United News of Bangladesh

Bangladesh’s financial sector stands at a defining juncture at the end of the 2025, marked by cautious stabilisation efforts but weighed down by deep-rooted structural weaknesses. While policymakers point to modest macroeconomic improvements and renewed discipline, restoring confidence, reviving private investment and repairing the financial system remain formidable challenges. From a macroeconomic standpoint, 2025 was largely a year of consolidation rather than acceleration. Inflation stayed elevated for much of the year, compelling authorities to maintain a tight monetary stance. Although inflationary pressures eased slightly towards year-end, the adjustment came at the cost of slower economic activity. According to the Bangladesh Bureau of Statistics (BBS), the general point-to-point inflation rate stood at 8.29 percent in November 2025, marginally up from 8.17 percent in October. Economic growth also fell short of earlier targets, reflecting subdued domestic demand and weak private sector investment. Both the government and the central bank repeatedly argued that short-term pain was necessary to restore macroeconomic balance and credibility. The financial sector—particularly the banking system—remained the most critical pressure point throughout the year. Non-performing loans stayed stubbornly high, underscoring long-standing governance failures, weak credit appraisal and ineffective recovery mechanisms. Despite repeated reform pledges, defaulted loans continued to erode bank balance sheets, limiting their ability to extend fresh credit. Financial sector reforms showing visible progress despite challenges: Governor Defaulted loans in the country's banking sector reached 34.6 percent of all disbursed credit till June this year, the highest level since 2000, exposing the fragile state of the banking system and renewing concerns about financial governance. Defaults surge to 34.6 percent of credit as Bad loans jump Tk 3,88,573 crore while Irregularities, weak oversight fuel crisis and the State banks hold 44.6 percent defaults. For much of 2025, banks prioritised liquidity management and survival over risk-taking, further tightening credit conditions for businesses. In a major intervention, Bangladesh Bank merged five struggling Islamic banks—First Security Islami Bank, Union Bank, Global Islami Bank, Social Islami Bank and EXIM Bank—into a new state-backed entity, tentatively named Sammilito Islami Bank (United Islamic Bank). The central bank dissolved their boards, appointed administrators and injected government capital to protect depositors and restore confidence, aiming to create a unified and stronger Islamic bank by late 2025 or early 2026. Private sector credit growth remained one of the weakest indicators in 2025, falling to a four-year low of around 6.23 percent by October, well below the central bank’s target. High interest rates, political uncertainty, power shortages and weak investor confidence discouraged borrowing, stalling new investment and business expansion despite export growth. High lending rates—often 16–17 percent—combined with stricter collateral requirements, led many entrepreneurs to delay expansion or rely on internal funds. The slowdown in capital machinery imports for much of the year reflected this hesitation. However, signs of cautious recovery emerged late in the year. Letters of Credit (LCs) for capital machinery rose by about 23 percent in the first quarter of FY2025-26, following three years of decline. During the July–September 2025 quarter, LCs climbed to $471.7 million, up from $383.9 million a year earlier, driven mainly by export-oriented sectors such as textiles, supported by improving foreign exchange stability. Still, overall private investment remained subdued. Private investment as a share of GDP fell to 22.48 percent in FY2024-25, the lowest in five years, signalling waning confidence at a critical moment as Bangladesh prepares for graduation from Least Developed Country (LDC) status. Investor sentiment in 2025 was shaped not only by financial conditions but also by broader governance concerns. Businesses frequently cited policy uncertainty, administrative delays and weak contract enforcement as major deterrents. While several reform initiatives were announced, uneven implementation led many local investors to adopt a wait-and-see approach, while foreign investors remained cautious despite Bangladesh’s large market and strategic location. The capital market offered limited relief. Although