The first quarter of FY25 (July-September 2024) marked a period of gradual economic recovery for Bangladesh, as the nation emerged from the political instability triggered by the Anti-Discrimination Students' Movement in July 2024, said a report by the Metropolitan Chamber of Commerce and Industry (MCCI),
MCCI's report on the quarterly economic situation in Bangladesh for July-September 2024 states that upheaval culminated in a government transition, and the economy now faces several pressing issues, including inflation, subdued external demand, revenue deficits, and sluggish investments.
Agriculture, which employs 45% of the labour force, accounted for 12.84% of GDP in Q4 FY24, up from 9.41% in Q3 FY24.
The sector grew by 5.27% in Q4 FY24, slightly higher than the 5.16% growth in the previous quarter, supported by favourable natural conditions and timely government interventions.
The industrial sector contracted, with its GDP share declining from 40.50% in Q3 FY24 to 35.38% in Q4 FY24.
Growth dropped to 3.98% in Q4 FY24, compared to 6.25% in Q3 FY24.
The manufacturing sub-sector also weakened, recording 6.45% growth in Q4 FY24, down from 6.93% in Q3 FY24.
While the services sector's GDP share increased to 51.78% in Q4 FY24 from 50.09% in Q3 FY24, growth slowed to 3.67%, compared to 3.81% in the previous quarter.
On 30 September 2024, the Bangladesh Power Development Board reported electricity generation of 13,176 MW against a demand of 13,946 MW, leaving a shortfall of 340 MW.
The quarter’s peak generation of 15,717 MW occurred on 20 September 2024.
Broad money (M2) growth slowed to 7.88% in September 2024, below the central bank's target of 8.20%.
Private sector credit growth also fell short at 9.20%, below the 9.80% target. Excess liquidity in scheduled banks stood at Tk.158,335 crore as of September 2024.
NBR’s tax revenue collection dropped by 6.07% year-on-year to Tk.70,902.90 crore in Q1 FY25, falling short of the target by 26.53%.
Export earnings rose by 7.62% year-on-year to $11.66 billion in Q1 FY25, while imports increased by a modest 1.64% to $16.17 billion.
Remittance inflows surged by 33.34% to $6.54 billion in Q1 FY25.
However, foreign aid disbursements dropped by 33.99%, and commitments plummeted by 99.05%, reflecting strained donor relations.
Net FDI inflows declined by 15.01% to $300 million in Q1 FY25. The trade deficit narrowed to $4.63 billion, while the current account deficit shrank to $127 million, reflecting improved trade dynamics.
The economy's recovery, though commendable in some areas, remains fragile.
Policymakers must address inflation, investment stagnation, and revenue shortfalls to sustain momentum in the coming quarters.
