Politics
Dhaka Reduces Infrastructure Budget as Bill Reallocates Funds to Chittagong, Sylhet
Dhaka households face revised property tax assessments and updated bus route subsidies as the bill recalibrates funding shares across major cities based on 2025 census data.
How we reported this
The Local Government (City Corporation) Amendment Bill 2026, passed on 2 July, revises the formula that distributes central grants to city corporations. Dhaka now receives 42 percent of the national urban infrastructure pool, up from 38 percent, while Chittagong drops to 19 percent and Sylhet to 7 percent. The change directly alters how much each city spends on roads, drainage and public transport subsidies.
Why the shift occurs now
The Ministry of Local Government cited the 2025 population census, which recorded Dhaka at 22.4 million residents. The legislation states that allocations must reflect updated headcounts and revenue collection capacity. Policy analysts note the adjustment follows the tabling of the 2026-27 national budget on 11 June, which set the urban grant total at 18,750 crore taka.
For Dhaka residents the bill alters two immediate services. Property tax notices issued after 1 January 2027 will use a new valuation band that applies to buildings above three storeys. Bus operators receiving route subsidies must publish revised timetables showing an expected 12 percent increase in daily trips on the Mirpur-Uttara corridor.
Comparison with peer cities
Chittagong City Corporation will lose 310 crore taka in annual grants, leading to a projected delay in the second phase of the Karnaphuli bridge approach roads until 2028. Sylhet will receive an extra 45 crore taka for flood embankments but must reduce its street-lighting budget by 18 percent. Dhaka’s larger share funds the extension of the MRT Line 5 from Gabtoli to Tongi, with construction tenders scheduled for September 2027.
The legislation requires each city corporation to publish quarterly expenditure reports on its website. Local advocates note that residents in Dhaka wards 15 and 23 can already view the draft allocation for new footbridges over the Turag River. Implementation begins with the new financial year on 1 July 2027.