Bangladesh, 1972–2025: A Long Arc of Political Corruption

Introduction: The shape of a system

From its birth in 1971, Bangladesh has wrestled with a governance paradox: huge aspirations attached to a fragile state, tight political competition inside shallow institutions, and a bureaucracy and party system that long pre-dated the republic. The result has been a recurrent pattern of rent-seeking, patronage, and impunity across regimes—civilian and military alike—with periodic spurts of anti-corruption campaigns that rarely outlast political expedience. Transparency International’s Corruption Perceptions Index (CPI) has placed Bangladesh near the bottom for much of the last quarter-century; in the 2024 edition, the country scored 23/100 (rank 151 of 180), underscoring how entrenched these problems remain. Transparency.org+2Transparency.org+2

1972–1975: scarcity, black markets, and a fragile new state

The early republic inherited devastation: war-torn infrastructure, low administrative capacity, and a politicised bureaucracy. Policy missteps—sweeping nationalisation, price controls, and weak enforcement—combined with patronage and leakage. In this fragile setting, a pervasive black market in food and foreign exchange flourished, lubricated by smuggling networks and political protection. Researchers tracing the 1973–74 period found evidence of large-scale illicit outflows (gold, textiles, rice and jute) and a thriving black-market rupee/taka trade that distorted incentives and starved cities and the poor of supplies. Academia+2ResearchGate+2

The 1974 famine—one of the country’s defining traumas—was not only a harvest or flood story. Scholarship highlights how governance failures, hoarding, and smuggling (often by politically connected actors) segmented markets, spiked prices, and turned a supply shock into a catastrophic entitlement failure. While natural shocks mattered, analysts emphasise official corruption and mismanagement in food import and distribution chains as key accelerants. ResearchGate+2Redalyc+2

The period also saw the rise of the Jatiyo Rakkhi Bahini (JRB), a paramilitary force criticised in contemporaneous and retrospective accounts for extra-legal coercion. Although the JRB is usually discussed in human rights terms, its impunity is intertwined with patronage and protection rackets that normalised the abuse of state power for partisan ends. Even sympathetic chroniclers of the era acknowledge that public anger at corruption among ruling elites and their associates had grown by 1975. Human Rights Watch+2countrystudies.us+2

1975–1990: coups, martial law, and the routinization of patronage

Successive military-backed regimes after August 1975 promised to “clean up” politics. In practice, they re-channelled rents rather than dismantling them. Under Ziaur Rahman (1975–81), the state pivoted to a more market-oriented stance and political pluralisation, but still leaned heavily on loyalist networks in public contracting and local administration. Research on the late 1970s notes the regime’s efforts to prosecute some corruption, yet systemic clientelism and bureaucratic capture persisted. isdsnet.com

Under Hussain Muhammad Ershad (1982–90), the civil-military-business nexus became more overt. Ershad was charged in multiple corruption cases after his fall; he was convicted in the Janata Trust/land allotment case in 2000 (sentence later reduced), while other cases ended in acquittal or lapsed—illustrating both the reality of high-level graft and the limits of accountability in a politicised judiciary. bdnews24.com+3UPI+3Wikipedia+3

1991–2006: competitive democracy, competitive rent-seeking

The 1991 return to parliamentary democracy created alternation in office—but also alternation in patronage. Throughout the 1990s and early 2000s, Bangladesh routinely sat at or near the bottom of the CPI. Household surveys conducted by Transparency International Bangladesh (TIB) documented the everyday microeconomics of corruption—bribery, speed money, and extortion—especially in law enforcement, land administration, and the judiciary. The basic pattern: citizens paid to access routine services, while political elites arbitraged public contracts, appointments, and regulatory forbearance. ti-bangladesh.org+1

The 2001–2006 period under the BNP-led alliance is widely cited for escalating politicisation and “dual power centers,” notably the rise of Hawa Bhaban as a reported nexus of influence under Tarique Rahman. Diplomatic cables and investigative reporting from the period (and later retrospectives) described large-scale rent extraction, bid-rigging, and extortion. While such accounts must always be read critically, Bangladesh’s CPI nadirs in 2001–2005 provided independent, global triangulation of perceived deterioration. Transparency.org+1

