The Ministry of Local Government, Rural Development and Co-operatives has long been controlled by influential figures or politicians from whichever party was in power. From cities to villages, the ministry oversees a wide range of projects—big and small. These projects have frequently been mired in serious allegations of large-scale embezzlement. There are also recurring accusations against ruling party members of using political influence to secure contracts and benefits. The interim government, which took over through a mass uprising, appears to be following the same path. Allegations have surfaced that those currently in charge are also enjoying undue benefits from development projects initiated during the Awami League’s time in office.

From 2009 to 2024, Sheikh Hasina’s government remained in power for 16 consecutive years. In the first term, in 2009, the Ministry of Local Government, Rural Development and Co-operatives was led by then acting General Secretary of the Awami League, Sayed Ashraful Islam. The then Joint General Secretary of the party, Jahangir Kabir Nanok, served as State Minister. After returning to power for a second term in 2015, the ministry was handed over to Khandaker Mosharraf Hossain, a former presidium member and Sheikh Hasina’s former in-law. The last minister to lead the ministry was Tajul Islam, known for being a trusted confidant of the previous head of government. Earlier, from 1996 to 2001, the ministry was headed by Zillur Rahman, who was then the General Secretary of the Awami League.

It was not just during Awami League’s tenure that close allies of the Prime Minister held the ministry. This pattern was common across all governments. During the BNP era as well, the ministry was led by key party figures. After the party came to power in 2001, the responsibility of this critical office was given to then Secretary General Abdul Mannan Bhuiyan. Before that, from 1991 to 1996, the ministry was led by BNP’s then Secretary General Abdus Salam Talukdar.

After the fall of the Awami League government in August last year, A F Hassan Ariff, an Adviser to the interim government, was assigned to the Ministry of Local Government, Rural Development and Co-operatives. Following his death, the role was given to Asif Mahmud Shojib Bhuiyan, a key figure in the anti-Sheikh Hasina movement, who is now continuing the same projects initiated by former Minister Tajul Islam.

Analysts say the interim government is operating with the previous administration’s budget and Annual Development Program (ADP), despite the need for a thorough policy review, adjustment, and restructuring. They also suggest that projects inherited from the former government should have been revised or replaced. Additionally, they stress the need to reduce the number of projects in the ADP so that work with higher priority can be carried out effectively.

Speaking to Bonik Barta on the matter, Dr. Debapriya Bhattacharya, a Distinguished Fellow at the Centre for Policy Dialogue (CPD), said, “The current interim government is continuing with the previous government's overvalued and unnecessary projects. I understand that it’s difficult to halt many of these midway, but they could have been reorganized. And even the limited changes that have been made don’t seem to follow any clear or transparent policy. Just as we saw distortions in budget allocation, we’ll likely see the same in implementation. So, the intended beneficiaries won’t truly gain from it.”

Pointing out that many of the people involved in designing those previous projects are still in charge, the economist said, “The real problem is that we remain stuck in the old structure. Moreover, those who were behind these projects are still holding on to power. Not just administratively—those who were financially and professionally involved in these projects, both inside and outside the system, are still connected to them. So I don’t see any room for deviation from the old ways.”

Allegations of irregularities and corruption against the two key divisions under the Ministry of Local Government, Rural Development and Co-operatives have long existed. These allegations often center around the projects implemented under this ministry. When the current interim government took office in August last year, there were high hopes that it would take action against the corruption-ridden projects initiated by the previous regime. But in reality, such expectations have hardly been met. The interim government is now carrying forward many of the same projects launched during the former administration’s time.

Most of the projects included under this ministry in the Annual Development Program (ADP) for the current 2024–25 fiscal year—originally drafted under the Awami League government—have also been retained in the Revised ADP (RADP). In some cases, the allocation for these projects has even increased.

According to data from the Planning Division, the original ADP for FY 2024–25 allocated BDT 179.86 billion for 102 projects under the local government and rural development sectors. Of this, BDT 134.92 billion came from government funding (GoB), while BDT 44.94 billion came from project loans or grants. In the RADP, the number of projects has increased to 112. Despite the rise in project count, the total allocation has slightly decreased to BDT 169.09 billion. Of that, BDT 135.52 billion is from GoB and BDT 33.57 billion from loans or grants.

Compared to the original ADP, the Revised ADP (RADP) for FY 2024–25 includes 10 additional projects under the local government and rural development sectors. These include the third phase of Union Parishad Complex construction, rural infrastructure development in districts of greater Rangpur, rural infrastructure development in Pirojpur and Jhalokathi, beautification along the banks of the Bhairab River in Digholia, Khulna, and rural infrastructure development in Rajshahi, Natore, and Chapainawabganj. Other new entries are infrastructure development in Munshiganj, the Host and FDMN Enhancement of Lives through Infrastructure Improvement Project (HELP), the second phase of the PBDF expansion, and the second phase of sustainable social services in the Chattogram Hill Tracts. Aside from these additions, nearly all previously included ADP projects have been retained in the RADP.