there were brief rallies, overall performance failed to attract significant new investment. Volatility, governance issues and limited market depth continued to undermine the stock market’s role as a source of long-term financing. IMF team meets BNP, discusses reforms in financial, social sectors On the policy front, Bangladesh Bank emphasised stronger supervision, improved loan classification and better corporate governance. Discussions on bank consolidation and stricter fit-and-proper criteria for directors gained prominence, though scepticism persisted over whether entrenched interests would allow deep reforms to take root. Meanwhile, the government continued to rely heavily on public investment to support economic activity. Large infrastructure projects played a stabilising role amid private sector hesitation, though economists warned that excessive dependence on public spending could crowd out private investment and raise concerns over efficiency, cost overruns and debt sustainability. The external sector provided some relief. Remittance inflows remained strong, helping stabilise foreign exchange reserves, while export earnings showed resilience despite global uncertainties. Bangladesh saw strong remittance inflows in 2025, crossing $30 billion for the fiscal year (FY25) and showing significant growth in the first half of FY26 (July-Dec 2025), reaching over $15 billion with monthly figures like November's $2.89 billion and a record $3.29 billion in March, driven by a stable exchange rate and crackdowns on informal transfers, boosting the economy. In the July-November period, remittance Inflows reached approximately $13.03 billion, a significant jump from $11.13 billion the previous year. In November 2025, A robust $2.89 billion, up over 31% from November 2024 while in March 2025, a record monthly inflow of $3.29 billion. Export receipts exceeded $20 billion in the first half of FY2025-26, driven mainly by the apparel sector. For FY2024-25, total exports reached $48.28 billion, with RMG earnings at $39.34 billion. As 2025 ends, there is cautious recognition that stabilisation has been achieved, but there is broad agreement that the hardest work lies ahead. Restoring trust in financial institutions, curbing loan defaults and ensuring predictable policy implementation are essential to unlocking private investment. Without decisive reforms, growth is likely to remain below potential, limiting Bangladesh’s ability to absorb its growing labour force—especially as concessional financing and trade preferences diminish after LDC graduation. BRTA provides financial assistance to families of road crash victims in Joypurhat In that sense, 2025 may be remembered as a transitional year—highlighting both the resilience of Bangladesh’s economy and the depth of its structural weaknesses. Whether this adjustment phase evolves into a foundation for sustainable and inclusive growth will depend largely on how effectively financial sector reforms are implemented and private sector confidence is restored in the years ahead.

The Bangladesh Road Transport Authority (BRTA) has been identified as the most corruption-prone public service office in the country, according to the Citizen Perception Survey (CPS) 2025, released by the Bangladesh Bureau of Statistics (BBS). The survey found that 63.29 percent of citizens who sought services from BRTA experienced corruption. BRTA was followed by law enforcement agencies (57.96 percent) and passport offices (57.45 percent) on the corruption list. The report was unveiled on Wednesday at the BBS auditorium in Agargaon, Dhaka. According to the survey, 31.67 percent of respondents admitted to having paid bribes directly while receiving government services in the past 12 months. Read more: BRTA chairman wants to see accident-free roads The rate of bribery was significantly higher among men (38.62 percent) compared to women (22.71 percent). An overwhelming 98.48 percent of respondents reported paying bribes in cash. BBS conducted the nationwide CPS between February 6 and 23, 2025, covering 64 districts. Data were collected through interviews with 84,807 respondents aged 18 and above (39,894 men and 44,913 women) from 45,888 households across 1,920 Primary Sampling Units (PSUs). The findings show that 63.29 percent of respondents who interacted with BRTA officials admitted to paying bribes to receive services, making it the most corruption-prone government office among those surveyed, while the least bribery was recorded in government and