Bangladesh’s economy is showing widening stress across key sectors as weakening demand, persistent energy shortages, climate-related disruptions and subdued investment combine to slow growth, according to findings presented on Saturday at a seminar on the Economic Position Index (EPI) by the Dhaka Chamber of Commerce and Industry (DCCI).
The event brought together policymakers, economists, development partners and private sector representatives in the capital to review short-term macroeconomic conditions using a new quarterly indicator.
The EPI, based on responses from 762 firms across manufacturing and services sectors in FY2025-26, found that falling purchasing power is eroding services sector activity, energy shortages are constraining industrial output and climate variability is disrupting agricultural production and supply chains, creating a synchronised slowdown across production, consumption and investment channels.
DCCI President Taskeen Ahmed said the economy is under strain from high inflation, foreign exchange pressure, weak investment, energy uncertainty, rising costs and slowing employment generation.
Conventional macroeconomic indicators are failing to capture real-time shifts in activity, limiting policy responsiveness, and described the EPI as a faster, data-driven reading of economic conditions.
The index was developed to address gaps in business forecasting and investment planning, with findings pointing to simultaneous stress across agriculture, industry and services.
It recommended stabilising prices, improving supply chains, ensuring reliable energy supply, expanding infrastructure, easing access to low-cost finance for CMSMEs, reducing VAT-related pressure, streamlining trade licensing and accelerating customs and cargo clearance.
Policy Research Institute of Bangladesh Chairman Zaidi Sattar said the index would be more useful if expanded nationwide, adding that it could help businesses better interpret real-time conditions and adjust strategies accordingly.
International Trade Expert Nesar Ahmed warned that Bangladesh risks losing preferential access to the European market after LDC graduation, increasing pressure on CMSMEs and underscoring the need to reduce the cost of doing business.
Ministry of Commerce Additional Secretary Shibir Bicitro Barua said inflation, weak investment and fragility in the banking sector remain key macroeconomic challenges, adding that reforms to the Import Policy Order are underway.
University of Dhaka Professor of Accountancy and Public Policy Mizanur Rahman said rising expenditure relative to income and weak investment growth are slowing economic momentum, calling for stronger financial sector reforms.
Ministry of Foreign Affairs Director General Syed Muntasir Mamun said Bangladesh should deepen reliance on capital markets for long-term financing due to structural constraints in the banking system.
Bangladesh Investment Development Authority former Executive Director Md Ariful Hoque said policy frameworks are broadly in place but implementation gaps persist, adding that greater digitalisation of public services could ease private sector bottlenecks.
Bangladesh Bank Chief Economist Akhtar Hossain said foreign direct investment remains critical for sustaining growth, noting that Bangladesh continues to lag in attracting inflows.
International Finance Corporation Senior Private Sector Specialist Miah Rahmat Ali said stronger policy and financial support is needed for businesses to withstand global uncertainty driven by geopolitical tensions and climate risks.
Speakers said the EPI highlights a synchronised slowdown across agriculture, industry, services and investment, driven by demand compression, energy constraints and structural bottlenecks, and called for coordinated policy reforms to stabilise economic momentum.
