Bangladeshi Companies Against Quarterly Increase in Energy Prices: Reports

They argue that this strategy would impose a significant burden on consumers, negatively impact the industry and hinder overall economic progress.

Business leaders have expressed concerns about the government’s plan to end energy subsidies by December 2026, which would involve raising energy prices four times a year as mandated by the International Monetary Fund (IMF). They believe this approach would significantly burden consumers, negatively impact industries and hinder overall economic growth.

Bangladesh is adhering to IMF provisions for its $4.7 billion loan and has committed to phase out subsidies in the gas and power sectors by 2026.

An IMF delegation is currently assessing the conditions for the disbursement of the third loan tranche.

At a recent meeting in the capital Dhaka, Power Division officials reportedly announced plans to gradually increase electricity tariffs every three months, with the aim of eliminating all subsidies by 2026.

Industry people have stressed that Bangladesh’s transition from least developed country (LDC) status in November 2026 would see the withdrawal of export subsidies, even as the end of electricity and gas subsidies is expected to push up production costs, which may deter new investment and job creation. and export competitiveness.

Furthermore, the complete elimination of subsidies could fuel inflation and dampen consumer demand, ultimately hampering overall economic growth.

The recent escalation in electricity prices took place in March, with plans announced for further increases in June, October and December this year, followed by incremental increases in March, June, October and December over the following two years.

However, officials assured the IMF team that prices would be adjusted gradually with each increase to mitigate the sudden impact on consumers.

Fiber2Fashion News Desk (DR)