2007–2008: the emergency’s anti-corruption blitz—and its limits

The 2007 military-backed caretaker government made anti-corruption a signature agenda: the Anti-Corruption Commission (ACC) was retooled; special courts and fast-track trials proliferated; top leaders from both major parties—including Khaleda Zia and Sheikh Hasina—were charged. But rights groups noted due-process concerns and overreliance on coercive interrogation, while the institutional reforms lacked insulation from politics. Many high-profile cases later collapsed or were withdrawn after 2009, underscoring how legal campaigns absent deeper rule-of-law fixes tend to be time-bound. Human Rights Watch+2Refworld+2

2009–2014: institution-building on paper, cronyism in practice

The Anti-Corruption Commission exists by statute (2004) and was the flagship integrity institution meant to supersede the old Bureau of Anti-Corruption. In practice, observers and courts have repeatedly flagged its capacity gaps and political vulnerability, including legal amendments that required prior government permission to investigate certain officials. The signal is mixed: the architecture is present, but authority and independence have fluctuated with executive preference. FAOLEX+2unafei.or.jp+2

Large scandals marked this period. The World Bank cancelled its $1.2bn support for the Padma Bridge in 2012, citing “credible evidence” of a high-level corruption conspiracy involving senior officials and contractors. Although Canadian prosecutions of SNC-Lavalin officials ultimately collapsed, the reputational damage was severe, and Bangladesh’s own ACC exonerated domestic figures—fueling debate about selective enforcement. World Bank+1

In the state-owned banking sector, the BASIC Bank fraud (2009–2013/15) siphoned roughly Tk 4,500 crore through fraudulent loans, pointing to board-level complicity. The Hall-Mark/Sonali Bank scam (2010–2012) diverted another Tk 2,700+ crore using forged documents. These cases exposed how politically shielded directors and managers could override controls, with delayed or partial accountability years later. Scribd+3The Daily Star+3SSRN+3

2010s: megaprojects, quick rentals, and widening discretion

Beyond discrete scandals, policy choices created structural rent channels. The Quick Enhancement of Electricity and Energy Supply (Special Provisions) Act, 2010—renewed multiple times—allowed power deals to be awarded without open tender and provided sweeping indemnity. Critics labelled it an “impunity act,” arguing it legalised opacity and entrenched capacity-charge payments to politically connected Independent Power Producers, socialising risks and privatising rents. In late 2024, the High Court struck down core indemnity clauses; in 2025, the government approved repeal, but coverage until then had lasted most of the decade-and-a-half. The Business Standard+3The Daily Star+3newagebd.net+3

Investigations and commentary describe how “capacity charges” paid to idle plants ballooned subsidies and debt across the power value chain, with calls for renegotiation of contracts signed under discretionary regimes. The broader allegation is not that every plant was corrupt, but that emergency procurement powers normalised off-budget obligations and patronage-driven allocations. Business Inspection BD+1

The 2010–11 stock market boom-bust is another example of policy-driven rent creation. Regulators and banks fueled an asset bubble that collapsed in early 2011; subsequent research and press coverage framed it as a manipulation-riddled “scam” that devastated retail investors and favoured insiders who exited early. The episode echoed a smaller 1996 crash during a prior Awami League tenure, reinforcing public cynicism about “reform cycles” that never reach the powerful. Wikipedia+1

Late in the decade, a highly publicised “casino crackdown” targeted ruling-party affiliate figures, revealing how illicit gaming, tenders, and extortion had flourished under political umbrellas. Several arrestees were senior Jubo League leaders. Editorials later questioned the slow progress of prosecutions and the apparent rehabilitation of some accused, reinforcing a familiar pattern: spectacle first, system change much later—if at all. Anadolu Ajansı+1

