On August 5th, former Prime Minister Sheikh Hasina resigned, and by the following day, President Mohammed Shahabuddin had dissolved parliament, forming an interim government. At first glance, this appeared to signal a step toward a democratic transition, a break from years of authoritarian rule. Yet, beneath the surface, this process lacks any legal foundation in the country’s constitution. As Bangladesh moves into this new political era, the footing seems precarious at best.

Rather than following a constitutionally sound transition anchored in the rule of law, the interim government seems to be improvising. The result has been widespread instability, reaching into Bangladesh’s legal, social, and economic systems. Political score-settling has trickled down from the Supreme Court to high school classrooms. Everyday life, along with the institutions that underpin Bangladesh’s democratic and economic aspirations, is unraveling.

For international observers, the situation is alarming. Muhammad Yunus, the interim leader, is under increasing pressure to guide the nation toward a peaceful and legitimate transition. However, his government seems to be flouting legal protocols, causing ripples destabilizing livelihoods and undermining democratic goals.

Three days after the interim government took office, a wave of student protests pressured Bangladesh’s Chief Justice and five Appellate Division judges to resign. The swiftness of these forced resignations was stunning just two hours after an ultimatum. As students gathered at the Supreme Court, so did the military, signaling a potentially dangerous dynamic between civilian unrest and military intervention.

Yunus insists that “all legal steps” were followed in forcing these resignations, but the speed and circumstances of their exit raise troubling questions about precedent. Since then, the resignations have spread like wildfire, reaching universities and secondary schools. Top administrators—from Vice Chancellors and Pro-Vice Chancellors, treasurers, registrars, provosts, proctors, and even librarians—have been ousted amid a swirl of public pressure and accusations. Dr. Mahmood Hossain, the respected Vice-Chancellor of Khulna University, resigned after facing relentless criticism, particularly on social media. He lamented, “The criticism I have faced, especially on social media, has eroded my respect.”

The interim government’s efforts to stabilize the situation have been erratic at best. Several permanent secretaries have seen their contracts abruptly canceled, while others have been pulled out of retirement to fill crucial roles. In a strikingly arbitrary move, the government has dropped criminal charges against former opposition members and lifted a ban on a political party linked to Islamic fundamentalism. Meanwhile, nearly 200,000 people have been charged as Awami League members, and journalists, editors, and broadcasters have been indiscriminately rounded up.

This growing instability is beginning to have profound economic consequences. The Foreign Investors Chamber of Commerce and Industry (FICCI) reported that Bangladesh’s economy has already lost $10 billion during weeks of turmoil, with no end in sight. In September, the violence and vandalism forced the closure of nearly 170 garment factories. Echoing the supply chain disruptions of the COVID-19 pandemic, the ongoing unrest threatens the garment industry, which accounts for 85% of Bangladesh’s $55 billion in exports. Major brands like Disney and Walmart are already looking to source goods elsewhere, a shift that could cripple the nation’s economic stability.

Bangladesh’s financial sector is also on shaky ground. On the very day the interim government took power, the Governor and four deputies of Bangladesh’s central bank were forced to resign. Their exit, accompanied by military escorts through crowds of protesters, was both dramatic and destabilizing. Protests quickly spread to other banks, and the newly appointed Governor, Dr. Ahsan H. Mansur, responded by dissolving nearly a dozen bank boards. While he claimed this was necessary to improve management, analysts worry it opens the door for major shareholders to gain undue influence.

The central bank is now in disarray, and without independent oversight, the risk of mismanagement looms large. To calm nerves, Dr. Mansur issued a nationwide plea for people to “Keep faith in us and carry out regular banking activities.” Yet, his appeal comes as he scrambles to secure $6.5 billion in loans from international institutions like the IMF, the World Bank, and the Asian Development Bank. While the IMF has expressed interest in considering the loan request, it is unlikely to act before October—and even then, the outcome is uncertain.

Despite calls for new elections within three months, the interim government has yet to announce a timeline. Key figures have admitted that they will remain in power “as long as necessary,” a declaration that only deepens the nation’s unease. Without a clear mandate from the law or the people, the interim government seems to be surviving on borrowed time, precariously balanced between competing pressures.

Yunus currently enjoys the support of Bangladesh’s youth, but this allegiance is tenuous. Should the security situation worsen or economic relief fail to materialize, this support could evaporate. If Western powers turn their attention elsewhere at this critical moment, Bangladesh’s hard-won democratic reforms could slip further away—along with the livelihoods of millions and the hope for a brighter future.