Extortion targeting businesses surged by as much as 50 percent following the political upheaval that ended the Awami League government in 2024, while corruption in public offices persisted during the subsequent 18-month interim administration, the Dhaka Chamber of Commerce and Industry (DCCI) said on Monday.
Speaking at a press conference titled “Expectations from the New Government to Address the Current Economic Situation” at the chamber’s auditorium in Motijheel, DCCI President Taskeen Ahmed warned that deteriorating law and order and entrenched corruption were placing severe pressure on businesses.
“If extortion is not stopped, we will have to shut down our businesses,” Ahmed told reporters at the event.
He said companies were being forced to pay the same level of extortion as before the fall of the previous government — and in many cases up to 50 percent more. According to Ahmed, those demanding money often claim affiliation with whichever party is in power.
“They come and say they are from the government party. Whoever is in office, they say they are from that party, and we have to pay,” he said. “They demand money for events, for neighbourhood events.”
When asked who was responsible, Ahmed pointed to individuals linked to the ruling party, as well as elements within the police and revenue authorities.
He described extortion and corruption as “embedded in our blood,” adding bluntly: “If extortion does not stop, we will have to close our businesses and leave.”
Corruption ‘Did Not Decline for a Single Day’
The chamber president said corruption within public offices had shown no meaningful decline during the interim government’s tenure.
“Not for a single day has corruption in public offices declined,” he said at the Motijheel briefing.
His remarks reflect broader frustration within the private sector, which has repeatedly cited administrative bottlenecks, unofficial payments, and regulatory uncertainty as barriers to investment.
Bangladesh’s business community had initially expressed cautious optimism after the political transition in 2024, hoping that reforms would strengthen governance and stabilize markets. However, chamber officials now say expectations of improved transparency and law enforcement have largely gone unmet.
Private Sector Under Severe Pressure
Ahmed outlined four immediate priorities for the new BNP-led government: restoring law and order, eliminating corruption, supporting viable non-wilful loan defaulters, and reducing bank lending rates.
He said the government’s goal of creating 10 million new jobs would be unattainable without energizing the private sector.
The numbers he presented paint a troubling picture.
Private sector credit growth fell to 6.49 percent in fiscal year 2024-25 — the lowest level in 22 years. By December 2025, growth had slipped further to 6.10 percent. Private investment declined to 22.48 percent of GDP, while export growth slowed to roughly 0.5 percent in the same month.
“These challenges are caused by structural weaknesses,” Ahmed said, citing banking sector stress, rising import costs, energy shortages, and instability in law and order.
Banking Strain and Rising Borrowing Costs
Bangladesh’s financial sector remains under pressure from mounting non-performing loans (NPLs), which Ahmed said have climbed to nearly Tk 6.5 lakh crore.
He cautioned against treating all classified loans as deliberate defaults.
“A large number of SMEs became classified due to working capital shortages caused by Covid-19, global conflicts, around 41 percent currency depreciation over two years, and high interest rates,” he said.
Ahmed urged authorities to distinguish between wilful defaulters and firms affected by external shocks, recommending targeted support for viable enterprises.
Turning to monetary policy, he argued that maintaining the policy rate at 10 percent had failed to control inflation while pushing lending rates above 16 percent.
“As a result, bank borrowing has become costly and unviable for businesses,” he said, calling for either a reduction in the policy rate or subsidized credit lines for productive sectors.
Energy Crisis and Rising Industrial Costs
The chamber president also highlighted a daily gas shortfall of around 30 percent, which he said is disrupting industrial production.
Gas prices for new industries have been set at Tk 40 per unit and Tk 42 for captive power plants, adding to manufacturing costs. Although installed electricity generation capacity stands at 27,000 megawatts, actual output remains significantly lower, leading to substantial capacity payments.
Ahmed called for a modern and integrated energy policy, noting that the last comprehensive update dates back to 1996. He also recommended differential electricity pricing to encourage off-peak usage.
Trade and Revenue Concerns
On tax policy, Ahmed welcomed the government’s plan to raise the tax-to-GDP ratio to 8 percent but stressed that full automation of the National Board of Revenue (NBR) is essential.
“The tax administration system is still partly manual, which leads to inefficiency and corruption. Automation is now necessary,” he said.
He also proposed reducing the turnover tax from 1 percent to 0.6 percent, arguing that businesses are still recovering from prolonged economic shocks.
Ahmed criticized a 41 percent average tariff increase by the Chittagong Port Authority despite its surplus in fiscal year 2024. With approximately 88 percent of Bangladesh’s trade flowing through Chattogram Port, he warned that the hike would significantly raise costs and should be reviewed immediately.
He further urged full implementation of the Bangladesh Single Window system to streamline trade procedures and reduce transaction times.
LDC Graduation and Trade Strategy
The DCCI president welcomed the decision to defer Bangladesh’s graduation from least developed country (LDC) status by three years, saying it would provide breathing space for better preparation.
He also advised careful reassessment of a recent trade agreement with the United States.
“If necessary, the agreement should be renegotiated to ensure a win-win outcome,” he said.
A Test for Economic Leadership
Business leaders say the coming months will be critical. While political transition has reshaped the national landscape, the private sector is demanding stability, predictability, and stronger enforcement of law.
For many entrepreneurs, the immediate concern is survival.
“If extortion does not stop,” Ahmed warned, “we will have to shut down our businesses.”
The message from Motijheel was clear: without restoring order, reforming institutions, and lowering financial pressures, economic recovery may remain elusive — and job creation goals increasingly difficult to achieve.
