Dr Salehuddin warns of Tk 5.0 trillion state liability risk

The immediate past interim government finance adviser, Dr  Salehuddin Ahmed, on Saturday said that contingent liabilities linked to state-owned institutions have surged to more than Tk 5.0 trillion, posing a significant fiscal risk for the government. 

Speaking at a banking and finance risk conference as the chief guest, being held at Gulshan on the day Dr Ahmed said the liabilities—largely extended as guarantees to government organisations to procure goods and services—could become a burden the state may struggle to absorb. 

“If these guarantees are called, it will be very risky for the government, as repayment capacity remains uncertain,” he said.

Contingent liabilities typically arise from government-backed guarantees and do not immediately appear in the fiscal deficit. 

However, economists caution that a sharp crystallisation of such liabilities can strain public finances, particularly at a time when Bangladesh is already navigating external and domestic economic pressures.

Dr Ahmed also raised concerns over the slow pace of the much hyped about the digital reform within the National Board of Revenue (NBR).

Despite repeated commitments to modernise systems, he said progress in automation and computerisation remains limited in the NBR.

“The level of development in terms of NBR computerisation is still minimal,” he said.