This paper examines the ongoing process of structural change in Bangladesh from the lens of agricultural productivity and rural development, emphasizing the need to adapt and diversify its economy preceding and following its graduation from least developed country (LDC) status. We present the case to modernize, diversify and upgrade Bangladesh’s secondary agri-food sector to continue its structural transition, production and exports, thereby further raising incomes and reducing poverty, particularly in the rural non-farm economy. The development of and productivity gains in the fish aquaculture sub-sector illustrates the secondary agri-food sector’s productive capacity and potential. The article demonstrates that the prospects for structural change in the agricultural processing sector remain promising, and that there is a need to expand agricultural value chains into value-added, secondary processing, agri-food, and high-value products.