Dr. Islam did M.A. in Economics from Dhaka University, M.A. in Development Economics from Williams College, USA and Ph.D. in Economics from Boston University, USA.
He began his professional career as a Lecturer in the Department of Economics, Dhaka University in 1962. He then joined the Civil Service of Pakistan (CSP) in 1964. He has held a number of positions in the Governments of the then East and West Pakistan and later in the Government of Bangladesh. These include Director, West Pakistan Agricultural Development Corporation; Deputy Secretary, Ministry of Finance, Government of Bangladesh; Deputy Commissioner, Mymensingh and Joint Secretary/ Additional Secretary, Ministry of Establishment, Government of Bangladesh.Dr. Islam joined the United Nations in 1982 and served in Bangkok and New York. He was Economic Affairs Officer/ Senior Economic Affairs Officer of the United Nations Economic and Social Commission for Asia and Pacific, (UNESCAP) Bangkok (1982-1987); Chief, Developing Economies Section, United Nations Centre on Transnational Corporations, New York, (1987-1992) and Director, Development Research Policy Analysis Division, UNESCAP, Bangkok (1993-2001). He was Chairman, Securities and Exchange Commission (2002-2005); Chairman, Board of Directors of Sonali Bank (2006); and Adviser to the Caretaker Government, Ministries of Finance and Planning (2007-2008). Dr. Islam taught Economics in Boston University, Boston, USA; East-West University, Dhaka and Bangladesh Civil Service College, Dhaka. He has been a consultant to UNESCAP, UN. Conference on Trade and Development (UNCTAD) and the World Bank.  Dr. Islam is presently a Visiting Professor in BRAC University.