The Asian Development Bank (ADB) has projected a gradual recovery for Bangladesh’s economy forecasting GDP growth to rise to 4.0% in FY2025-26 and 4.7% in FY27 according to the Asian Development Outlook (ADO) April 2026. This follows a lower growth rate of 3.5% in FY25.
The ADB attributes this upward trend to easing political uncertainty following the general election which is expected to boost private consumption and investment.
The services sector is set to bounce back due to improved purchasing power while industrial activity will be bolstered by export growth and infrastructure focus.
Despite Middle East tensions remittance inflows are expected to remain steady supporting domestic demand.
ADB Country Director Hoe Yun Jeong emphasized that the new government’s reform agenda is a critical opportunity to stabilize the macroeconomy and restore private sector confidence.
While growth is rising, the economy faces significant headwinds: High Inflation: Prices are projected to stay high at 9.0% in FY26 due to global energy costs, before slightly moderating to 8.5% in FY27.
Trade Gaps: The current account deficit is expected to widen slightly to 0.6% by FY27 as import demand for industrial raw materials increases.
The ADB warns that risks remain "firmly tilted to the downside." Prolonged conflict in the Middle East could disrupt energy markets and shipping routes, further straining foreign exchange reserves and increasing the fiscal deficit through energy subsidies.
Additionally Bangladesh remains highly vulnerable to persistent climate-related shocks.
