Bangladesh may gain $2b in US exports from tariff edge in FY26

Banglapress Published: 23 September 2025, 10:26 AM

Bangladesh may gain $2b in US exports from tariff edge in FY26

Bangla Press Desk: Bangladesh could secure as much as US$2 billion in additional exports in the 2025-26 fiscal year, benefiting from tariff advantages over India and China under US trade policy, said Zahid Hussain, former lead economist of the World Bank’s Dhaka office. Delivering the Moazzem Hossain Memorial Lecture organised by the Economic Reporters’ Forum (ERF) on Saturday, Hussain noted that tariffs imposed by the Trump administration on Indian and Chinese exports had created a window for Bangladesh to expand its US market share. According to him, Bangladesh could earn between $1.87-2.05 billion in extra export orders in the next fiscal year – $1.2-2.07 billion diverted from India and $70-250 million from China. “India is facing tariffs roughly 30% higher than Bangladesh, which creates a significant export advantage for us,” he said.

Stability with warning signs Hussain said the economy has become more stable compared to last year, with inflation easing to 8.55% in FY25 from 9.72% in FY24, and the taka’s depreciation slowing to 4.1% from 11.3%. Foreign exchange reserves currently stand at $26 billion. But he cautioned that stability should not be confused with sustainability. “This stability has come largely from the removal of those responsible for earlier instability, rather than from sound policymaking,” he argued. Money laundering has declined, hundi inflows have fallen, and large-scale bank looting has stopped, but non-performing loans have still surged past Tk4.2 lakh crore, he said.

Employment, poverty and inequality Despite some macroeconomic relief, household conditions are worsening. Employment among 100 million working-age people fell from 58.3% in FY24 to 55.8% by March FY25, while real wages remain negative, albeit declining at a slower pace. Citing PPRC survey data, Hussain said extreme poverty rose from 5.6% in 2022 to 9.3% in June 2025, while moderate poverty climbed from 13.1% to 18.6%.

Vulnerable households rose to around 18%, 52% of families reported chronic illness, and nearly three-quarters (74.6%) said bribes or payments were needed to access services. “Inequality is worsening too, with the Gini coefficient rising by 0.43 percentage points in three years. Per capita income is increasing, but so are poverty and inequality. This is a classic middle-income trap,” Hussain observed. He pointed to obstacles blocking Bangladesh’s economic transition: a distressed banking sector, power and energy shortages disrupting factories, demand-supply mismatches, weak tax administration, poor logistics, and institutional decay. “These weaknesses undermine investment and growth,” he said, noting that private investment continues to fall despite gains in exports, remittances, and per capita income. Reform challenges

Hussain described irregularities as “the norm” in Bangladesh, citing the departure of figures “from mosque imams to central bank governors” after August 5. “But has there been any game-changing reform yet? Political goodwill alone is insufficient. Reform requires delivery capacity, and unless the cabinet, administration, business community, and civil society are all engaged, progress will stall,” he warned. He characterised the current Council of Advisers as “sincere and courageous in some areas, but helpless or directionless in others.” Voices from business Mahbubur Rahman, a leading businessman and trustee board member of The Financial Express, echoed the concerns, saying that the expected economic turnaround after the July revolution had yet to appear. “Inequality has worsened, and opportunities remain limited,” he said. The session was presided over by ERF President Doulot Akter Mala and conducted by General Secretary Abul Kashem. This article was originally published on Daily Sun.

[Bangla Press is a global platform for free thought. It provides impartial news, analysis, and commentary for independent-minded individuals. Our goal is to bring about positive change, which is more important today than ever before.]

Bangladesh may gain $2b in US exports from tariff edge in FY26

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