Economic growth on slippery slope by latest measure

Bangladesh's economic growth was on a slide as the latest official count found it 2.22 per cent in the third quarter of the just-past fiscal year, in a headlong fall from 4.53 per cent estimated in the same period of previous fiscal.Maps

The primary driver behind this significant deceleration is a contraction in the industrial sector, alongside cooled growth across agriculture and services, official data showed on Monday.

The drastic fall in the industrial growth in January-March has affected the economic-growth momentum of the country as Bangladesh Bureau of Statistics (BBS) in its provisional estimation has recorded a negative 0.28-percent rate.

In the same period of the previous fiscal year (FY2025), the industrial growth was recorded at 3.33 per cent as per the BBS data.

The latest figure marks a continuing downward trajectory for the just-concluded FY2026, following a 4.96-percent growth in the first quarter and 3.03-percent growth in the second quarter.

Meanwhile, in its provisional estimation, BBS had recently shown Bangladesh's GDP could grow at a 4.14-percent rate in the past fiscal year in an upturn from a slower 3.49 per cent in the previous year (FY2025).

Analysts say the slower growth in the Q3 last fiscal may hamper the achievement of the 4.14-percent overall annual GDP growth.

According to the statistical bureau, the industrial sector experienced a negative growth of -0.28 per cent in the third quarter at constant prices, comparing poorly to the 3.33-percent growth recorded during the third quarter of FY2024-25.

Within this vital sector, manufacturing growth dipped into negative territory, to 0.34 per cent, while utility sectors like electricity, gas, and water supply experienced a deeper contraction to -3.56 per cent.

This industrial slump severely impacted the overall economic output during the January-March period.

Other key pillars of the economy also registered slower growth. The services sector, which historically carries a heavy weight in the country's GDP, grew 3.52 per cent in the third quarter of FY2026.

While this remains the strongest performing macro-sector for the quarter, it represents a steep decline from the robust 7.32-percent expansion seen in the same quarter in the previous FY2025.

Similarly, the agricultural sector recorded a growth of 1.74 per cent in Q3 FY2026. Though positive, yet this is a sharp reduction from the 4.61-percent growth achieved in the 3rd quarter of FY2025, the BBS data showed.

In nominal terms, the estimated size of the Q3 GDP at current prices reached Tk 15.391 trillion, up from Tk 14.192 trillion in the corresponding period of FY2024-25.

At current prices, the sectoral share of the economy during this quarter was led by the services sector with 54.63 per cent, followed by the industrial sector at 35.51 per cent, and agriculture at 9.86 per cent.

Analysts point out that the negative growth in industrial sectors and utilities reflects ongoing constraints in domestic production, energy-supply challenges, and shifting demand dynamics.

A rebound in momentum in manufacturing in the final quarter of the fiscal year just gone by would need "targeted policy interventions", they felt.

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