The war involving Iran, Israel, and the United States is unfolding thousands of miles away from Bangladesh. Yet its economic shockwaves are increasingly being felt in the country’s kitchens, electricity bills, farmlands, and marketplaces.
As global energy and food prices rise amid growing geopolitical uncertainty, the Bangladesh government is facing mounting pressure to shield consumers from the full impact of higher costs.
For the 2026–27 fiscal year, various government ministries have requested nearly Tk 120,000 crore in subsidies. While this figure may appear to be just another economic statistic, it reflects the enormous financial burden required to keep electricity, gas, fertilizer, and food prices within reach for ordinary citizens.
The power sector remains the government’s biggest concern. The Power Division alone has sought nearly Tk 60,000 crore in subsidies as the cost of imported gas, coal, and fuel oil continues to rise. To maintain affordable electricity tariffs, the government will have to absorb a significant portion of these increased expenses.
However, a key question remains: How long can the government sustain this burden?
Electricity tariffs have already been increased in recent years, and officials are not ruling out further price adjustments. One possible way to reduce subsidy costs would be to pass a larger share of the expenses on to consumers.
The gas sector is also under severe strain. Petrobangla has requested approximately Tk 27,000 crore in subsidies for just the first six months of the next fiscal year. If the conflict-driven rise in global energy prices continues, the financial pressure could intensify further, keeping uncertainty over gas prices alive.
Agriculture is facing similar challenges. International fertilizer prices have climbed, while transportation costs have also increased. As a result, the Ministry of Agriculture has requested Tk 18,000 crore in subsidies. Without government support, farmers would face higher production costs, which would eventually push up the prices of rice, vegetables, pulses, and other essential food items.
Meanwhile, the Ministry of Food has sought Tk 12,000 crore in subsidies to continue operating programs such as Open Market Sales (OMS), food-friendly initiatives, and other low-cost food distribution schemes. These programs are expected to require additional funding as economic pressures on low-income households increase.
Economists argue that while the current geopolitical crisis is a major factor, Bangladesh also faces long-standing structural problems. Inefficiencies, high operating costs, waste, and weak management in the power sector have contributed to a growing subsidy burden for years. International crises merely expose and intensify these vulnerabilities.
Perhaps the most critical question is where the government will find the money.
If revenue collection fails to increase significantly, authorities may have to rely more heavily on borrowing. Higher borrowing could increase inflationary pressures, crowd out private-sector investment, and place additional strain on the broader economy.
In other words, while the flames of conflict may be burning in the Middle East, their heat is increasingly being felt by ordinary Bangladeshis.
The government’s biggest challenge in the upcoming budget will be balancing two competing priorities: keeping electricity, gas, fertilizer, and food affordable for the public while managing an ever-growing subsidy bill.
If the conflict subsides quickly, some relief may follow. But if it drags on, both the government and the people of Bangladesh could face a much more difficult economic road ahead.
