Bangladesh

Bangladesh has several long-horizon strategies that embed green-economy principles, led by the Bangladesh Delta Plan 2100 (approved by the National Economic Council in 2018) for water, land and climate resilience; the National Adaptation Plan (NAP) 2023–2050 (formulated 2022–2023) setting priority adaptation actions and investment pipelines; and the Mujib Climate Prosperity Plan (MCPP) 2022–2041 outlining resilience, clean energy expansion and climate-compatible growth (e.g., renewable energy shares and climate-resilient jobs). In September 2025, Bangladesh submitted its Third Nationally Determined Contribution (NDC 3.0) with an overall 20.31% emissions-reduction target by 2035 from BAU (6.39% unconditional; 13.92% conditional on international support) and sectoral targets led by energy. These instruments provide policy direction for low-carbon, climate-resilient development. However, Bangladesh has not adopted a national net-zero 2050 target, and there is no single, legally binding, economy-wide green-economy plan that consolidates decarbonisation, adaptation, fiscal policy and industrial transformation under one enforceable framework.

Bangladesh references public consultation and multi-stakeholder participation in national planning, particularly through the Whole of Society Approach in its SDG framework. The SDGs Financing Strategy (Planning Commission) recognises private sector engagement, but there is no binding national strategy mandating employee participation or gender-balance on corporate boards. The BSEC Corporate Governance Code (2018, still in force) requires independent directors and disclosure but is implemented on a “comply or explain” basis, and enforcement remains uneven. Restrictions on trade unions continue in Export Processing Zones (EPZs).

Participatory provisions exist mainly through environmental and transparency laws. The Environment Conservation Act 1995 and Environment Conservation Rules (with EIA Guidelines for Industries) provide for public hearings/comments during environmental clearance processes, and the Right to Information Act 2009 enables public access to government information. Civil-society organisations (e.g., environmental legal groups) routinely engage in consultation and litigation on environmental matters, and participatory forums appear in sector programmes and donor-supported projects. Nonetheless, mandatory, cross-government consultation requirements covering all legislation and systematic ex-ante social-impact assessments for marginalised groups (e.g., Indigenous/tribal communities, persons with disabilities, gender minorities) are not uniformly required. Practice remains project-specific, with capacity and inclusivity varying across ministries and local governments.

Bangladesh tracks SDG and sector indicators for planning, but does not operate an official national ‘beyond-GDP’ framework such as comprehensive-wealth accounting across natural, human, social and produced capital, nor a government-adopted wellbeing dashboard embedded in the budget process. Recent analysis urges green-budgeting and natural-capital accounting integration; proposals and academic indices (e.g., multidimensional wellbeing) exist but have not been formally adopted as binding instruments for fiscal, investment or infrastructure appraisal decisions.

Bangladesh Bank continues to promote green banking through its Sustainable Finance Policy and the Green Transformation Fund for export industries. In 2022 it issued a Policy on Green Bond Financing for banks and financial institutions, alongside earlier Environmental & Social Risk Management (ESRM) Guidelines. Climate priorities are also being embedded in public finance through the Inclusive Budgeting and Financing for Climate Resilience (IBFCR-II) initiative (UNDP and Ministry of Finance). However, while financial stress tests are undertaken by the central bank, they do not systematically integrate environmental and social risk factors across all institutions.

Bangladesh Bank maintains a regular, mandatory stress-testing framework covering credit, liquidity, and market risks for all financial institutions, complemented by Environmental and Social Risk Management (ESRM) Guidelines and a Sustainable Finance Policy requiring banks to set and report sustainable-finance targets. In FY2024–2025, Bangladesh Bank introduced a Monetary Policy Statement emphasising inflation control, foreign-exchange stability, and asset-quality reforms under the Interim Government’s financial-sector restructuring. Climate and environmental risks are addressed through qualitative guidance and disclosure but are not yet incorporated into quantitative stress-testing scenarios. Fiscal frameworks continue to apply the Climate Fiscal Framework and annual Climate Financing for Sustainable Development reports to track climate-tagged spending. The IMF and World Bank (2025) highlight ongoing governance and financial-sector reforms and note that environmental risk integration remains at an early stage.

Bangladesh’s trade and industrial policies increasingly reflect environmental priorities. The National Industrial Policy emphasizes green industrialization, offering incentives such as tax rebates for industries adopting environmentally friendly technologies. The government promotes waste treatment infrastructure and enforces environmental laws like the Environmental Protection Act and the Water Act. While green trade liberalization is still limited, the policy direction supports sustainable production and export competitiveness.

Bangladesh does not operate a national carbon tax or emissions trading scheme. Pilot proposals for vehicle carbon taxation were shelved in 2017, and no ETS legislation has followed. The updated NDC commits to reducing GHG emissions by 6.7% unconditionally and 21.8% conditionally by 2030, but these targets are not legally binding and are not linked to carbon pricing. Reforms under the IMF Resilience and Sustainability Facility (RSF) include fuel price adjustment mechanisms, but these are fiscal measures rather than a structured carbon pricing system.

