Businesses hope once the elected government comes to power, economy will return to normal
THE country’s economy and trade are in a very bad state. The economic downturn caused by the COVID-19 pandemic and subsequent wars, blockades, and other factors has not yet been fully overcome, and in some cases has worsened. Inflation is still ongoing.
In addition to political instability, poor law and order, high interest rates on bank loans, gas and electricity shortages, disruptions in production, stagnation in investment, collapse in consumer demand, rising unemployment, and low imports of raw materials- overall, business, trade and investment are in dire straits.
According to a report titled ‘Bangladesh State of the Economy 2025’ published by the General Economics Department (GED) of the Planning Commission says that credit growth in the private sector has declined, banks have slowed down in loan disbursement, rising interest rates are discouraging entrepreneurs from taking up new ventures, resulting in stagnation in both employment and production.
A data from the Bangladesh Bureau of Statistics (BBS) says, GDP growth fell to just 2 percent in the first quarter of the 2025-26 fiscal year.
Political uncertainty and market stagnation directly affected the industrial and service sectors.
During the same period, growth in the agricultural sector was only 0.76 percent, in industry 2.44 percent, and in services 2.41 percent.
The rate of opening letters of credit (LC) for capital machinery imports, a key indicator of investment, decreased by more than 20 percent in 2025 compared to the previous year.
Leading businessmen in the country say that in addition to political uncertainty, law and order situation, energy crisis, and high inflation, they are also plagued by various structural problems.
Investment costs have increased due to high interest rates and tight credit policies, SMEs and new entrepreneurs in particular are facing major obstacles in financing.
Bank loan interest rates are now 14 to 16 percent, which is not at all conducive to investment.
Non-performing loans, liquidity crunch and lack of good governance in the banking sector are destroying business confidence. On the other hand, port inefficiency and logistics costs are reducing competitiveness.
Skilled labour shortages and slow technological investment are putting private sector productivity at risk in the long term.
Currently, Bangladesh is going through a transitional period economically.
If the dream of industrialization is shattered, not only will employment be affected, Bangladesh will lose its self-respect and its path to the future. For good reason, everyone is looking forward to the upcoming elections.
They are hoping that once the elected government comes to power, the situation will change. Business, trade, and investment will return to normal.