autonomous banks and insurance offices (2.98 percent), public educational institutions (2.94 percent), and the Anti-Corruption Commission (ACC) itself, which stood at 1.99 percent. Law enforcement agencies ranked second, where 61.94 percent of service recipients said they had to pay bribes. This was followed by the passport office at 57.45 percent and the land registry (cadastre) office at 54.92 percent, highlighting persistent corruption in citizen-facing and documentation-related services. Read more: Road crashes claim 380 lives in July: BRTA More than half of the respondents also reported bribery in interactions with judges, magistrates, prosecutors and other legal officials (53.77 percent), and the land record, acquisition and settlement offices (51.40 percent). At the mid-range, bribery was reported by 44.68 percent of respondents dealing with accounts offices, while customs, excise, and VAT offices recorded 35.37 percent. Local government offices at the union parishad, pourashava, and upazila levels stood at 32.91 percent, followed by district and upazila election offices at 26.04 percent. Lower levels of bribery were reported in social security and welfare offices (19.20 percent) and public utility services such as electricity, water and gas (18.41 percent). Interactions with elected local government representatives (14.94 percent) and income tax or revenue offices (14.08 percent) showed relatively lower but still notable corruption. Bribery incidence was lowest in the district and upazila administration (11.33 percent), agricultural offices (9.07 percent), and among public healthcare providers, including doctors and nurses (8.05 percent). Only 7.91 percent reported bribery involving elected Members of Parliament. The data underscore deep-rooted governance challenges, particularly in transport, law enforcement and land-related services, where citizens’ dependence on officials continues to fuel informal payments despite ongoing reform efforts. The survey assessed progress on six indicators of Sustainable Development Goal (SDG) 16, based on citizens’ perceptions and experiences related to security, good governance, quality of public services, corruption, access to justice, and discrimination. Read more: CNG drivers block road outside BRTA prompting Mohakhali-Uttara tailback Nationally, the average household size was four members, with 81.97 percent male-headed households and 18.03 percent female-headed households. On security, 84.81 percent of citizens reported feeling safe walking alone in their neighbourhoods after sunset while the sense of safety was lower among women (80.67 percent) compared to men (89.53 percent). The feeling of safety inside one’s home after dark was higher at 92.54 percent. In terms of governance, only 27.24 percent of citizens believed they could influence government decisions, while this figure dropped to 21.99 percent regarding political decision-making. Nationally, about 24.62 percent of respondents felt that the country’s political system is inclusive and responsive, with little difference between rural (24.47 percent) and urban (24.91 percent) areas. Regarding public service delivery over the past year, 47.12 percent of respondents accessed government health services, while 40.93 percent reported that at least one of their children attended a government primary or secondary school. Besides, 73.77 percent sought other government services such as identity cards or civil registration. Satisfaction levels varied across services: 72.69 percent for healthcare, 81.56 percent for primary education, 78.18 percent for secondary education, and 66.91 percent for other government services. The survey also found that 16.16 percent of citizens experienced disputes or conflicts in the past two years. Among them, 83.60 percent had access to some form of dispute resolution, either formal (such as courts) or informal (such as community leaders). Of these, 41.34 percent used formal institutions, while 68.96 percent relied on informal mechanisms. On discrimination, 19.31 percent of respondents reported experiencing some form of discrimination. Read more: BRTA provides financial assistance to families of road crash victims in Joypurhat The main bases were socio-economic status (6.82 percent) and gender (4.47 percent). Incidents occurred most frequently within families (49.72 percent), in public transport or open spaces (34.82 percent), and at workplaces (24.85 percent). Only 5.37 percent of victims reported such incidents to the authorities.

