Political Instability and Natural Disasters Hamper Bangladesh's Economic Growth: ADB Lowers Forecast

The Asian Development Bank (ADB) has revised its forecast for Bangladesh’s economic growth to 5.1% for FY 2024-25 due to political unrest, floods, and high inflation. Earlier, the growth was projected at 6.6%. Nobel laureate Muhammad Yunus has taken charge of the interim government amidst ongoing reforms.

The Asian Development Bank (ADB) has revised its forecast for Bangladesh's economic growth to 5.1 per cent for the fiscal year 2024-25, down from an earlier estimated 6.6 per cent. The downgrade is attributed to political unrest in July and August, as well as recent floods, as reported by The Daily Star newspaper.

Bangladesh's macroeconomic outlook remains highly uncertain, with major risks stemming from ongoing political instability, a fragile law-and-order situation, and vulnerabilities within the financial sector. Elevated inflation and tight global monetary conditions are further suppressing demand.

Meanwhile, Nobel laureate Muhammad Yunus has been sworn in as the head of the interim government, following the resignation of Prime Minister Sheikh Hasina, who fled to India amidst student protests. Yunus has announced the formation of six commissions aimed at reforming the judiciary, election system, administration, police, anti-corruption commission, and the constitution.

(With inputs from agencies.)