Speakers during a webinar on Saturday said local government institutions receive only around 1.0 per cent of the total fiscal budget.
They highly depend on grants and central government transfers, although Bangladesh is an urban economy with over 60 per cent of the GDP generated by its cities.
Bangladesh is among the top 10 fastest-urbanising countries, they said, but it has extremely poor infrastructure, low level of services and lack of amenities that characterise its urban areas.
Municipalities depend on central transfers for 85 per cent of development expenditures, the speakers cited.
Urban local governments in Bangladesh are characterised by limited capacities to plan, finance and deliver adequate urban infrastructure services to a rapidly growing population, they noted.
The challenge is further constrained by inefficient human resource, both in quantity and quality, that result in limited technical and managerial capacities for local level development.
The views were made during a webinar styled 'World Cities Day 2020' hosted by Centre of Excellence for Urban Development (CEUD) Foundation.
This year's theme is 'Valuing Our Communities and Cities'.
CEUD Foundation is a consortium of Municipal Association of Bangladesh (MAB), Institute of Engineers Bangladesh (IEB), Institute of Architects Bangladesh (IAB) and Bangladesh Institute of Planners (BIP). Local government minister Tazul Islam attended the programme as the chief guest.
In his speech, Mr Islam said any plan will fail if the optimum population cannot be fixed and infrastructure and other utility services be ensured accordingly.
"We're constructing high rises without considering whether we have the infrastructure and the capacity of our service-providing agencies. We must design the planning by fixing optimum population of any city."
Urban planners and experts discussed ways to bring together key stakeholders from public and private sectors to respond to emerging challenges.
They also suggested fostering cooperation to complement national efforts in ensuring sustainable urban development.
To build sustainable cities and communities, they speakers said, Bangladesh needs to better manage city planning and urban service delivery.
