While the Interim Government has laid the groundwork for structural reforms, setting off a path towards transformation, the success of those reforms depends on the next elected government.
"The success of many reforms depends on the political will and institutional capacity of the next elected government to carry them forward," the latest economic update released by the General Economics Division (GED) of the Planning Commission said.
It also said the interim government has "at least provided a blueprint that future administrations can build upon."
On the challenges Bangladesh currently faces, the report highlighted youth unemployment, urban-rural inequality, higher multidimensional poverty, and climate vulnerability.
It also said the country has made major strides in restoring macroeconomic stability, making a comeback from an economy fraught with spiralling inflation, declining foreign exchange reserves and high non-performing loans when the government assumed office.
This revival involved urgent fiscal discipline measures, including rationalising subsidies and public expenditures, improving tax collection, and implementing a temporary freeze on non-essential government spending, the report added.
Notably, the government's recent success in bringing down the US reciprocal tariff on 20% from 35%, at par with the country's global contenders, bolsters its capability and commitment towards an economic turnaround.
Moreover, coordinated efforts between Bangladesh Bank and the Ministry of Finance — such as tightening monetary policy, raising interest rates, and imposing import restrictions on luxury goods — have shown signs of easing inflation and stabilising the exchange rate, the report added.
The report, however, noted rice prices continue to exert significant pressure on food inflation as well as overall inflation.
The contribution of rice to food inflation rose sharply from 40% in May to 51.55% in July.
To address the supply situation, the government decided to procure 1.4 million metric tons of Boro rice between April 24 and August 31, 2025.
However, rice distribution in July was 62,889 metric tons, down by 36% from the same month a year earlier.
On the plus side, the report noted remarkable growth in mobile financial services (MFS), with year-over-year transaction volumes expanding strongly across categories such as merchant payments and salary disbursements.
March 2025 emerged as the peak month, with transaction volumes ranging between Tk1,537,579.8 million and Tk1,781,279.2 million, supported by festival-related spending.
Similarly, e-commerce transactions surged in FY25, climbing nearly 64% compared to FY24.
The report said agricultural credit disbursements peaked at Tk3,654.74 crore in May 2025, outpacing FY24 performance, while recovery patterns reflected the harvest cycle.
Industrial production showed resilience despite volatility, with year-on-year growth peaking at 11.39% in October 2024 after a brief dip in August.
The GED highlighted a significant rebound in the external sector, with the current account balance posting a surplus of $1 billion in FY25, the first positive figure in five years.
The turnaround was driven by a narrowed trade deficit, strong remittance inflows and steady service sector earnings.
Exports gathered fresh momentum, with July 2025 shipments reaching $4,770.59 million, up nearly 25% from a year earlier, pointing to improved competitiveness and global demand.
When the interim government assumed office in August 2024, the report said inflation was running in double digits, making it difficult to anticipate that the fiscal year would close at around 8.5%.
It is also the second consecutive month since February 2023 that overall inflation stayed below 9% and food inflation under 8%.
Bangladesh Bank has already announced a monetary policy targeting inflation below 7% by December 2025 while maintaining macroeconomic stability.
The report highlighted that non-food inflation remained stable throughout the last fiscal year.
Looking ahead, the GED emphasised the continuous monitoring of the domestic market and the timely supply of agricultural inputs to contain inflationary pressures.
"Looking beyond recovery and reform, the interim government recognised the need for a long-term strategic vision to transform Bangladesh's economy into one that is resilient, diversified and inclusive," the report said.
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