Bangladesh's interim government has raised electricity prices by 16.68%, the latest painful reform by the student-led administration that toppled Sheikh Hasina in August 2025. The decision tests how long the revolutionary government's honeymoon with the public can last.
The price hike, announced by the Bangladesh Energy Regulatory Commission, affects households, businesses, and industries across the country. For a family in Dhaka using 200 units per month, monthly bills will jump by roughly 500-600 taka ($4-5 USD) - a significant burden in a country where GDP per capita is around $2,800.
The interim government, led by Nobel laureate Muhammad Yunus, inherited a fiscal disaster. The previous Awami League administration kept electricity prices artificially low through subsidies, creating a structural deficit in the power sector that drained government finances. Combined with subsidized fuel and food prices, Bangladesh was spending billions annually on subsidies it could not afford.
Reform was inevitable. The question was always who would take the political hit for implementing it.
The students who led the revolution against Hasina's authoritarian rule are now in the uncomfortable position of governing. Revolutionary slogans about justice and democracy are simpler than balancing budgets and managing inflation. This is the reformers' dilemma: the policies needed for long-term economic stability are the ones that hurt people in the short term.
Bangladesh's interim government argues that subsidy reform is essential. The previous system disproportionately benefited wealthier households and industries with high consumption, while the government bled money that could have funded healthcare, education, or infrastructure. Means-tested, targeted subsidies would be more equitable.
That's economically sound. It's also politically risky.
Opposition parties - many aligned with the ousted Awami League - are already seizing on the price hikes to portray the interim government as disconnected from ordinary people's struggles. In a country where over 20% of the population lives below the poverty line, electricity and fuel price increases hit hard and fast.
Public tolerance for economic pain depends on trust. The interim government has credibility from leading the anti-Hasina movement, but credibility erodes quickly when people can't afford to turn on fans in Dhaka's brutal summer heat.
The government must now demonstrate that subsidy savings are being redirected to programs that benefit the poor - healthcare, education, social safety nets. If the savings disappear into bureaucracy or elite pockets, public anger will follow.
Bangladesh's power sector also faces structural challenges beyond subsidies. The country relies heavily on imported liquefied natural gas (LNG) and coal, making it vulnerable to global energy price shocks. Domestic gas reserves are depleting. Renewable energy investment has lagged.
The interim government inherited these problems; it did not create them. But inheritance doesn't exempt responsibility. The student-led administration must now prove it can govern, not just protest. Revolution is easier than reconstruction.
For households in Dhaka, Chittagong, and Sylhet, the 16.68% price hike is a test of whether the revolution was worth it. The interim government's challenge is to ensure the answer remains yes, even when the lights cost more to keep on.