An Independent Taskforce on Strengthening Bangladesh Bureau of Statistics (BBS) on Monday recommended reforms to transform the agency into a modern and trusted national statistical organization and rebranding it as Statistics Bangladesh (StatBD). The Taskforce, chaired by Executive Chairman of the Power and Participation Research Centre (PPRC) Dr. Hossain Zillur Rahman formally submitted its report to the Planning Adviser Dr Wahiduddin Mahmud at his office. The Taskforce has proposed elevating the head of StatBD to the position of Chief Statistician, a Special Scale post, to underscore independence and professionalism. It also recommended creating the Trust and Transparency Council of Statistics (TTCS) — a seven-member body chaired by the Planning Adviser. This high-level council would provide institutional oversight, review annual performance and expenditure audits, and oversee the selection of the Chief Statistician. The Taskforce also suggested amendments to the Statistics Act 2013 to guarantee StatBD’s autonomy in technical matters such as data validation and release and thereby insulating official statistics from administrative or political interference. MJF applauds BBS recognition of women's unpaid work at GDP’s 18.9% To address chronic staffing shortages and structural weaknesses, the report recommended expanding the organisational structure from eight to sixteen wings, creating 437 new Upazila-level posts to strengthen local presence and unifying cadre and non-cadre services. On the financial front, the report prioritises budgetary independence, calling for dedicated revenue funding for core surveys and an immediate Tk. 50 crore allocation to stabilise annual survey operations. To rebuild public confidence, the Taskforce has advocated for an open data and release policy that ensures pre-announced data release calendars, simultaneous access for all users and publication of full metadata and methodological notes. It also proposed holding an Annual Stakeholder Conference to strengthen dialogue among statisticians, policymakers, civil society and the private sector. Advisory committees for major surveys and internship opportunities for young professionals would help make statistical outputs more relevant and credible, it said. The report emphasises capacity building through the transformation of the current training centre into a StatBD Training Academy. The academy would offer structured courses for new recruits, mid-career professionals, and senior management. Bangladesh's food security at risk as farmland shrinks by 3.75 percent in 8 Years: BBS Survey It also recommends establishing a Methodological Advisory Council to ensure standardisation across surveys and harmonize data produced by different agencies. The Taskforce urged the immediate formation of a Recommendation Implementation Task Team chaired by the Planning Adviser to guide phased reforms in the short and medium term. Transforming BBS into StatBD is not just an institutional reform but a trust-building exercise for the nation’s data ecosystem, the Taskforce noted, stressing that credible, independent, and timely statistics are vital for policymaking and public accountability.

The Bangladesh Bureau of Statistics (BBS) and the United Nations Development Programme (UNDP) Bangladesh on Sunday jointly hosted a national consultation in Dhaka to chart a roadmap for building a robust Research and Development (R&D) Cell within the BBS. Titled “Strengthening the BBS R&D Cell: Priorities for Excellence in Data and Research”, the event was supported by the Embassy of Switzerland and drew participation from over 100 stakeholders representing the government, academia, private sector, and development partners. The initiative aims to transform the proposed R&D Cell into a centre of excellence that fosters innovation, boosts statistical capacity, and promotes evidence-based policymaking in Bangladesh, said a press release. Aleya Akter, Secretary of the Statistics and Informatics Division, described the R&D Cell as a “timely and strategic investment,” underscoring the need to engage young researchers and align with global best practices. Mizanur Rahman, Deputy Director of BBS, said the Cell would enhance methodological integrity and adopt technologies like artificial intelligence to meet the growing demand for quality data at both national and international levels. Road Safety Act urged to protect pedestrians, cyclists UNDP Senior Economic Adviser Owais Parray stressed the importance of innovation, saying, “The Cell must become the engine of innovation—testing new tools and ensuring national statistics remain relevant in a rapidly changing world.” Highlighting the need for inclusive and timely data, UNDP’s Assistant Resident Representative Anowarul Haq called for stronger multi-stakeholder collaboration to realise the Cell’s full potential. In his concluding remarks, BBS Director General Mohammed Mizanur Rahman reaffirmed the agency’s commitment to establishing a future-ready R&D Cell grounded in strong partnerships. The consultation emphasised capacity building, inclusive data methodologies, and strategic collaboration as essential elements in modernising Bangladesh’s statistical ecosystem.