Bangladesh has established a growing set of sustainability and climate-related sectoral policies, though integration and monitoring remain uneven. The Mujib Climate Prosperity Plan (2022–2041), the National Adaptation Plan (2023–2050), and the Bangladesh Delta Plan 2100 together provide the country’s long-term framework for green transformation, outlining sectoral priorities for energy, agriculture, industry, transport, and water management. In the energy sector, the Renewable Energy Policy 2025 targets 20 percent of electricity generation from renewables by 2030 and 30 percent by 2040. The policy promotes technology transfer, local manufacturing, energy storage, and net-metering, while offering fiscal incentives including a 10-year full tax exemption for renewable producers. Supporting instruments include the Renewable Energy Zoning Policy (2025), which designates solar and wind resource zones, and the Green Revolving Fund Pilot (2024) that provides concessional financing for industrial energy-efficiency upgrades. Despite these initiatives, renewable deployment remains below stated goals—current capacity stands at roughly 5.6 percent—and implementation is hindered by land constraints, grid limitations, and investment bottlenecks.

Sustainability measures in other sectors are progressing but fragmented. The Bangladesh Climate-Smart Agriculture Strategy (2021) promotes low-emission farming and resource-efficient irrigation; the Mujib Plan and draft Green Industry Policy aim to scale cleaner production and green certifications across industries, particularly in the Ready-Made Garment (RMG) sector; and the NDC 3.0 (2025) introduces transport-sector mitigation measures such as mass-transit electrification and vehicle-efficiency standards. Waste management and circular economy initiatives are still in early development. There is no independent, cross-sectoral authority empowered to coordinate low-carbon transition planning, with responsibilities divided among the Planning Commission, the Ministry of Environment, Forest and Climate Change, and the Power Division. Coordination mechanisms exist through inter-ministerial committees, but systematic monitoring, data harmonisation, and unified progress reporting are still limited.

Bangladesh has integrated circular economy principles into its broader development planning. The 2nd National SDG Action Plan aligns circularity with the 8th Five-Year Plan and Vision 2041, assigning responsibilities across ministries. The plan promotes resource efficiency, waste reduction, and inclusive development. Although not a standalone circular economy roadmap, the SDG-linked framework provides a foundation for circular transition through sectoral coordination and public-private engagement.

Bangladesh’s transport decarbonization efforts are outlined in the NDC Implementation Roadmap, which includes mitigation strategies for the transport sector. The plan supports emission reductions through modal shifts, infrastructure upgrades, and improved fuel efficiency. Major investments in road, rail, and maritime transport aim to enhance connectivity while reducing environmental impact. However, electrification targets and zero-emission mobility incentives are still emerging.

Bangladesh’s clean energy policy framework is defined by the Renewable Energy Policy 2025, which targets 20% of electricity generation from renewables by 2030 and 30% by 2040. The policy introduces fiscal incentives, including a 10-year full tax exemption for renewable producers, promotes rooftop solar through net-metering, and encourages local manufacturing of renewable technologies. Supporting instruments include the Renewable Energy Zoning Policy 2025, which identifies priority solar and wind zones, and the Green Revolving Fund Pilot (2024), which provides concessional financing for industrial energy-efficiency projects. The Integrated Energy and Power Master Plan (2023) and the Mujib Climate Prosperity Plan (2022–2041) set complementary objectives for low-carbon power generation and investment mobilisation. Despite this framework, renewable capacity remains at around 5.6% in 2025, below stated milestones, due to grid, land, and investment constraints.

Bangladesh promotes green employment through the Mujib Climate Prosperity Plan (2022–2041), which prioritises job creation in renewable energy, climate-resilient agriculture, and industry. The National Adaptation Plan (2023–2050) outlines livelihood diversification and reskilling actions for vulnerable groups, and the National Skills Development Authority (NSDA) has introduced training modules on green skills in collaboration with the ILO. The Poverty, Environment and Climate Mainstreaming (PECM) initiative links public investment screening to poverty reduction and resilience outcomes. While several sectoral initiatives support employment generation, there is no comprehensive national plan coordinating green job creation across ministries or addressing transitions in high-emission industries.

Bangladesh references just transition objectives across several national strategies but does not yet have a single, binding just transition law or an integrated national framework with mandated benefit-sharing rules. The Mujib Climate Prosperity Plan (2022–2041) frames inclusive prosperity, climate-resilient jobs, MSME support, and social protection as cross-cutting priorities for the energy, industry, agriculture, and infrastructure transitions. The National Adaptation Plan (2023–2050) identifies vulnerable groups, sets priority adaptation actions, and proposes institutional roles for social protection, skills, and livelihood diversification. On the fiscal side, the Ministry of Finance’s Climate Fiscal Framework and annual Climate Financing for Sustainable Development reports operationalise climate-budget tagging and require ministries to identify expenditures that support vulnerable populations; the Poverty, Environment and Climate Mainstreaming (PECM) initiative pilots screening criteria that ask public investment proposals to demonstrate poverty benefits, resource impacts, and resilience outcomes. Skills and employment agencies have started green-skills and reskilling initiatives within wider employment policies. These measures amount to integrated pilots and procedures that balance social and environmental considerations in planning and budgeting. However, they are not consolidated into a national just transition statute; sectoral roadmaps with explicit benefit-sharing mechanisms for affected workers and communities (e.g., in power, heavy industry, or transport) are still limited, and implementation remains fragmented across ministries and development-partner programmes.

