Is Muhammad Yunus on the Brink of Resigning, and What Does It Mean for Bangladesh?

By MEI Analysis Team, New Delhi
24 May 2025

Bangladesh, a nation of 173 million people, is once again at a political crossroads.

Muhammad Yunus, the Nobel Peace Prize laureate and interim Chief Adviser of Bangladesh’s caretaker government, has reportedly threatened to resign, citing frustration over a lack of political consensus and mounting protests.

This development, coming just nine months after Yunus assumed power following a student-led uprising, has sparked intense speculation about the country’s future.

So, who is Yunus, why is he facing such fierce opposition, and what does this mean for Bangladesh’s fragile democratic transition?

Who is Muhammad Yunus?

Muhammad Yunus, an 84-year-old economist, is globally renowned for pioneering microcredit through the Grameen Bank, a model that empowered millions of impoverished Bangladeshis, particularly women, by providing small loans to foster entrepreneurship.

His work earned him the Nobel Peace Prize in 2006, cementing his reputation as a champion of social justice. However, Yunus’s transition from social innovator to political leader has been fraught with challenges.

In August 2024, Yunus was appointed Chief Adviser of Bangladesh’s interim government after a student-led movement ousted former Prime Minister Sheikh Hasina, whose 15-year rule had grown increasingly authoritarian.

The uprising, initially sparked by protests against a controversial job quota system, evolved into a broader demand for systemic reform, culminating in Hasina’s flight to India. Yunus, seen as a neutral and respected figure, was tasked with steering the country toward democratic elections while implementing critical reforms.

Why is Yunus Considering Resignation?

Reports suggest Yunus is contemplating resignation due to an inability to function effectively amid political gridlock.

According to sources within his office, Yunus expressed frustration, stating, “What is the point of being the chief advisor if he cannot function properly?” The interim leader reportedly feels “held hostage” by relentless protests and factional demands, which have hindered his reform agenda.

A key point of contention is the timeline for national elections. Yunus has indicated that elections could be delayed until 2026 to allow for comprehensive reforms, including restructuring the electoral system and addressing judicial abuses. However, this stance has drawn sharp criticism from political parties and the military, who argue that prolonged delays undermine democratic legitimacy.

On 21 May 2025, Bangladesh’s Army Chief, General Waker-Uz-Zaman, issued a stern warning, urging Yunus to hold elections by December 2025 to ensure an elected government is in place by early 2026. This public ultimatum, coupled with reported tensions over Yunus’s foreign policy decisions, has exacerbated the rift between the interim government and the military.

Who is the Opposition?

The opposition to Yunus is multifaceted, comprising political parties, student groups, and segments of the military, each with distinct grievances:

1. Bangladesh Nationalist Party (BNP): Led by former Prime Minister Khaleda Zia, the BNP has emerged as a vocal critic, demanding elections by December 2025. On 22 May 2025, thousands of BNP supporters protested in Dhaka, calling for a clear election roadmap and the appointment of their candidate, Ishraque Hossain, as mayor of Dhaka South City Corporation. The BNP, with the Awami League banned on 12 May 2025, sees itself as the frontrunner in any upcoming election and views Yunus’s delays as an obstacle to its political ambitions.
2. National Citizen Party (NCP): Ironically, the NCP, formed by student leaders from the 2024 uprising, including Nahid Islam, has also distanced itself from Yunus. The NCP demands fundamental reforms before elections, arguing that premature polls could perpetuate systemic flaws. However, the party has protested against Yunus’s advisers, accusing them of bias toward specific groups, further complicating his position.
3. Jamaat-e-Islami and Islamist Groups: Yunus’s decision to lift a ban on Jamaat-e-Islami, imposed by Hasina’s government, has fueled tensions. Critics argue that this move has emboldened Islamist groups, contributing to attacks on Hindu communities and raising fears of rising religious extremism.
4. The Military: The Bangladesh Army, which facilitated Hasina’s safe exit and Yunus’s appointment, is increasingly at odds with the interim government. General Waker-Uz-Zaman has expressed concerns over Yunus’s reluctance to hold elections and his controversial proposal for a humanitarian corridor to Myanmar’s Rakhine state, which some fear could draw Bangladesh into regional conflicts.