Bangladesh’s general point-to-point inflation rate rose slightly to 9.35 percent in March 2025, up from 9.32 percent in February, according to the latest data released by the Bangladesh Bureau of Statistics (BBS). The slight increase was mainly attributed to a rise in non-food inflation, while food inflation showed a decline. In March, food inflation fell to 8.93 percent from 9.24 percent in February, while non-food inflation edged up to 9.70 percent from 9.38 percent the previous month. The data also revealed differing trends between rural and urban areas. In rural regions, point-to-point inflation dropped to 9.41 percent in March from 9.51 percent in February. Rural food inflation declined to 8.81 percent from 9.15 percent, though non-food inflation rose slightly to 9.97 percent from 9.85 percent. Paul Krugman slams US tariffs on Bangladeshi clothing Urban areas experienced an uptick in overall inflation, rising to 9.66 percent in March from 9.34 percent in February. Urban food inflation declined to 9.18 percent from 9.47 percent, but non-food inflation climbed to 9.95 percent from 9.27 percent. The 12-month moving average inflation rate from April 2024 to March 2025 stood at 10.26 percent, up from 9.69 percent during the same period a year earlier. The wage rate index in March was recorded at 8.15 percent, compared to 8.12 percent in February.

Bangladesh’s GDP growth has sharply declined in the fourth quarter (April-June) of the last financial year 2023-24, according to the Bangladesh Bureau of Statistics (BBS). The growth was 3.91 per cent, which was 6.88 per cent in the last quarter of the fiscal year 2022-23. The BBS released the information on Monday. NBR focuses on boosting low tax-to-GDP ratio as major business figures come under scrutiny As per the data, the growth in the last quarter of the last financial year has been lower compared to the last quarter of the 2022-23 fiscal year. According to the calculation of the 4th quarter of the financial year 2023-24, the GDP size at current prices is Tk 13,783,612 million (Tk 13,784 billion) while in the 4th quarter of the financial year 2022-23 it was Tk 12,160,736 million (Tk 12,161 billion). On the point-to-point basis at constant prices, the growth in the 4th quarter of FY2023-24 was 3.91 percent as against 6.88 percent in the 4th quarter of FY2022-23. The growth in the first three quarters of FY 2022-23 was 6.25 percent, 7.05 percent and 3.02 percent respectively which in FY 2023-24 stood at 6.04 percent, 4.78 percent and 5.42 percent respectively. Employment generation takes priority over GDP growth: Planning Adviser Wahiduddin Agriculture Sector: On a point-to-point basis at constant prices, the agriculture sector grew by 5.27 percent in the 4th quarter of FY2023-24, as against 6.55 per cent in the 4th quarter of FY2022-23. In the first three quarters of FY 2022-23, the growth of this sector was 0.22 percent, 3.83 percent and 1.92 percent respectively which stood at 0.35 percent, 4.08 percent and 5.16 percent in FY 2023-24 respectively. Industrial Sector: On a point-to-point basis at constant prices, the industry sector grew at 3.98 percent in the 4th quarter of FY2023-24, as against 10.16 percent in the 4th quarter of FY2022-23. In the first three quarters of the financial year 2022-23 the growth of this sector was 5.80 percent, 10.55 percent and 6.91 percent respectively which in FY 2023-24 stood at 8.22 percent, 2.91 percent and 6.25 percent respectively. Services Sector: On a point-to-point basis at constant prices, the service sector grew by 3.67 percent in the 4th quarter of FY2023-24, compared to 4.82 percent in the 4th quarter of FY2022-23. In the first three quarters of the financial year 2022-23 the growth of this sector was 9.43 percent, 6.37 percent and 1.45 Percent respectively which in FY 2023-24 stood at 5.07 percent, 5.78 percent and 3.81 percent respectively.