2019–2024: centralisation, shrinking space, and offshore vectors

By the late 2010s and early 2020s, governance watchers increasingly emphasised the “centralization” of decision-making. CPI scores stagnated in the low-to-mid-20s, and TIB’s surveys continued to rank everyday interfaces—police, land, courts—as persistently corrupt. International rights groups flagged the politicisation of the ACC and selective casework: corruption cases filed amid the 2007–08 emergency against leaders of both major parties did not receive symmetric pursuit after 2009. Transparency.org+1

Cross-border asset laundering became more visible. In 2025, the UK’s National Crime Agency froze nearly £90m in London properties linked to relatives of a prominent ruling-party industrialist-politician, citing anti-corruption cooperation; the individuals denied wrongdoing and framed the actions as politically motivated. Regardless, the episode spotlighted an old regional pattern: rents earned domestically, parked abroad through layered offshore structures. The Guardian

2024–2025: an “interim” interregnum and contested reckonings

Upheavals in 2024 reshaped the landscape, with an interim authority promising integrity reforms and a series of legal revisions. Courts acquitted longtime opposition leader Khaleda Zia in a 2008 graft case, while other high-profile verdicts tied to the prior era were overturned or sent back—often amid claims that original prosecutions were politicised. Meanwhile, probes into big-ticket power deals (including cross-border contracts) and the energy procurement “impunity” framework accelerated. The politics are charged; however, the text of official court orders and credible reportage show a real, ongoing legal churn surrounding grand corruption allegations across factions. newagebd.net+4Reuters+4AP News+4

At home, the ACC’s leadership shifted again in late 2024, with public calls to reinvigorate its independence under the ACC Act, 2004. The statute’s original intent—to place complex graft beyond the reach of routine political interference—remains sound on paper; the institutional test is whether appointment processes, legal permissions, and budgetary autonomy will align with that intent. FAOLEX+1

How corruption works in practice: five persistent mechanisms

1) Party–bureaucracy collusion in procurement and licensing. From food imports (1970s) to public works, tenders have often been steered toward loyalists, with inflated prices and low-quality delivery. “Fast-track” energy procurement entrenched no-tender awards and indemnity—now partially undone by the courts. Capacity charges, opaque PPAs, and long-dated government guarantees created a classic moral hazard: private capture of public risk. ResearchGate+2The Daily Star+2

2) State banking as a patronage ATM. BASIC Bank and Sonali Bank scandals showed how political boards and managers can override risk controls, leading to massive non-performing exposures and capital holes that taxpayers later plug. Sanctions were sporadic and delayed; masterminds frequently avoided swift conviction. The Daily Star+1

3) Regulatory arbitrage and asset bubbles. The 2010–11 stock crash illustrated how permissive regulation and political pressure on banks to support markets can inflate bubbles, then socialise losses. Similar dynamics recur in land and real estate. Wikipedia+1

4) Politicised justice and selective enforcement. Anti-corruption drives have repeatedly focused on rivals, while friends are spared or cases stall. This is not unique to any one party; it is a systemic feature undermining deterrence and the rule of law. The caretaker blitz (2007–08) and post-2009 withdrawals, as well as post-2024 reversals, illustrate how cases rise and fall with political tides. Human Rights Watch+1

5) Informal taxation of citizens. TIB’s household surveys show how ordinary people pay to access policing, land records, courts, utilities, and health care, normalising “speed money” as de facto fees. This lowers trust and embeds corruption into the daily political settlement. ti-bangladesh.org

Costs: fiscal, institutional, geopolitical

Fiscal leakage and opportunity costs. Grand corruption in procurement creates direct losses; capacity charges and poorly priced PPAs impose long-term liabilities and subsidy burdens. Banking frauds consume recapitalisation funds that could have gone to health or education. The system incentivises short-term extraction over maintenance and quality. The Financial Express

Institutional erosion. When anti-corruption bodies require permission to investigate or see frequent leadership churn, investigators internalise political limits. Courts clogged with politicised graft cases cannot set clear precedents, and acquittals without fact-finding reforms signal that cases are about power, not principle. unafei.or.jp

Reputational and geopolitical consequences. Episodes like the cancellation of Padma Bridge funding damaged sovereign credibility, even though the bridge was later self-financed and built. Asset freezes abroad fuel a narrative of elite enrichment and externalise domestic governance conflicts, potentially inviting foreign legal exposure. World Bank+1

