Approximately 40% of Bangladesh’s upcoming budget will be allocated to subsidies, interest payments, and salaries and allowances for government employees, limiting spending on social safety nets, health, and education. The finance ministry plans to allocate Tk 3,14,700 crore for these fixed expenses out of a total budget of Tk 7,96,900 crore for fiscal year 2024-2025. Specifically, Tk 1,16,000 crore will go towards interest payments, Tk 1,11,000 crore for subsidies and incentives, and Tk 87,700 crore for government employee salaries. Over the past five years, spending on wages, pensions, subsidies, and interest has increased faster than revenue earnings, reducing the government’s fiscal flexibility.
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