The interim government of Bangladesh is moving to establish a comprehensive 'Statistics Policy' to address longstanding concerns about inaccuracies in data published by the Bangladesh Bureau of Statistics (BBS). This initiative follows widespread allegations that the BBS had provided misleading economic data under the previous Awami League government. During the Awami League's tenure, the BBS was repeatedly accused of inflating GDP growth figures while downplaying inflation, raising serious doubts about the credibility of the country’s official statistics. Interim Government committed to curbing essential commodity prices by breaking syndicates: Mahfuj Alam “We are working to formulate a Statistics Policy, which will soon be approved by the Advisory Council,” said Planning Adviser Dr. Wahiduddin Mahmud at a recent press briefing following an ECNEC (Executive Committee of the National Economic Council) meeting. He emphasized the need for a clear, unified approach to ensure the accuracy and integrity of national data. BBS Under Scrutiny The BBS, which operates under the Ministry of Planning, faced consistent criticism for its inability to provide reliable data. Their capacity is not as strong as statistical institutions in other developing countries, Dr. Wahiduddin said. He pointed out that political pressure had influenced the BBS's economic data, particularly during periods of economic growth and inflation reporting. Sources within the Planning Commission and BBS confirmed that the agency struggles with capacity issues, making it difficult to collect and analyze accurate data. Furthermore, political interference has been a significant obstacle, particularly concerning key economic indicators such as GDP and inflation. Acknowledging these challenges, Dr. Wahiduddin reiterated his commitment to maintaining the independence of the BBS. “I have already informed them that I will not intervene in their reports, regardless of any shortcomings. The data, whether high or low, must stand on its own merit,” he said. NBR focuses on boosting low tax-to-GDP ratio as major business figures come under scrutiny Strengthening the BBS’s Capacity Dr. Wahiduddin, a well-known economist, has stressed the importance of empowering the BBS as an independent entity. He aims to enhance its ability to provide unbiased and accurate data without external interference. Discussions with officials from both the Planning Commission and BBS indicate a strong focus on capacity-building initiatives to improve the bureau's performance. The BBS is currently the sole national statistical office in Bangladesh, responsible for generating and publishing critical data on population, agriculture, industry, and the broader economy. However, under past administrations, its activities were often governed by orders and circulars, lacking a cohesive policy framework. Future Reforms The BBS gained legal grounding through the passage of the 'Statistics Act' on February 27, 2013, which formally outlined its responsibilities. According to this law, the bureau is tasked with producing accurate and timely statistics, conducting national censuses, and delivering data that meets the needs of policymakers, researchers, and other stakeholders. However, the policy aims to modernize these functions and address gaps in the existing system. Among the bureau’s future tasks will be updating the National Strategy for the Development of Statistics, standardizing statistical programs to international standards, and implementing a National Data Bank. The implementation of the Statistics Policy is expected to mark a significant step toward bolstering the integrity of Bangladesh’s statistical system, ensuring that data-driven decisions can be made with confidence. Inflation decreases by 1.17 % in August: BBS

The overall inflation decreased by 1.17 percent in August compared to last July, according to a report published by the Bangladesh Bureau of Statistics (BBS) on Sunday. According to BBS, the overall inflation was 11.66 percent in July, which declined to 10.49 percent in August. Besides, food inflation declined to 11.36 percent in August, from 14.10 percent in July. However, non-food sector inflation rose slightly. Inflation in this sector stood at 9.68 percent in July, which increased slightly to 9.74 percent in August. Inflation rate in Bangladesh eases to 9.92% in Sept   In July, inflation reached its highest level in the last 13 years, with overall inflation crossing double digits during the student quota reform movement. The overall inflation rose to 11.66 percent that month, compared to 9.72 percent in June. Similarly, food inflation reached 14 percent in July, the highest in the past 13 years. The previous peak was in April 2011, when food inflation was at 14.36 percent. Since then, food inflation has not surpassed 14 percent.