Partial corrections—and why they’ve struggled

Bangladesh does possess tools: the ACC Act (2004); public procurement rules; right-to-information legislation; an active press; and strong civil-society watchdogs. Yet four inhibitors recur: (i) the fusion of party and state undermines agency independence; (ii) legal carve-outs (like the 2010 energy act) normalised opacity; (iii) case selection maps onto political alignments; (iv) low state capacity in forensic investigation hampers complex financial cases. The High Court’s 2024 decision striking indemnity clauses in fast-track energy procurement is a notable bright spot—an institutional pushback that, if sustained, could recalibrate incentives in a rent-heavy sector. newagebd.net

What would real change require?

End legal impunity frameworks: keep the 2024 judicial rollback intact; avoid reenacting indemnities under new names. newagebd.net
Insulate the ACC: merit-based, multi-party appointment; fixed-term leadership; repeal permissions that require executive leave to investigate sitting officials. unafei.or.jp
Digitise high-rent interfaces: e-procurement, land records, police FIR registration—linked to public audit trails.
Strengthen bank governance: independent boards, real fit-and-proper tests, and prompt corrective action that bites directors and politically exposed persons (PEPs), not just mid-level staff. The Daily Star
Cross-border asset recovery: sustain cooperation with agencies like the UK NCA and deploy beneficial-ownership registries so that offshore parking is harder. The Guardian

None of these is partisan. Each is a precondition for a politics where public office stops being a gateway to private rents.

Bibliography (selected)

Transparency International. “Corruption Perceptions Index—Bangladesh profile” and CPI 2001, 2005, 2024 entries. Transparency.org+2Transparency.org+2
World Bank. “Statement on Padma Bridge” (June 29, 2012). World Bank
The Daily Star / Business Standard / academic analyses on BASIC Bank (2009–2013/15). The Daily Star+2The Business Standard+2
Bangladesh Bank / media reporting on the Hall-Mark / Sonali Bank loan fraud (2010–2012). Wikipedia+1
ICAB Journal & encyclopedia coverage of the 2010–11 stock market crash. icab.org.bd+1
New Age, The Daily Star, The Business Standard on the 2010 “Quick Enhancement”/Speedy Power Supply Act: extensions, indemnity, HC ruling (2024), repeal move (2025). The Daily Star+3newagebd.net+3newagebd.net+3
Anadolu Agency, Prothom Alo editorials on the 2019 “casino” raids and case follow-through. Anadolu Ajansı+1
UK National Crime Agency–related reporting (The Guardian) on London property freezes tied to Bangladeshi politically exposed families (2025). The Guardian
U.S. State Dept. & HRW reports on the 2007–08 emergency anti-corruption measures and due-process concerns. State Department Archive+1
ACC Act, 2004 (official text) and background on the Bureau of Anti-Corruption. FAOLEX+1
Historical/academic work on the 1974 famine’s political economy (hoarding, smuggling, governance). ResearchGate+2Redalyc+2
Literature on early smuggling and black-market dynamics (1970s). Academia+1
Coverage of HM Ershad’s convictions and acquittals (1992–2017). UPI+2Wikipedia+2
Reuters/AP on 2024–25 legal and political developments around graft cases and power contracts. Reuters+2AP News+2

Notes on sources and scope

Corruption is by nature opaque; where court convictions are absent or later reversed, credible institutional and journalistic sources still help reconstruct incentives and systemic risks. I prioritised primary legal texts, reputable international outlets, longstanding Bangladeshi dailies, and Transparency International/TIB work. Where allegations are contested, I’ve made that explicit and anchored claims to the reporting itself. FAOLEX+2World Bank+2
This history focuses on political corruption (grand and petty) and its state-society interfaces. It does not attempt to adjudicate every disputed case; rather, it shows the recurring patterns—from black markets in the 1970s to discretion in energy procurement, banking scams, and selective enforcement—that have kept Bangladesh’s CPI scores low and public trust brittle. Transparency.org