Public procurement in Bangladesh accounts for a significant share of government expenditure, yet the systems governing how contracts are awarded, monitored, and delivered remain deeply flawed. Drawing on our extensive experience working across government ministries and development programmes, this article examines the systemic challenges in procurement and tendering - and makes the case for urgent reform.
The Scale of the Problem
Bangladesh's public procurement system processes thousands of contracts annually across infrastructure, services, and goods. Whilst the Public Procurement Act of 2006 and subsequent rules established a formal framework, implementation has consistently fallen short of the legislation's intent. The gap between policy and practice has created an environment where irregularities are widespread and accountability is weak.
Development partners have long been aware of these challenges. Many have invested in procurement reform programmes, trained government officials, and supported the establishment of electronic procurement systems. Yet fundamental problems persist, suggesting that technical fixes alone are insufficient without deeper institutional and political commitment to change.
Bounty Sharing and the Tendering Ecosystem
One of the most corrosive features of the current system is the practice of "bounty sharing" - where contracts are awarded not on the basis of technical merit or value for money, but through pre-arranged agreements to distribute project funds amongst connected parties. This practice inflates costs, reduces quality, and diverts public resources from their intended purposes.
The tendering ecosystem has evolved to accommodate these practices. Ghost companies - entities that exist only on paper - submit bids to create the appearance of competition. Proxy organisations front for politically connected interests. Evaluation committees are composed of individuals with conflicts of interest. The result is a system that rewards connections over competence.
Ministry-Level Concerns
Our work across multiple government ministries has revealed specific patterns of procurement dysfunction. In infrastructure projects, cost overruns are routine and quality deficiencies become apparent within years of completion. In service contracts - including those funded by development partners - the selection of consultants and implementing organisations often reflects political considerations rather than technical capability.
Several ministry officials, speaking candidly, acknowledged that the current system undermines their own ability to deliver on policy objectives. Competent firms are often deterred from bidding, knowing that the process is unlikely to be fair. This adverse selection effect means that the government frequently ends up with less capable contractors, compounding the waste of public resources.
The Case for Merit-Based Assessment
Reforming procurement requires a fundamental shift towards merit-based assessment at every stage of the process. This means strengthening technical evaluation criteria, ensuring evaluators are qualified and independent, publishing evaluation results transparently, and establishing robust complaint and appeal mechanisms.
E-procurement systems offer a partial solution by reducing opportunities for collusion and increasing transparency. Bangladesh's e-GP system has made progress, but its effectiveness is undermined when the underlying evaluation processes remain compromised. Technology must be accompanied by institutional reform and genuine political will.
What Development Partners Can Do
Development partners have both leverage and responsibility. Conditionality around procurement standards in funded projects must be enforced, not merely stated. Supporting independent monitoring mechanisms, investing in civil society watchdog capacity, and publicly reporting on procurement performance would signal that accountability is taken seriously.
The reform of public procurement is not a niche technical issue - it is fundamental to whether Bangladesh's development trajectory benefits its citizens or enriches a connected few. Getting procurement right would unlock billions in effectively deployed public resources and send a powerful signal that Bangladesh is serious about governance reform.
