Dhaka: Finance Minister Amir Khosru Mahmud Chowdhury informed Parliament on Tuesday that Bangladesh is anticipating an additional subsidy requirement of approximately Tk 42,600 crore across four key sectors-oil, gas, electricity, and fertiliser-in the fiscal year 2025-2026. This financial strain is attributed to the ongoing conflicts in the Middle East.
According to United News of Bangladesh, the recent turmoil in the Middle East, including tensions involving Iran, has exacerbated instability in the global energy market. This has consequently placed additional pressure on the Bangladeshi government’s subsidy expenditures in the aforementioned sectors. Preliminary estimates indicate that by June of the 2025-26 fiscal year, the government will need to allocate an extra Tk 42,600 crore to these sectors.
In response to a question posed by ruling party lawmaker SM Jahangir Hossain (Dhaka-18) regarding economic or business losses incurred due to the Middle East conflicts, the finance minister detailed the subsidy allocations: approximately Tk 10,258 crore for oil, Tk 11,170 crore for gas, Tk 19,821 crore for electricity, and Tk 1,350 crore for fertiliser.
Minister Khosru highlighted that the Middle East conflict presents immediate and potential risks to Bangladesh’s economy. The impact is predominantly observed in areas like fuel, fertiliser, import costs, transport expenses, inflation, foreign exchange management, remittances, and foreign employment. Rising international prices of fuel oil, LNG, and fertilisers have increased import and production costs, potentially affecting market prices and contributing to inflation in various sectors such as electricity, transport, agriculture, and industry.
Additionally, as the Middle East is a critical region for Bangladeshi expatriate workers, prolonged instability could jeopardize foreign employment opportunities and remittance inflows. In light of these challenges, the government is actively monitoring the situation and implementing measures to mitigate the impact. These measures include diversifying energy import sources, exploring local gas reserves, ensuring a stable supply of essential goods, exercising caution over foreign exchange management, and seeking alternative labor markets.