Too late to ignore: Why green growth matters now

Bangladesh's existing economic model needs redesign. The one that heavily depends on fossil-fuel energy, outdoor labour, and export manufacturing is struggling to cope with climate change. 

Diverting towards green economy isn't an option now, it's the best path to protect jobs, stable growth and keep people out of poverty. 

A green economy, defined by the United Nations Environment Programme (Unep), improves human well-being and social equity while reducing environmental risks and ecological deficits. 

Simply shifting investment for clean energy, resource-efficient industries and low-carbon infrastructure, while assuring workers and community are not left behind. 

In 2024, it broke a 76-year record for 26 consecutive days of heatwave, according to Climate Home News 2025. Heat-related illnesses forced the loss of roughly 250 million workdays, costing the economy up to $1.78 billion, roughly 0.4% of GDP. 

Bangladesh Bank's green refinancing programme remains inaccessible to small and medium enterprises (SMEs) from the bulk of the productive economy. 

According to the report of the Grantham Research Institute on Climate Change and the Environment, the ready-made garment (RMG) sector, with 80% women among four million workers, has seen an estimated 30% job displacement from automation, where women are disproportionately affected. 

Getting the green transition right is not just an energy question; it is a labour market question.

Apart from productivity, other social vulnerability also increases due to climate change. A recent World Bank study showed that Bangladesh's poverty rate rose from 18.7 % in 2022 to 21.4 % in 2025, with around 1.4 million people falling under the poverty line in 2025 alone and 8.5% inflation in FY26, people with low wages have suffered significantly.

Bangladesh, paralysed by fuel-dependent generation, sits under some of the most consistent sunlight in Asia. This summer, electricity demand exceeded 16,000 megawatts, but generation remained between 13,000 and 14,000 megawatts; this deficit is managed through load-shedding, mostly affecting rural populations. 

Fossil fuel dependency that built this system is now the same thing breaking it. A shift toward solar and renewable infrastructure is no longer an ideological preference but a supply-security argument, and increasingly the only economic strategy that makes fiscal sense for Bangladesh.

A study by LightCastle Partners found that Bangladesh faces around $3 billion in climate-related losses annually which is almost 1%-2% of Bangladesh's GDP. 

Studies indicate that between 22%-68% of global economic losses from reduced labour productivity can be compensated through adaptation measures. 

Recent studies state that Bangladesh's capacity for renewable energy currently stands around 1,557 megawatts, including solar for about 81% of that figure. 

Within South Asia, Bangladesh stands in third position in renewable energy employment. Solar energy sector employment grew at an annual rate of 18.5% between 2011 and 2016, nearly 10 times the national employment growth rate of 1.9%. 

Countries like Bangladesh, where young unemployment is 10% and 85% of workers are in informal employment, that kind of job creation is a great opportunity. 

Bangladesh is now the global leader in sustainable apparel, proudly hosting 62 of the world's top 100 green-certified garment factories. 

Scaling up green manufacturing, retrofitting factories with passive cooling and efficient energy systems and exporting to international markets where sustainable sourcing is increasingly a condition of entry is a credible industrial strategy.

Dhaka's designated parks and gardens account for just 7% of the city's land. The heat index of Dhaka has increased by 65% above the rest of the country. 

The urban green infrastructure, including tree cover, rooftop gardens and green corridors, could measurably reduce urban heat with cooling energy demands. 

Renovating the factory with shading rooftops, reflective surfaces and passive ventilation reduces indoor temperature during peak production hours. 

According to a report of Grantham Research Institute on Climate Change and the Environment's study, energy efficiency improvements in Dhaka's brick manufacturing industry delivered cost savings of an estimated $1.8 to $3 million annually between 2015 and 2020, with health cost savings estimated at $126 to $234 million over the same period. 

In rural areas, farmers are affected by direct sunlight and extreme heat. Expanding sustainable mechanisation with skill training reduces the burden. Mechanisation alone isn't enough; without training, that burden isn't reduced; it relocates.

Implementation of the Green Economy is contingent on the Sustainable Development Goals. Every goal of SDGs is interconnected and sometimes one is complementary to another. That's why synergistic reinforcement is needed. Goal 13 specifically addresses climate action but some other SDGs are directly or indirectly concerned with Green Economy.

Yet the institutions meant to fund this transition are themselves fragile. Domestic financing alone is not enough. Bangladesh's Nationally Determined Contribution (NDC 3.0) already acknowledges the human cost of decarbonisation and sets worker reskilling as a priority. 

That language needs to be backed by international climate finance and concessional lending directed at energy infrastructure and factory retrofits.

Bangladesh Bank's Tk4 billion green refinancing program should be extended and its category needs to be narrowed to focus on solar deployment, factory cooling systems and energy efficiency retrofits. Imposing green tax on coal, LNG, and furnace oil imports would benefit in two ways: one, by generating revenue for clean energy; and two, by reducing dependence on fossil fuels. 

Rooftop gardens, green corridors and tree cover on major roads are low-cost interventions with excellent cooling effect which should've been mandatory standards, not optional beautification projects.

Bangladesh contributes less than 0.3% of global greenhouse gas emissions and did not cause this crisis. But it cannot wait for major emitters to act. The heat is already embedded in wages, workdays, and poverty rates. 

A green economy that expands clean energy, cools factories, greens cities, and protects transitioning workers is also a more resilient economy. Bangladesh has the policy architecture, the export base, and the institutional track record to move. What it needs now is speed.

Shuktara Khanom is a lecturer at Department of Economics, Southeast University

Md Farhan Mahatab Bhuiyan is a student at Department of Economics, Southeast University

Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions and views of The Business Standard.