Against the odds, Bangladesh’s interim government has reined in the economy but reforms are wanting

Bangladesh has seen many uprisings and military coups leading to the abrupt fall of a government. However, never in the country’s history did the governor and other senior officials of the central bank flee after a political change.

Even on December 17, 1971, senior-most Bangladeshi officials of the erstwhile Dhaka office of the State Bank of Pakistan walked across the road to the Mukti Bahini and Indian army camps in the stadium and reported to duty. Not so on August 6, 2024, when the Bangladesh Bank was left without a governor.

This illustrates the near catastrophe that was the economy 12 months ago. Judged against that starting point, the Interim Government has managed the economy well in the past year. However, for all the talk of reforms, Bangladesh 2.0, a new political beginning and so on, this has been an interim economy. That is, if you were expecting reforms, you would be sorely disappointed.

Let’s recall the immediate economic challenges the Interim Government faced as it took office last August.

Firstly, inflation was already at its highest in decades even before the economic disruptions caused by the uprising and then the floods in August. Meanwhile, the central bank’s stock of foreign reserves were depleting and the taka had...

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