Dr. Nurul Huda
Agri TECH Malaysia
At first glance, the proposed FY2026-27 agriculture budget of Tk 28,881 crore looks like good news. It represents a Tk 1,657 crore increase over last year’s allocation, and this framing has largely gone unchallenged. At a recent roundtable hosted by LightCastle Partners and SAF Bangladesh, experts broadly welcomed the rise, reading it as evidence of the government’s deepening commitment to the sector. But a closer examination of the figures complicates that narrative.
Let us consider the broader trajectory. Agriculture’s contribution to GDP has collapsed from nearly 38 percent in the 1970s to just 11.2 percent today. Against that backdrop, a roughly 6 percent nominal increase in the budget looks far less impressive, especially once you notice that subsidy allocations have fallen by 1.4 percent. Taken together, these numbers suggest something other than growing investment. Rather than reflecting a genuine push to strengthen or transform agriculture, the budget looks more like an exercise in damage control, i.e. enough spending to keep the sector from collapsing outright, but not nearly enough to reposition it for meaningful growth. In other words, this isn’t a story of commitment. It’s a story of suppression.
The Development Budget Illusion
The most celebrated figure in the roundtable discussion was the doubling of the development budget allocation to Tk 7,945 crore. This figure demands scrutiny. Annual Development Programme implementation rates stood at 93 percent in FY2022-23 and 95 percent in FY2023-24, before collapsing to 60 percent in FY2024-25 and 62 percent in FY2025-26. Doubling an allocation that your own bureaucracy cannot spend is not an investment in agriculture; it is an exercise in fiscal theatre.
The experts who welcomed this increase without foregrounding the implementation crisis are diagnosing the wrong disease. The problem is not that the development budget is too small; it is that the state’s capacity to translate allocations into outcomes has deteriorated sharply, and no amount of budgetary expansion will fix what is fundamentally an institutional failure.
The decline in ADP implementation from 95 to 60 percent over two fiscal years is not a marginal dip; it represents a structural breakdown in project execution, procurement, and disbursement capacity. Yet the roundtable discussion, as reported, framed this as a secondary concern rather than the central obstacle it plainly is. An expert community that celebrates an allocation while sidelining the collapse in its own spending capacity is performing analysis, not providing it.
The Subsidy Question No One Asked
Perhaps the most telling gap in the roundtable discussion was what went unsaid about the subsidy allocation itself. The proposed Tk 17,001 crore in subsidies (a 1.4 percent decline from the previous year) was noted in passing, but never seriously interrogated. That silence is worth pausing on.
The reason lies in how Bangladesh’s agricultural subsidies are structured. Rather than reaching farmers directly, the bulk of this funding flows to fertiliser manufacturers and importers, channeled through price support mechanisms. The report’s mention of a shift toward “input tax reductions” only reinforces this pattern, further skewing the allocation toward industry rather than the fields where crops are grown.
To their credit, the experts did acknowledge that these benefits have failed to “adequately reach smallholder and marginal farmers.” But the analysis stopped short of asking why. The answer lies not in poor implementation or leakage, but in the design of the subsidy system itself: it exists to reduce costs for the industries that supply agricultural inputs, not to increase the income of the farmers who ultimately purchase them. The exclusion of smallholders isn’t a side effect; it’s built into the architecture.
Contesting this requires acknowledging that a 1.4 percent nominal decline in subsidies, at a time when fertiliser prices on international markets have been volatile and input costs for farmers have risen sharply, is effectively a much larger real terms cut. The experts listed “rising input costs” as a farmer challenge while remaining largely silent on the budget’s decision to reduce the very subsidy buffer that cushions those costs. This is not a minor inconsistency; it is a failure to connect their own diagnosis to the budget they were convened to discuss.
The Structural Blind Spot
The roundtable’s framing that “policy priorities” and “strategic interventions” can translate allocations into “tangible benefits” assumes that the existing institutional architecture is capable of that translation. The ADP implementation figures alone refute this assumption. But the deeper problem is that the expert discourse consistently treats agriculture as a sector that needs more input, more subsidy, and more programme support, rather than as a sector whose structural relationship to the macroeconomy has fundamentally changed.
With agriculture contributing just 11.2 percent of GDP while employing roughly 40 percent of the workforce, the central issue is not how much is budgeted but whether the budget addresses the productivity-income gap that defines the sector. No amount of fertiliser subsidies closes the gap between what a farm worker produces and what they earn.
The Farmer Card programme, the emphasis on water management and post-harvest infrastructure, are worth noting, but they address symptoms, not causes. Until the expert community is willing to say that budgetary increases without implementation capacity are meaningless, that subsidy designs favour industry over farmers, and that the structural transformation of agriculture requires a different kind of allocation altogether … one directed at incomes rather than inputs, the annual discussion of budget numbers will remain what it currently is: a ritual affirmation of an upward trend that, on examination, does not exist.
