As Bangladesh inches closer to its long-anticipated graduation from the Least Developed Country (LDC) category in November 2026, a milestone in its socio-economic journey, concerns are growing that the graduation may not reflect the ground realities of everyday life for millions of Bangladeshis.
While international recognition of development progress is a moment of pride, it also brings challenges that expose the country’s persistent structural weaknesses—ranging from overdependence on a single export sector to rising inequality, inflationary pressures, and jobless growth.
The existing graduation criteria fail to capture deep-rooted structural challenges afflicting graduating countries like Bangladesh. These include weak industrial bases, low labour and capital productivity, skills shortages, digital divides, and limited readiness for the Fourth Industrial Revolution (4IR).
A major challenge for Bangladesh will be the loss of International Support Measures (ISMs) upon graduation, according to analysts.
These include duty-free quota-free (DFQF) market access under various Generalised System of Preferences (GSP) schemes, waivers under the Trade-Related Aspects of Intellectual Property Rights (TRIPS), and other forms of aid-for-trade and policy flexibilities.
In 2018, the United Nations’ Committee for Development Policy (CDP) first confirmed that Bangladesh met all three criteria for LDC graduation: gross national income (GNI) per capita, human assets, and economic vulnerability. Following a preparatory period and successful reviews, the graduation is set for 2026.
Graduation will lead to a gradual phasing out of duty-free, quota-free access to markets in the European Union and other countries—facilities Bangladesh has relied on as an LDC under initiatives like the EU’s Everything But Arms (EBA).
Despite a rising GNI per capita, many argue that the benefits of growth have not been evenly shared. Officially, Bangladesh reached lower middle-income status in 2015, but around 30% of the population still lives close to the poverty line, vulnerable to economic shocks.
A recent report from the General Economics Division (GED) of the Planning Commission noted a paradox: while the economy grows on paper, household income stagnates, and inflation erodes purchasing power. The country’s Gini coefficient—a measure of inequality—has also worsened.
While Bangladesh has made significant strides in infrastructure and human development, concerns about governance, transparency, and institutional capacity remain.
According to Transparency International Bangladesh (TIB), regulatory weaknesses, bureaucratic inertia, and corruption continue to undermine development efforts. These issues could be more detrimental in the post-graduation phase, when concessional financing and international aid may dwindle.
Bangladesh’s vulnerability to climate change, rising debt, and global economic uncertainty further complicates the outlook.
In 2024, external shocks—including oil price volatility, falling remittance inflows, and global demand contraction—exposed the fragility of Bangladesh’s economic base. The taka depreciated sharply, and foreign exchange reserves dipped to alarming levels.
Graduation from LDC status removes Bangladesh from certain international support mechanisms, including preferential treatment in WTO negotiations and access to climate adaptation funds earmarked for LDCs.
The government has adopted a “Smooth Transition Strategy” in collaboration with development partners, which includes efforts to boost export diversification, enhance domestic revenue mobilisation, and improve the business climate.
However, stakeholders stress that effective implementation—not just plans on paper—is crucial.
LDC graduation in 2026 will mark a historic moment for Bangladesh. But unless the government addresses the disconnect between macroeconomic indicators and people’s lived realities, the promise of prosperity may remain elusive.
The path ahead demands inclusive growth, institutional reform, and global cooperation—lest the graduation become a statistic rather than a transformation.
Policy Research Institute (PRI) director and eminent economist of the country MA Razzaque while talking to UNB over telephone said that there is risk ahead after the LDC graduation if the country failed to take proper preparation.
“Now the question is how much preparation we have taken so far. But if we do not take propoer preparation, we might face other consequences,” he said.
He put emphasis on moving for Free Trade Agreement (FTA) with potential countries for improving trade and commerce. “But the basic preparation for this FTA has to be taken is bot seen so far,” he said.
In this connection he mentioned about tariff rationalisation like the customs duties to avert future complexities.
“We have not announced pur tariff policy so far, Pakistan already implemented their tariff policy and will reduce all tariffs to 9-10 percent,” he said.
Replying to a querry, Razzaque said only the government can answer why Bangladesh till now failed to implement the tariff policy.
“There are meetings, talks, but no visible progess,” he said.
While his attention was drawn about the three years grace period Bangladesh trying to get for LDC graduation, he questioned with that time extension will Bangladesh be ready?
“We are not taking preparations at all right now, we are not ready, revenue collection is not increasing, customs clearance is not wuick,” he said.
Responding to a question, he said that after LDC graduation Bangladesh might lost duty free access.
“It means if you can not do your trade and conmerce properly, how the common or mass people will get he benefits of this graduation,” he said.
He said that mass people will get the benefit if the preparation of the country is done properly. “For that we have to increase out competitiveness, increase export, find out new markets,” he said.
He also said that after observing everything there is mothing to become hopeful. “We have lost our opportunity, we have just waste our time,” he added.
Bangladesh’s per capita income reached a record $2,820 in the fiscal year 2024–25, marking an $82 increase from $2,738 in 2023–24, according to provisional data released by the Bangladesh Bureau of Statistics (BBS) on May 27.
In local currency terms, this translates to Tk 339,211, up from Tk 304,102, calculated using an average exchange rate of Tk 120.29 per US dollar, compared to Tk 111.06 previously.
