Bangladesh’s rapid economic expansion is significantly increasing its demand for energy, with a growing reliance on fossil fuels posing challenges for a sustainable future, according to the latest annual report by the Asian Development Bank (ADB) released on Thursday.
The report highlights that while Bangladesh’s development trajectory has been strong, it has also intensified pressure on energy resources. An ADB study published in 2025 suggests that transitioning to low-carbon energy systems is achievable, but it will require consistent policy support, substantial investment, and shifts in consumption behaviour.
Beyond energy, the report identifies infrastructure gaps - particularly in transport - as a key barrier to economic efficiency. Weak connectivity continues to increase business costs and limit regional trade opportunities. To address this, ADB committed $688 million in 2025 to upgrade a major railway link between Chattogram and Dohazari, part of a broader regional corridor. The project aims to improve passenger and freight movement while introducing energy-efficient technologies.
The financial sector also remains a concern. ADB noted that governance weaknesses and limited oversight have constrained banking performance, affecting credit access, particularly for small and medium enterprises. To address this, the bank approved $500 million to strengthen supervision, enhance governance, and expand digital financial services.
The report also draws attention to humanitarian and environmental pressures. In Cox’s Bazar, over 10 lakh displaced people from Myanmar continue to strain local infrastructure. ADB has committed additional funding to improve living conditions and community services, including water, sanitation and solar-powered lighting.
Bangladesh’s garment sector, which accounts for more than 80 per cent of export earnings, faces increasing pressure from global buyers to adopt environmentally sustainable practices, prompting a need for industrial modernisation.
Overall, ADB’s 2025 operations reached $29.3 billion, reflecting a 20 per cent increase from the previous year.
ADB President Masato Kanda said the bank’s expanded support aims to generate millions of jobs and benefit over 18 crore people across Asia and the Pacific, positioning the region to better manage economic and environmental challenges.