Why Does This Opposition Threaten Bangladesh?

The opposition to Yunus poses significant risks to Bangladesh’s stability and democratic transition:

1. Political Instability: The lack of consensus among political parties and the military threatens to plunge Bangladesh into further chaos. Yunus’s potential resignation could create a power vacuum, especially if no clear successor emerges. The BNP’s push for immediate elections, contrasted with the NCP’s demand for reforms, risks deepening divisions, potentially leading to more street protests and violence.
2. Military Intervention: The army’s growing frustration, revealed by General Waker-Uz-Zaman’s warnings, raises the specter of military intervention. Reports suggest the army is prepared to ensure elections, even if it means sidelining Yunus. A military-led transition could undermine the democratic aspirations of the 2024 uprising and alienate student and civil society groups.
3. Rising Extremism: Yunus’s perceived leniency toward Islamist groups like Jamaat-e-Islami has alarmed observers, particularly in light of attacks on Hindu communities. Such tensions could exacerbate communal violence, destabilizing Bangladesh and straining relations with neighboring India, which has expressed concerns over Yunus’s foreign policy tilt toward China.
4. Economic and Social Fallout: Bangladesh’s economy, heavily reliant on garment exports, is already strained by political unrest and India’s recent decision to halt transshipment facilities following Yunus’s remarks about Northeast India. Continued protests and uncertainty could further disrupt trade and investment, compounding economic challenges for ordinary Bangladeshis.

Reasons for Protests Against Yunus

The protests against Yunus stem from a combination of ideological, political, and policy-related grievances:

1. Delayed Elections: The BNP and other groups accuse Yunus of delaying elections to prolong his unelected tenure, undermining democratic principles. Protesters, including thousands who rallied in Dhaka on 22 May 2025, demand a clear timeline for polls, reflecting frustration with the interim government’s pace.
2. Perceived Authoritarianism: Human Rights Watch and local media have criticized Yunus’s administration for using “draconian” amendments to the Anti-Terrorism Act to suppress opposition voices, echoing the repressive tactics of Hasina’s regime. Reports of 640 journalists targeted in eight months have further fueled accusations of stifling dissent.
3. Controversial Policies: Yunus’s proposal for a humanitarian corridor to Rakhine, backed by the UN and reportedly the US, has been condemned by opposition parties as “unilateral and illegal.” Critics argue it risks entangling Bangladesh in Myanmar’s civil war, a move opposed by the military and political groups alike.
4. Alleged Bias in Governance: The NCP and other groups have demanded the resignation of key Yunus advisers, such as Salehuddin Ahmed (Finance) and Asif Nazrul (Law), alleging they are aligned with specific factions, undermining the government’s neutrality.
5. Public Discontent: The 2024 uprising was driven by a desire for systemic change, but many Bangladeshis feel Yunus has failed to deliver. Social media posts reflect growing disillusionment, with some labeling his resignation threats as a “political tactic” to deflect criticism.

What Happens Next?

Yunus’s potential resignation could have far-reaching consequences. If he steps down, the interim government may struggle to find a unifying figure to replace him, risking further instability. The military’s insistence on elections by December 2025 suggests a potential power shift, but premature polls without reforms could entrench existing inequalities, as warned by the NCP.

Conversely, if Yunus remains, he faces the daunting task of bridging divides between rival parties, placating the military, and addressing public demands for reform. His supporters, rallying under the “March for Yunus” planned for 24 May 2025 in Dhaka’s Shahbagh, argue that he must stay to ensure a peaceful democratic transition.

Conclusion

Muhammad Yunus, once hailed as Bangladesh’s beacon of hope, now finds himself at the center of a political storm.

His threat to resign reflects the immense challenges of governing a polarized nation with competing visions for its future.

As protests loom and tensions with the military escalate, Bangladesh stands at a critical juncture. The coming weeks will determine whether Yunus can navigate this crisis or whether the country will descend into further uncertainty, testing the resilience of its democratic aspirations.