The average life expectancy and birth rate in the country have declined in a span of a year. Bangladesh Bureau of Statistics (BBS) revealed this on Sunday in a report titled ‘Bangladesh Sample Vital Statistics-2023’. According to the BBS report, life expectancy at birth in 2023 has decreased statistically, to 72.3 years, which was 72.4 years in 2022. On the other hand, the population growth rate has decreased in a span of a year. The general growth rate of the population in 2023 is 1.33 percent which was 1.40 percent in 2022. 'Joyee 360': IPDC launches sub-branch in Dhaka’s Mirpur for women entrepreneurs The BBS survey revealed that among the top ten causes of death, the first cause of death is cardiac arrest at 1.027 percent and the second cause at 0.64 percent was cerebral brain hemorrhage. The average age at first marriage for men is 24.2 years and for women 18.4 years. In terms of internal migration, the rural arrival rate is 20.4 and the urban arrival rate is 43.4 per thousand population. In addition, the number of young populations not in education, work or training decreased to 39.88 percent in 2023 compared to 40.67 percent in 2022. The mobile phone user population aged 5 plus increased to 59.9 percent in 2023. However, for 15plus-year-olds, the rate has slightly increased to 74.2 percent compared to 73.8 percent in 2022. 50.1% of Internet users aged 15 plus in 2023. The sex ratio is slightly downward in 2023 standing at 96.37 percent, and the dependency ratio is 53.73 percent. The population density is 1,179 persons per square kilometer. The gross birth rate per thousand population was 19.4 in 2023, which was 19.8 in 2022. At that time (2023), the obesity mortality rate per thousand population was 6.1, which was 5.8 in 2022. The under-five mortality rate is 33 per thousand and the maternal mortality ratio is 136 per 100,000 live births, compared to 153 in 2022. Bangladesh among 30 countries with the highest purchasing power parity in the world The number of birth control users in 2023 decreased slightly to 62.1 percent in 2023 compared to 63.3 percent in 2022. Unmet demand for birth control decreased to 15.57 percent in 2023 compared to 16.62 percent in 2022. Household size remained unchanged in 2023 as in 2022 at 4.2. However, the rate of female household heads increased in 2023 compared to 2022. It was 17.4 percent in 2022, which increased to 18.9 percent in 2023. On the other hand, male household head was 82.6 percent in 2022, the rate decreased to 81.17 percent in 2023.

The government of Bangladesh is hoping to return the economy to its pre-COVID growth momentum by the end of the current fiscal (2023-24), although that presents a significant challenge in the face of a clutch of economic headwinds. The government’s vision for economic recovery is outlined in the "Medium Term Macroeconomic Policy Statement 2023-24 to 2025-26," prepared by the Macroeconomy Wing of the Finance Division, under the Finance Ministry. It maintains that with the onset of the pandemic in 2020, the economy was knocked off its fast-paced growth trajectory for large parts of the last three years. The first confirmed cases of Covid-19 in Bangladesh were reported in March 2020, less than three months after the outbreak in Wuhan. Recently published quarterly GDP data (in keeping with a condition set by the IMF) bears this out. It reveals that the economy contracted by a massive 7.86 percent in the last quarter of the 2019-20 fiscal (April to June 2020), as the virus spread throughout the globe. Read more: Financing, technology and innovation needed for just transition to greener economy: Shahriar Alam According to the quarterly data released retrospectively by the Bureau of Statistics (BBS) last month, GDP had grown by between 6.5 to 8 percent in the first three quarters of 2019-20. That reflects the extent to which the wind was knocked out of the economy by the negative growth (contraction) in the fourth quarter. The slump induced by Covid would keep economic performance depressed through the first two quarters of the next fiscal (2020-21). It wasn’t until the 3Q (January to March, 2021) that the first signs of a recovery would become visible. As the 2021-22 fiscal kicked in, Bangladesh looked ready to put Covid-19 behind it, having implemented a successful vaccination programme and lifted lockdown restrictions. The economy rallied robustly, and GDP growth touched 10 percent in the third quarter (January to March 2022). Yet even as the recovery was underway, the seeds for it to stumble were sown halfway across the globe, with Russia going to war in Ukraine in February 2022. The resulting volatility in international energy markets and supply chain disruptions would knock the momentum out again, of the country’s post-Covid recovery. Read more: World Bank forecasts Sri Lankan economy to grow by 1.7% in 2024 Although there was