WB forecasts 3.3pc GDP growth for Bangladesh

The World Bank has slashed Bangladesh's economic growth projection to 3.3 percent in the current fiscal year 2024-25, down from its previous forecast of 4 percent as the country's economy continues to reel from political turmoil following a change in government.

Between 2010 and the Covid-19 outbreak, Bangladesh consistently posted growth above 6 percent. Even during the pandemic and the period that followed, growth remained above 5 percent.

The World Bank had earlier predicted 4 percent growth in October, but now cites a combination of political instability and economic disruption during the July-August anti-government movement as key reasons behind the revision.

The global lender, in its latest South Asia Development Update, also warned the 12-month average inflation in the country to hit 10% in FY25. "This primarily reflects the disruptions arising from last summer's social unrest and political tensions. It also reflects the trade disruptions, the persistence of inflation, worsening bank health, governance challenges, and general uncertainty about the country's political future, all of which will contribute to an expected decline in investment."

In a previous update on Apr 9, the Asian Development Bank (ADB) forecast 3.9 percent growth for the current year, down from its earlier estimate of 5.1 percent in September.

The report shows the growth outlook has been scaled back not just for Bangladesh but for the entire region.

According to the World Bank, South Asia's economy grew by 6 percent in 2024, which is 0.4 percentage points lower than the projection made last October.