Bangladesh's heavy reliance on fossil fuel imports has emerged as a major threat to its fiscal health and overall macroeconomic stability. Despite mounting fiscal pressures and increasing volatility in international energy markets, the country continues to raise its subsidy allocations for the power and energy sector. In the national budget for FY25-26, the government allocated Tk 37,000 crore in subsidies for this sector—slightly lower than the originally proposed Tk 40,000 crore for FY24-25. However, the revised power subsidy for FY24-25 was later increased to Tk 62,000 crore.

Bangladesh may face economic challenges due to prolonged volatility in the international fuel market, driven by U.S. sanctions on Russia, a senior government policymaker has warned.

“We are closely monitoring the international oil market as we prepare to negotiate with global suppliers next month to meet local fuel demand for 2026,” said Power and Energy Adviser Muhammad Fouzul Kabir Khan, speaking to Just Energy News on Friday.

Powering a new national confidence

It begins like a story out of science fiction. A fishing boat drifts quietly on the Padma River before dawn, its oars slicing the mist as the first light spills across the horizon. In the distance, two immense silver domes shimmer in the half-dark, towers of concrete and steel that hum with the quiet promise of atomic fire. The boatman pauses, staring at them as if looking at another world. For decades, this river has carried grain, timber, and jute; now it reflects the glow of a nuclear age.

A $350m maiden WB support expected to be available from next month
Country's liquefied natural gas (LNG) import financing is set to get an impetus from next month (November) with the availability of fiscal support from World Bank (WB).The WB's US$350-million support under its Energy Sector Security Enhancement Project (ESSEP), aimed at improving Bangladesh's gas supply security facilitating affordable financing for LNG imports, is expected to get rolling from next month, Petrobangla's director for finance AKM Mizanur Rahman told The Financial Express Monday.

Experts warn that unless new gas fields are discovered and production begins from untapped reserves, the country’s local supply could run dry within the next eight years

Bangladesh's natural gas reserves are dwindling fast, pushing the country to depend heavily on costly spot purchases of liquefied natural gas (LNG) to keep industries and power plants running.

The development comes following a request from Russia for assurance that no taxes would be imposed on ASE or its nominated agent when repatriating the funds to Russia

The interim government has decided to grant full tax exemption on both principal and interest payments related to the Rooppur Nuclear Power Plant loan to Russian state-owned company Atomstroyexport (ASE), a subsidiary of Rosatom, and its designated agents.

More often than not, a T-shirt bought from countries like the United States of America (USA) and Australia will have a tag saying, "Made in Bangladesh", reflecting the position Bangladesh's RMG sector holds in the international market. The RMG sector contributes to 81 per cent of the country's export earnings, making it an essential benefactor to Bangladesh's economy. However, when it comes to international trade, it is important not only to establish yourself but also to ensure that you maintain that position.

By recently endorsing Bangladesh's Third Nationally Determined Contribution (NDC 3.0) on time, the interim government continues the country's climate commitments. The NDCs are periodically prepared by the countries that are parties to the United Nations Framework Convention on Climate Change (UNFCCC) to declare their carbon/greenhouse gas emission reduction plans. Previously, Bangladesh submitted its Intended NDC in 2015, and the updated NDC (NDC 2.0) in 2021.

Adani Power Limited’s Godda power plant, which was declared as a Special Economic Zone (SEZ) by the Central Government in March 2019, supplies electricity exclusively to Bangladesh.

The Centre has granted approval to Adani Power Limited (APL), a large thermal power producer, to lay an overhead transmission line to connect its Godda Ultra Super Critical Thermal Power Plant with the Indian grid through a Line-In Line-Out (LILO) arrangement of the Kahalgaon A–Maithon B 400 KV line. As of now, the Godda plant supplies electricity exclusively to Bangladesh.

United pays portion of arrears, Meghna takes matter to court

The interim government has initiated a move to recover around Tk1,500 crore in unpaid gas bills from Meghna and United Groups after reclassifying three of their power plants as captive units rather than independent power producers (IPPs).

The scheduled trial run of Rooppur Nuclear Power Plant's first unit in December 2025 is now unlikely, while it is also uncertain whether the second unit can begin production as planned in December 2026, according to the Implementation Monitoring and Evaluation Division (IMED).

Despite the revised schedule, neither unit is expected to begin electricity generation within the planned timeline, according to the IMED's report based on its findings from the project office.

Private investors can now set up renewable energy-based power plants, choose their customers, negotiate prices and use the national grid to deliver electricity -- removing the state-run Power Development Board (PDB) as the sole buyer and seller from the process, according to a new policy.

With a dozen incentives for manufacturers, importers and users, the government plans to mandate that at least 30 percent of all vehicles procured by government, semi-government, autonomous and corporations be electric by 2030.

The draft National Electric Vehicle (EV) Policy 2025, led by the Ministry of Industries, sets out a roadmap to cut transport-sector emissions, reduce dependence on fossil fuels and promote cleaner mobility.

The country's overall gas supply dropped further last fiscal year, despite higher LNG imports, due to a continued decline in domestic production.

The country requires around 3,800 million cubic feet of gas per day (mmcfd) to stabilise the power supply and feed factories and industries. In fiscal 2024-25, the average daily gas distribution stood at 2,526 million cubic feet of gas a day (mmcfd), down from 2,715 mmcfd the previous year.

Chinese authorities have assured that its hydropower project over the Yarlung Tsangpo River flowing through India and Bangladesh as Brahmaputra would not affect Bangladesh, a lower riparian country already hit hard by unilateral withdrawal of water from cross-border rivers upstream.

China has claimed that a scientific study for the hydropower dam being constructed on the river under a hydropower project found that it would hurt none, but would only benefit all.