Thanks to strong net exports and sharp drop in imports, the Asian Development Bank (ADB) raised its estimated growth for Bangladesh in FY24 to 6.5%, higher than 6% it set for FY23.
In its Asian Development Outlook (ADO) for July 2023, it also maintained its growth outlook for developing economies in Asia and the Pacific at 4.8% this year, as robust domestic demand continues to support the region's recovery.
The ADB previously in April earlier this year had forecasted 5.3% growth for Bangladesh's economy in FY23.
On the supply side, manufacturing firms of all sizes leveraged supportive government policies to contribute to growth, the ADB said in its report about Bangladesh.
It also said that crop losses to floods, cyclones, and droughts were partly offset by subsidies, incentives, and other measures.
The service sector was buoyed by higher warehouse and support activities and health and social services, while on the demand side, growth in public consumption outpaced expectations, as did public investment.
Meanwhile, 2023 inflation projections for Bangladesh and Nepal have been raised, leaving Pakistan's inflation forecast unchanged.
The ADB maintained the growth projection for the region in the current fiscal year at 4.8%, as robust domestic demand continues to support the region's recovery.
The region's growth forecast for next year is marginally revised down to 4.7% from a 4.8% estimate in April.
The report projected growth for the South Asia region at 5.5% in 2023 and 6.1% in 2024 given balancing developments.
The development bank expects that inflation in the region will fall further in the coming days, approaching pre-pandemic levels as fuel and food prices decline globally.
It lowered the inflation forecast to 3.6% this year, compared with an April forecast of 4.2%.
The inflation outlook for 2024, meanwhile, is raised to 3.4% from an earlier estimate of 3.3%.
The 2024 inflation forecast for South Asia, which was kept at 8.1% for 2023, has been revised up markedly to 6.4%.