Bangladesh has no dedicated legal form for social enterprises. MSMEs receive general financial support through Bangladesh Bank’s SME credit programs, but targeted green-MSME schemes remain limited. The Framework for Implementing Green Growth (2023) identifies enabling conditions for private investment in sustainable industries, and the Bangladesh Climate Advisory Partnership (B-CAP), launched by IFC and DANIDA in 2023, aims to catalyse climate-smart private investment, including in manufacturing and green finance. However, these are enabling or donor-driven initiatives rather than structured national regulatory or financial mechanisms.

Bangladesh has a well-established social-protection framework, which is gradually incorporating climate and environmental dimensions. The National Social Security Strategy (NSSS) and the Mujib Climate Prosperity Plan (2022–2041) highlight the need to expand adaptive social protection for vulnerable populations affected by climate change, particularly in coastal and flood-prone areas. The Poverty, Environment and Climate Mainstreaming (PECM) initiative promotes public investment screening to ensure that projects benefit low-income groups and enhance climate resilience. The Integrated Budget and Finance for Climate Resilience (IBFCR) programme, supported by the Ministry of Finance, integrates climate expenditure tracking and vulnerability mapping into budget processes. In 2024, Bangladesh launched a pilot Climate Resilience Fund under the Ministry of Disaster Management and Relief to provide conditional cash transfers to communities impacted by extreme weather. The government also collaborates with development partners (UNDP, WFP, GCF) to pilot adaptive social protection and shock-responsive safety nets, linking disaster response with longer-term resilience building. However, national coverage remains limited, and most pilots are donor-driven rather than institutionalised within the domestic welfare system

Bangladesh’s current national biodiversity strategy is the NBSAP 2016–2021, which set 20 national targets aligned with Aichi/SDG objectives and identified actions across protected areas, species conservation and sustainable use. The legal basis for conservation and environmental control derives from the Environment Conservation Act 1995 (including designation of Ecologically Critical Areas) and related rules; protected-area management sits with the Forest Department and Department of Environment. Since 2022–2024, authorities have continued site-level designations and management actions, and biodiversity objectives are referenced in wider plans (NAP; MCPP). As of October 2025, a publicly released, GBF-aligned NBSAP update with national targets, monitoring indicators and a formal progress-assessment cycle has not yet been issued.

Bangladesh has initiated technical work on natural capital valuation, particularly water resources and forestry, but lacks a comprehensive national strategy. The Bangladesh Delta Plan 2100 references environmental valuation for long-term resilience planning, and the National Adaptation Plan 2023–2050 highlights ecosystem services. However, Bangladesh is not part of the NCAVES pilot, and no statutory independent body advises government on natural capital integration into fiscal or infrastructure decisions. Progress remains limited to feasibility studies and environmental statistics.

Bangladesh has a comprehensive National Food and Nutrition Security Policy Plan of Action (2021–2030), developed by the Ministry of Food and supported by FAO. The plan aligns with SDGs 2 and 12 and includes interventions across production, nutrition, food safety, and waste reduction. It promotes healthy diets, addresses micronutrient deficiencies, and includes strategies for climate-resilient agriculture and subsidy reform. The policy is supported by a multi-stakeholder coordination mechanism and monitoring framework.

Bangladesh is scaling biodiversity/climate finance planning but remains at an early stage for dedicated nature-finance instruments. In May 2025, the Government and UNDP launched the BIOFIN “Umbrella Programme to Support Development of Biodiversity Finance Plans,” outlining actions such as a prospective National Biodiversity Trust Fund, payments for ecosystem services, and revenue-sharing (e.g., eco-tourism). The Ministry of Finance’s Climate Fiscal Framework (2014) and annual Climate Financing for Sustainable Development reports underpin climate budget tagging and tracking across ministries and have been slated for updates under new climate-finance programmes (IBFCR Phase II, 2025). The Bangladesh Bank’s Sustainable Finance Policy (2020; reporting updates 2023–2025) requires banks/financial institutions to set sustainable-finance targets and report green-finance flows, creating an enabling environment for nature-related investment. However, private-sector nature instruments (e.g., biodiversity credits), broad fiscal reforms (e.g., removal of harmful subsidies), and targeted, large-scale public transfers to IPLCs remain limited in national policy.

During COVID-19 (2020–2021), Bangladesh deployed fiscal/financial measures (liquidity, credit guarantees, cash-transfer and SME support) as part of macro-stabilisation. These were not structured with environmental or just-transition conditionality. Post-pandemic, Bangladesh has embedded climate considerations into broader economic policy via the Climate Fiscal Framework and annual climate budget reports, and has mobilised international climate finance (e.g., IMF programme with a climate window; multilateral development finance) alongside the Green Growth/industry policy recommendations (2023). Targets for renewable energy and energy efficiency appear in sector policies and the MCPP, but there is no standalone green-stimulus package that accounts for a significant share of GDP with binding environmental or social conditions attached to general economic support.