nothing like the contraction precipitated by Covid-19, the economy did experience a severe slowdown in the last quarter of FY22, slipping to just 2.6 percent from the previous quarter’s high of 10 percent. “Bangladesh also braced for impacts on its economy. However, actual data shows that Bangladesh did impressively even during the height of the Covid-19 outbreak and is expected to return to pre-Covid growth trajectory by the end of FY 2023-24,” the statement surmises. If everything goes according to plan and ‘assumptions hold’, it says that 8 percent GDP growth rate can be attained again in 2025-26. “Therefore, the deviation of the actual from the planned growth envisaged in the 8th FYP (Five Year Plan) remained small,” it said. Read more: Bangladesh economy hit hard by Ukraine war The Macroeconomic Policy Statement mentions capital accumulation is key for development and hence the government aims to foster private investment along with public investment towards fulfilment of its goals.. Total investment in FY 2021-22 stood at 32 percent of GDP in which the contribution of the private and the public sectors were 24.5 and 7.5 percent, respectively. To achieve the long and medium-term growth targets, the level of investment will need to be increased further. The statement points out that there is room to increase the implementation rate of public investment. If the pace of implementation of development projects can be increased, the required level of investment can be attained. “Recognising this, the government has taken steps to bring about some structural changes in both project design and implementation levels,” it says in the statement. Read more: BGMEA-Circle Economy ink MoU to accelerate garment, textile sector’s transition towards circular economy The Finance Division document said that the Russia-Ukraine war has put global energy supplies at risk. Russia is a major global supplier of energy and hence when the war broke out, commodity prices spiked fast. Bangladesh started to suffer from this like almost all other countries. By December 2022, point-to-point inflation rose to 8.7 percent and then further rose to 9.3 percent by March 2023. However, global commodity prices are already falling, and central banks have raised policy rates and because of this it is expected that inflation will come down in the coming months. The IMF has projected that the measures taken by the governments will help reduce inflation in the medium-term. The Finance Division has projected that average inflation will fall significantly to 6.0 percent in 2023-24, although there has been no indication of it through the first quarter (July to September). Read more: Bangladesh Budget 2023-24 passed in parliament In order to tame inflation and protect the incomes of the poor, the government has emphasised increasing the domestic production of essential items, while gradually tightening monetary policy. The document says that food inflation hurts the poor the most. Keeping this in mind, the government through various measures, including subsidies and incentives, encouraged the growth of agricultural output. To support the agriculture sector, disbursement of credit to the sector has been increased. By the end of February 2023, the disbursement of agricultural credit and non-farm rural credit amounted to Tk. 210.66 billion in the first 8 months of the last fiscal, which was almost 14 percent higher, year on year. Read more: Why inflation persists at a higher level in Bangladesh With the help of supportive policies of the government, the general index of industrial production (medium and large-scale manufacturing) has been on the rise, reflecting expanded industrial production. Dr Masrur Reaz, a prominent economist and public policy analyst, believes it would be very challenging to regain the pre-Covid momentum within the current fiscal, since a number of macroeconomic indicators have become unstable. Talking to UNB, he suggested the government focus on stabilising the macroeconomic situation first, which would make the economy more sustainable in the long run. Dr Reaz pointed out that high inflation, severe foreign exchange/dollar crisis preventing, among other things, opening of LCs, and the fluctuating value of domestic currency taka, should be resolved first. Read more: Businesses should get opportunities to turn around before wholesale declaration of loan defaulters: FBCCI President “To bring the economy back to its pre-Covid growth rate, these issues should be resolved first, which itself would be very challenging and difficult in a short time,” he opined. Explaining further, Dr Reaz said: “The time is to stabilise the economy rather than focus on growth. In the long run, the economy will grow through reducing the high rate of non-performing loans, keeping inflation within reasonable limits and achieving exchange rate stability.”