The ongoing conflict in the Middle East has triggered an abnormal surge in global energy prices, significantly increasing Bangladesh’s subsidy burden. In this context, Finance Minister Amir Khasru Mahmud Chowdhury has said that the government will need to spend approximately Tk 36,000 crore in additional subsidies beyond the allocated amount for the power, fuel, and LNG sectors during the March–June period of the current fiscal year.
He made the remarks on Friday (April 10) in a statement delivered under Rule 300 in the National Parliament, where he presented an overview of the country’s overall economic situation.
The finance minister said that the more-than-doubling of international prices for fuel oil and LNG has necessitated this additional subsidy. As a result, the budget deficit will widen, while an additional import cost of around $3 billion will put pressure on the country’s foreign exchange reserves.
He further noted that within just 10 days of assuming office, the Iran–Israel war in the Middle East began, creating new uncertainties in the global energy market, supply chains, and international trade. The prices of fuel oil and LNG have risen more than twofold in the international market.
“As a consequence, the government will have to provide an additional subsidy of around Tk 36,000 crore in the power, fuel, and LNG sectors during March–June of the current fiscal year. This will not only widen the budget deficit but also impact foreign exchange reserves, as approximately $3 billion will be required to cover the increased import costs,” he added.