Over the past decade, foreign development partners have contributed an average of 32.5% to Bangladesh’s Annual Development Programme (ADP). However, there has been a steady decline in concessional aid and grants. For instance, in FY 2019–20, only 32% of the ADP was funded by external resources, down from 48% in FY 2001–02. Despite this, Bangladesh has made significant strides in mobilizing domestic resources to finance development priorities.

Bangladesh’s vulnerability to climate change remains a major concern. The country ranks 7th on the Global Climate Risk Index and 163rd on the ND-GAIN Index, reflecting its exposure and limited adaptive capacity. Since the Copenhagen COP-15 summit, Bangladesh has received over USD 1 billion in climate finance. However, the economic toll of climate-induced losses is estimated at USD 3.72 billion—highlighting a critical funding gap for climate resilience and mitigation.

Agriculture remains a cornerstone of Bangladesh’s economy, contributing approximately 14% to GDP and employing 40% of the labor force. Promoting sustainable and climate-smart agricultural practices is vital to increase productivity, build resilience, and ensure long-term food security.

At the same time, Bangladesh’s large youth population presents both an opportunity and a challenge. A lack of market-relevant skills contributes to high youth unemployment. Addressing this requires significant investment in vocational training, skills development, and entrepreneurship initiatives. Donor-funded programs and private sector-led training initiatives are increasingly supporting efforts to enhance employability and stimulate inclusive growth.

The COVID-19 pandemic heightened public awareness of hygiene practices, yet access to improved sanitation remains limited for many low-income and remote communities. Continued investment in water, sanitation, and hygiene (WASH) infrastructure is essential for public health and sustainable development.

As Bangladesh approaches graduation from Least Developed Country (LDC) status, the development landscape is shifting. Reduced concessional aid may be offset by increased private sector engagement, ‘Aid to Trade’ mechanisms, and philanthropic funding. Government policies now encourage private investment and public-private partnerships (PPPs) to bridge funding gaps.

Non-governmental organizations (NGOs) remain pivotal in supporting marginalized populations—including those in hard-to-reach areas, persons with disabilities, and ultra-poor communities. Their work in empowerment, social mobilization, and capacity building remains crucial as the development sector adapts to evolving needs.

In this context, several emerging themes and funding trends are shaping the future of development in Bangladesh:

• Climate Change and Environmental Sustainability: Emphasis on climate adaptation, mitigation, renewable energy, and ecosystem protection.
• Digital Transformation: Investments in digital infrastructure, e-governance, digital literacy, and smart cities.
• Healthcare and Pandemic Preparedness: Strengthening health systems, improving service delivery, and enhancing emergency response.
• Education and Skills Development: Reducing dropouts, improving learning outcomes, and expanding vocational training.
• Gender Equality: Promoting women’s rights, preventing gender-based violence, and increasing women’s economic participation.
• Agriculture and Food Security: Fostering sustainable practices, improving productivity, and building resilient food systems.
• WASH Initiatives: Expanding access to safe water, sanitation, and hygiene services, particularly in underserved areas.
• Infrastructure Development: Building transport networks, urban infrastructure, and enhancing rural-urban connectivity.
• Social Protection: Expanding safety nets and inclusion programs for vulnerable groups.
• Private Sector Engagement and PPPs: Leveraging private investment and innovation to scale development solutions.
• Innovation and Technology: Supporting startups, digital inclusion, and emerging technologies for development.
• Governance and Capacity Building: Enhancing transparency, accountability, and institutional effectiveness.

Key development partners—including the World Bank, ADB, USAID, UNDP, European Union, JICA, DFID, and SIDA—continue to support a diverse range of sectors, reflecting both Bangladesh’s national priorities and global development agendas.

In conclusion, as Bangladesh transitions toward a middle-income economy, aligning development efforts with strategic priorities and diversifying funding sources will be essential. The country’s ability to harness innovation, build institutional capacity, and form inclusive partnerships will determine the success of its development journey in the years ahead.

The article was written by Md. Humayun Kabir, an Independent Consultant, and Director, Creative Services Limited. Email: humayun@cslbd71.com