Finance Adviser Dr Salehuddin Ahmed on Sunday said the current interim government would leave Bangladesh’s economy in a “satisfactory and stable” position for the next elected government, though he acknowledged that significant challenges remain ahead.
“I believe we are leaving the economy in a satisfactory place. The next government will not face major difficulties in continuing from here. The situation is stable now — not shaky like before,” he said.
Speaking to reporters after the Government Purchase meeting at the Secretariat, Dr Salehuddin said the economy is no longer in a fragile or unstable condition, unlike earlier periods, and that the foundations have been stabilised to allow future governments to move forward.
Responding to questions on whether the government had taken on record levels of debt, the finance adviser said while borrowing had increased, a substantial amount of external debt had also been repaid.
“Yes, borrowing increased, but we also repaid around six billion dollars in external debt. Debt repayment is equally important,” he said, adding that many large, expensive infrastructure projects were deliberately avoided.
“We did not go for costly mega projects like tunnels or projects worth thousands of crores through loans. That is why public debt pressure did not worsen further,” he said.
He admitted that employment generation remained one of the government’s biggest challenges, largely because job creation requires sustained support for small and medium industries.
“Our major challenge was employment. For that, small and medium enterprises are essential. But we did not have enough fiscal space. Large factories are not labour-intensive, and they come with many complexities,” he explained.
Addressing concerns over contradictory statements about future economic risks, Dr Salehuddin clarified that while the economy is stable, reforms need to be consolidated and carried forward carefully.
“What we have done is not a one-off solution. To take it forward, it needs to be strengthened further. That itself is a big challenge,” he said, noting that access to concessional foreign aid has declined, making future financing more difficult.
He stressed that reforms require time, cooperation and procedural discipline, which are often difficult in Bangladesh’s complex administrative system.
“Reform is not just about speeches. It requires process, cooperation and patience. Inside the system, procedures are extremely complicated. Without cooperation, it becomes very difficult,” he said.
Highlighting governance reforms, the finance adviser said the government has made significant progress in digitising land records and khatian maps, making services cheaper and more accessible to citizens.
“Porcha and land records are being digitised. Now people can get services for Tk20, which earlier cost Tk500. We are expanding digital access nationwide,” he said.
He described the initiative as one of the most fundamental service delivery reforms, reducing harassment and improving transparency.
Dr Salehuddin also confirmed that the government is preparing to face international arbitration over alleged financial disputes and money laundering allegations involving business interests linked to S Alam Group.
He said a case has been filed at the International Centre for Settlement of Investment Disputes (ICSID), a World Bank-affiliated arbitration body, following complaints lodged by the concerned party.
“They have gone for arbitration at the World Bank forum. We have received notice and must respond. This is a very serious matter involving a large amount of money,” he said.
The government has decided to engage international legal counsel to contest the case, he added.
“We will engage a legal firm. This is not a simple issue. Legal preparation is essential,” he said, though he declined to disclose the name of the firm at this stage.
A government team is expected to visit Washington, DC, to deal with the arbitration process, he said.
On power sector reforms, the finance adviser said electricity tariffs are being rationalised rather than increased arbitrarily.
“This is tariff restructuring, not a price hike. Money is being adjusted from one segment to another. It will not affect electricity supply,” he said, adding that efficiency issues at power plants such as Ashuganj are also under review.
Dr Salehuddin said despite criticism, many fundamental reforms had been undertaken, even if they were not always visible.
“People say nothing has been done because they only look for visible projects. But many fundamental procedural reforms have taken place. If someone does not want to see, they will not see,” he remarked.
The government has appointed a British law firm to contest an international arbitration case filed by S Alam Group founder Saiful Alam and his family before the International Centre for Settlement of Investment Disputes (ICSID).
Sources familiar with the decision said the Advisory Committee on Government Procurement has approved the appointment of White & Case LLP, a UK-based international law firm, to represent Bangladesh in ICSID arbitration case No. ARB/25/52. The firm will be paid a fee of US$1,250 per hour for its legal services.
The proposal to hire an international law firm was placed before the committee by the Ministry of Law, Justice and Parliamentary Affairs, citing the complexity and high financial stakes of the case.
Speaking to journalists after the meeting, Finance Adviser Dr Salehuddin Ahmed said the arbitration was linked to allegations of money laundering.
“S Alam has apparently filed a case in London and challenged Bangladesh at the World Bank’s ICSID. We need to engage an international legal firm to fight this case, as it involves a huge amount of money and has been brought before an organisation like the World Bank,” he said.
When asked about the identity of the firm, the adviser said it was a British firm but did not name it at the time.
Dr Salehuddin also said legal action was underway against S Alam over alleged money laundering.
“When a government or a company is accused of obstructing business, ICSID arbitration is invoked. We have received the arbitration notice and must respond. This is a highly complicated legal process,” he added.
In October last year, lawyers representing S Alam and his family formally filed the arbitration request at ICSID in Washington, alleging that asset freezes, confiscations and punitive measures taken by the Bangladesh government over money laundering allegations caused them losses worth hundreds of billions of dollars.
In their filing, the S Alam family claimed that the interim government has deliberately targeted them through bank account freezes, asset seizures, “baseless investigations” into their businesses and a “provocative media campaign,” arguing that such actions violate international investment protection obligations.
The arbitration has been filed under the 2004 Bangladesh–Singapore Bilateral Investment Treaty (BIT). Documents show that members of the S Alam family renounced Bangladeshi citizenship in 2020 and obtained Singaporean citizenship between 2021 and 2023. They are currently residing in Singapore.
As Singapore nationals, they claim entitlement to international investment protection under the BIT, as well as protection under Bangladesh’s Foreign Private Investment (Promotion and Protection) Act, 1980.
Following the August 5, 2024 mass uprising that led to the fall of the Sheikh Hasina government, an interim administration headed by Prof Muhammad Yunus initiated investigations and asset recovery efforts against major business groups and influential individuals accused of large-scale money laundering.
An economic white paper published by the interim government in December 2024 estimated total illicit capital flight at around US$234 billion. Bangladesh Bank Governor Ahsan H. Mansur, who heads the asset recovery task force, has alleged that the S Alam family alone siphoned off nearly US$12 billion abroad.
He accused S Alam and his associates of taking control of multiple banks with the help of military intelligence and transferring funds overseas through loan and import fraud, forcing the government to bail out six banks.
S Alam Group has denied all allegations, saying the government has failed to present any credible evidence to support the claims.