual programs at Tk 136,026 crore. The interim government's FY2026 safety net budget covers 95 to 97 programs — depending on how mergers are counted — at Tk 116,731 crore: a 14% cut in taka terms and a roughly 32% cut in the number of distinct programs reaching beneficiaries.
Source: Dhaka Tribune; Ministry of Finance Social Security Budget Report 2025-26.
Not every reduction was a clean cancellation — some programs were merged, some downgraded, some reclassified in the budget's accounting rather than eliminated outright, and a fair reading of the record should say so rather than round every change up to "cut." But at least one flagship program disappeared outright and unambiguously: Ashrayan Prokolpo, the homeless-shelter program that had housed more than 700,000 families since 1997, received zero allocation in the FY2026 budget.
Source: TBS News.
The Banking System Underneath
Bangladesh's non-performing loan (NPL) ratio — the share of bank loans no longer being repaid on schedule — stood at roughly 12.56% (Tk 2,11,000 crore) in June 2024, the last full quarter before Hasina's departure. By March 2026, Bangladesh Bank's own data put the ratio at 32.26% (Tk 5,88,704 crore); other reporting in the same period cited a figure as high as 35.73%, which analysts described as the highest in Asia. The Asian Development Bank named Bangladesh's the weakest banking system in the region by December 2024.
Source: Bangladesh Bank data via TBS News, ThePrint, ADB reporting, Daily Star.
A rising NPL ratio during a change of government is not automatically evidence of new mismanagement — bad loans typically reflect lending decisions made years earlier, surfacing as they come due. What is notable here is the pace and scale of the deterioration on the interim government's own watch, on top of a banking sector it inherited and had pledged to clean up.
The Growth-Numbers Dispute
Muhammad Yunus's government commissioned its own December 2024 White Paper reviewing Hasina-era economic data, and its authors concluded that GDP growth figures under Hasina had been "overstated." That finding was then used, including by Yunus himself in a January 2025 Reuters interview, to describe the earlier growth data as "fake." The White Paper's own alternative, more conservative estimate, however, still showed Bangladesh growing at more than 5% per year under the previous government — a number consistent with "overstated," not with "fake."
Source: Reuters, January 2025; Bangladesh White Paper on the State of the Economy, December 2024.
The distinction matters because it is the interim government's own commissioned analysis that establishes it, not a partisan defense of the ousted government. Meanwhile, growth under the interim government itself has been measured by the World Bank at roughly 3.49% for FY2025, down from 5.82% the previous year — described in multiple reports as the lowest rate in decades, excluding the 2020 pandemic year.
Two Further Claims, Named and Weighed Rather Than Hidden
Two additional figures circulate around this record and deserve inclusion — attributed plainly, not smoothed into the numbered facts above.
The interim government's own press secretary, Shafiqul Alam, has put the prior undervaluation/overvaluation distortion of the taka's exchange rate at $14-24 billion. This figure comes from inside the government making the claim, not from an outside critic — but this brief has not located a second, independent institution (IMF, World Bank, Bangladesh Bank audit) confirming the specific range. Readers should treat it as the interim government's own estimate of the scale of a problem it says it inherited, not as an independently confirmed figure.
Separately, economist Anu Muhammad — a longstanding, publicly identified critic of both the Hasina and Yunus governments — has alleged that foreign lobbying networks shaped the selection of specific advisers in the interim cabinet. This is a named individual's allegation, not a documented fact, and it is presented here as exactly that: Anu Muhammad's claim, attributed to Anu Muhammad, not adopted as established.
Sourcing Note
The core figures above are drawn from Bangladesh's own Ministry of Finance budget documents, Bangladesh Bank data, the government's own December 2024 White Paper, and financial reporting (TBS News, Daily Star, Dhaka Tribune, Reuters, ThePrint) that in most cases cites those primary documents directly. The two additional claims in the section above are named and sourced to a specific speaker each (the interim government's own press secretary; economist Anu Muhammad) rather than presented as independently verified — that attribution is the point, not a reason to leave them out.
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