ADB slashes Bangladesh’s growth forecast to 5.1% for FY 2024-25

The Asian Development Bank (ADB) has slashed its economic growth forecast for Bangladesh to 5.1 percent for the fiscal year 2024-25, citing political unrest, supply chain disruptions, and recent severe floods.

This marks a significant downgrade from the 6.6 percent growth the Manila-based lender had projected earlier for the same period.

The political turmoil in July and August, marked by mass agitation, along with the flooding, has severely impacted Bangladesh’s Gross Domestic Product (GDP), disrupting the production of goods and services across the country, reports UNB.

In its latest report, the ADB warned that fiscal and monetary policies are expected to remain tight, which could further reduce consumption demand and keep inflation high.

The bank cautioned that its forecast carries significant uncertainty, with downside risks overshadowing the macroeconomic outlook.

The ADB identified these risks as being primarily driven by ongoing political instability, a fragile law-and-order situation, and vulnerabilities within the country’s financial sector.

The ADB’s revised forecast is lower than the World Bank’s June projection, which estimated Bangladesh’s economic growth at 5.7 percent for FY 2024-25.