Govt Forms Committee to Shield Economy from Global Crisis

The government has established a senior ministerial committee to develop strategies to protect the national economy from potential fallout caused by the escalating conflict involving the United States, Israel and Iran.

A gazette notification issued by the Cabinet Division on Monday confirmed the committee’s formation, which will be chaired by the adviser to the Finance Ministry.

Members include officials from ministries responsible for local government, rural development and cooperatives, foreign affairs, industries, commerce, power, energy and mineral resources, and food.

The committee’s mandate includes reviewing policy and administrative measures, assessing emerging economic risks, and recommending steps to strengthen coordination and crisis management across government agencies. Officials from other ministries or divisions may be invited as needed, with the Finance Division serving as secretariat.

The decision comes amid growing concerns that the Middle East conflict could disrupt global trade, energy supplies and financial markets. Bangladesh, heavily reliant on imports, is considered particularly vulnerable to external shocks in fuel and commodity sectors.

Economists welcomed the move as a timely response. M Masrur Reaz, chairman and CEO of Policy Exchange Bangladesh, noted that inflation has remained above 9 percent for nearly three years due to rising food prices, currency depreciation and increased import costs.

Private investment has also fallen to around 22.5 percent of GDP in fiscal year 2025, the lowest in five years, raising concerns about future growth and employment.

The energy sector continues to face fiscal pressure from high generation costs and large capacity payments, adding to government financial strain. Reaz warned that a further escalation of global hostilities could worsen these vulnerabilities, disrupt exports, affect overseas migration, and create uncertainty around remittance inflows, which are vital for the economy.

Energy markets pose the most immediate risk, as any surge in global oil prices or supply chain disruption could sharply increase Bangladesh’s import bill.

Economists emphasised that coordinated action among ministries and agencies will be essential to mitigate the impact of a prolonged global conflict. Reaz said a ministerial platform could improve monitoring, accelerate decision-making and ensure a unified response if conditions deteriorate.

He stressed the need for urgent action: “The government must immediately assess risks and prepare responses with stakeholders within and outside government, as well as with global partners. With growing geopolitical tensions, there is little room for delay.”