Tuesday, 09 December, 2025
Bangladesh’s long-running bad loans problem originated under former president Ziaur Rahman, yet successive parliaments have never properly examined it, one of the country’s leading economists has warned.
Prof Rehman Sobhan, chair of the think tank Centre for Policy Dialogue (CPD), made the remarks on Monday at a conference in Dhaka, highlighting the lack of meaningful parliamentary scrutiny of corruption, economic policymaking, and development practice.
“Can you imagine that the bad loan crisis, which began in Ziaur Rahman’s era and has persisted for decades, has never received proper debate in parliament?” he asked during a session titled “Development and Democracy” at the BIDS annual conference. “There has not even been a meaningful or forceful discussion on it.”
The economist’s warning comes as defaulted loans in Bangladesh’s banking sector reached 34.6 per cent of all disbursed credit until June this year — the highest level since 2000 — exposing the fragile state of the banking system and raising serious concerns about financial governance.
At the end of June 2025, total loans and advances stood at Tk 17,34,200 crore, of which Tk 5,99,964 crore had gone sour, compared with Tk 2,11,391 crore in June last year, marking a rise of Tk 3,88,573 crore within 12 months.
Prof Sobhan also criticised Bangladesh’s political culture, saying the elites now use wealth and financial influence to secure election victories, resulting in a parliament “of elites, by elites, and for elites” that shapes policy to suit its own interests.
Recalling the 1970 election, he noted that candidates then travelled modestly by bus or rickshaw, with limited assets.
“Today, you cannot imagine contesting an election without owning a Pajero. Many even aspire to receive at least one duty-free Pajero once elected as a parliamentary privilege,” he said.
The remarks underscore the persistent tension between democracy and development in Bangladesh, with parliamentary oversight of economic issues remaining weak despite decades of escalating financial risk.
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Bangladesh’s long-running bad loans problem originated under former president Ziaur Rahman, yet successive parliaments have never properly examined it, one of the country’s leading economists has warned.
Prof Rehman Sobhan, chair of the think tank Centre for Policy Dialogue (CPD), made the remarks on Monday at a conference in Dhaka, highlighting the lack of meaningful parliamentary scrutiny of corruption, economic policymaking, and development practice.
“Can you imagine that the bad loan crisis, which began in Ziaur Rahman’s era and has persisted for decades, has never received proper debate in parliament?” he asked during a session titled “Development and Democracy” at the BIDS annual conference. “There has not even been a meaningful or forceful discussion on it.”
The economist’s warning comes as defaulted loans in Bangladesh’s banking sector reached 34.6 per cent of all disbursed credit until June this year — the highest level since 2000 — exposing the fragile state of the banking system and raising serious concerns about financial governance.
At the end of June 2025, total loans and advances stood at Tk 17,34,200 crore, of which Tk 5,99,964 crore had gone sour, compared with Tk 2,11,391 crore in June last year, marking a rise of Tk 3,88,573 crore within 12 months.
Prof Sobhan also criticised Bangladesh’s political culture, saying the elites now use wealth and financial influence to secure election victories, resulting in a parliament “of elites, by elites, and for elites” that shapes policy to suit its own interests.
Recalling the 1970 election, he noted that candidates then travelled modestly by bus or rickshaw, with limited assets.
“Today, you cannot imagine contesting an election without owning a Pajero. Many even aspire to receive at least one duty-free Pajero once elected as a parliamentary privilege,” he said.
The remarks underscore the persistent tension between democracy and development in Bangladesh, with parliamentary oversight of economic issues remaining weak despite decades of escalating financial risk.
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