The World Bank has significantly lowered its growth projection for Bangladesh, forecasting gross domestic product (GDP) expansion of only 3.3% for the 2024–25 fiscal year—down from its January estimate of 4.1%—amid mounting political uncertainty and persistent financial challenges.
The downgrade, detailed in the World Bank’s South Asia Development Update released on Wednesday (23 April), paints a stark picture of the economic landscape. It also warns that the country’s twelve-month average inflation could reach 10% in FY25.
"This primarily reflects the disruptions arising from last summer's social unrest and political tensions,” the report stated.
“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."
Of the recent projections by multilateral lenders, the World Bank's outlook is the most pessimistic.
Just a day earlier, the International Monetary Fund estimated Bangladesh’s GDP growth at 3.8%, while the Asian Development Bank, earlier this month, projected 3.9% growth for the same period. Both also flagged inflation remaining around 10%.
The subdued outlook for Bangladesh mirrors a broader regional trend.
With global economic uncertainty escalating, growth projections across South Asia have been revised downward.
The World Bank now expects regional growth to slow to 5.8% in 2025, down 0.4 percentage points from its October forecast, before rebounding slightly to 6.1% in 2026.
The multilateral lender underscored that these forecasts are exposed to elevated risks, with fragile fiscal conditions across the region making countries vulnerable to external shocks.
Martin Raiser, World Bank vice president for South Asia, commented, “Multiple shocks over the past decade have left South Asian countries with limited buffers to withstand an increasingly challenging global environment.”
He emphasised the urgency of structural reforms: “The region needs targeted reforms to strengthen economic resilience and unlock faster growth and job creation. Now is the time to open to trade, modernise agricultural sectors, and boost private sector dynamism.”