In the original ADP for FY 2024–25, the five largest projects under this sector by allocation were:

• Program for Supporting Rural Bridges (first revision) – BDT 9.53 billion
• Ashrayan-2 project (fifth revision) – BDT 8.84 billion
• Rural Connectivity Improvement Project (first revision) – BDT 7.25 billion
• Cyclone Amphan & Flood Damage Rural Infrastructure Rehabilitation Project (first revision) – BDT 7 billion
• Important Rural Infrastructure Development Project on Priority Basis-3 (first revision) – BDT 6.75 billion

In the RADP, the highest allocation—BDT 12.6 billion—has gone to the Important Rural Infrastructure Development Project on Priority Basis-3 (first revision), nearly double its ADP allocation. The Program for Supporting Rural Bridges maintained its original allocation of BDT 9.53 billion. The Cyclone Amphan and flood-affected rural road rehabilitation project saw an increase from BDT 7 billion in the ADP to BDT 8 billion in the RADP. The Rural Connectivity Improvement Project was allocated BDT 8 billion in the RADP, up from BDT 7.25 billion in the ADP. Meanwhile, the allocation for the Construction important bridges on rural roads (first revision) rose from BDT 3.5 billion to BDT 6 billion. The Mymensingh Region Rural Infrastructure Development Project (first revision) received BDT 4.45 billion in the RADP, compared to BDT 2.5 billion in the ADP.

Dr. Zahid Hussain, former Lead Economist at the World Bank’s Dhaka office, told Bonik Barta that unless the government can revise or replace inherited projects, the status quo will continue. “Although the Padma Bridge was a political project, it has added value to the economy. In contrast, a major criticism of projects under the local government and rural development sector is that the money spent has not contributed to creating any real assets. This sector is often seen as one where public funds are essentially thrown into a pond. In these projects, there tends to be a high level of waste, projects often remain incomplete, contractor groups hold significant influence, and factors like local political and bureaucratic interference play a major role,” he said.

Pointing out that these projects have remained in place even after a change in government, he said, “These projects involve ministry-level engagement, which means the bureaucracy has a vested interest. Additionally, certain interest groups emerge at the local level. So, it’s not easy for a new government to simply come in and change everything. However, since most projects in this sector are small and short-term, there was room to scale them down. If strong directives come from the top and the inertia is overcome, change is possible. Leadership plays a key role here. My recommendation would be to reduce the number of projects in the ADP so that ministries can focus on higher-priority tasks.”

Last month, Asif Mahmud Shojib Bhuiyan, Adviser to the Ministry of Local Government, Rural Development and Co-operatives, acknowledged that most of the citizen complaints he received were related to corruption and irregularities in his ministry. One notable allegation involves his former Assistant Private Secretary (APS), Md Moazzem Hossain. According to the Anti-Corruption Commission (ACC), Moazzem is accused of abusing power for lobbying, manipulating tenders, and amassing illicit wealth worth hundreds of millions of taka. The ACC has already questioned him and blocked his national ID to prevent overseas travel.

When asked about the overall situation, LGRD and Co-operatives Adviser Asif Mahmud Shojib Bhuiyan told Bonik Barta, “In the revised ADP, we have reduced our budget by nearly BDT 90 billion. Projects that were taken up based on political considerations have been canceled. However, for those that involve foreign assistance, making changes requires a long-term process of revising the DPP. In 2017, 2018, and even in 2020, we received foreign aid commitments for many projects. As time passed, we saw that interest rates on those loans began to rise, and there are also penalty issues involved. That’s why we have not made any changes to projects funded by foreign assistance. Instead, we are reviewing GoB-funded projects that contain political components and are amending their DPPs. More than half of our projects have had their DPPs revised, and this process is still ongoing.”

However, while the Adviser claimed that the revised ADP slashed BDT 90 billion from the local government and rural development budget compared to the original allocation for FY 2024–25, data from the Planning Division shows that the actual reduction is BDT 10.77 billion.

Additionally, under this sector, two projects under the Prime Minister’s Office (PMO) initially had BDT 11.04 billion allocated from GoB funds in the ADP, which was reduced to BDT 3.70 billion in the RADP. Moreover, several projects initiated by the previous government not only retained foreign assistance in the revised ADP but also received fresh allocations from GoB funds.