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The total allocation for agriculture, fisheries and livestock in the proposed FY27 budget has increased, but economists and agricultural experts say the rise remains insufficient when adjusted for inflation and overall budget expansion.
They warn that a decline in real-term investment in agriculture could weaken food security, increase import dependence and slow sectoral modernisation, although several targeted incentives and infrastructure measures have been welcomed.
Prof Golam Hafez Kennedy, secretary general of the Bangladesh Agricultural Economists Association, said agricultural investment should be treated as a priority due to its direct link with food security and economic returns.
“We always have a demand that, since our population is large, budget allocation should increase. We believe this is an investment. Investment in agriculture is a profitable one, and investment in agricultural research creates opportunities,” he said.
He noted that while agricultural commercialisation is a positive trend, the sector’s share in the total budget has declined in percentage terms.
“This is a crisis-time budget prepared under unusual global economic pressures, including energy price volatility and international challenges. That is why we are not overly critical, but we would have preferred a higher allocation than last year,” he added.
Kennedy stressed that stronger investment in agricultural research is essential amid shrinking farmland and rising production challenges.
“Increased research funding can generate employment, improve crop varieties and help address climate-related risks. A larger allocation would have made the budget more forward-looking,” he said.
Agricultural economist Jahangir Alam Khan said the growth in the agriculture budget is minimal compared to inflation and overall budget expansion.
“With inflation around 9% and the agriculture budget increasing by only 1.19%, the allocation has effectively declined in real terms by nearly 8%,” he said.
He warned that the trend could pose risks to food security.
“The agriculture budget is not growing in line with the national budget. Since FY12, the national budget has increased about 5.73 times, while the agriculture budget has grown only 3.74 times,” he said.
Khan added that rising food imports and persistent inflation further highlight the need for stronger investment.
“If we want to reduce food inflation, lower import dependency and ensure food security, the agriculture budget should be at least 10% of the total national budget,” he said.
Despite concerns, he acknowledged several positive proposals in the budget, including an increase in food grain storage capacity from 23.13 lakh tonnes to 24.5 lakh tonnes and a higher procurement target of 41.29 lakh tonnes.
“These steps could help stabilise prices and strengthen government intervention in the market during price shocks,” he said.
Khan also highlighted fiscal measures aimed at agriculture and allied sectors, including VAT withdrawal on 36 raw materials used in pesticide production and zero-duty benefits for zinc-related inputs and veterinary medicine imports.
Additional concessions include zero-duty import facilities for selected raw materials used in poultry and dairy industries, exemption of VAT on fertiliser traders, and withdrawal of import duty on pesticides.
“These measures may help reduce input costs, but strict monitoring is necessary to ensure benefits reach consumers,” he said.
Khan cautioned that rising input costs and weak budget growth could discourage production and increase import dependency.
“If agricultural production is discouraged, import dependence will rise further and controlling food inflation will become more difficult,” he warned.