Trade deficit drops 9pc in 7 months as exports grow faster than imports

Bangladesh’s trade deficit continues to decline in the 2024-25 financial year as export growth surpasses import expansion.

The deficit fell by 9 percent year-on-year to $11.75 billion in the July-January period of FY2024-25.

According to the latest Bangladesh Bank data released on Tuesday, the deficit was $12.91 billion in the same period last year, marking a decline of $1.16 billion or 8.98 percent.

Exports grew by 10 percent year-on-year to $26.37 billion in the first seven months of FY2024-25, up from $23.98 billion in the same period of the previous fiscal year.

Meanwhile, imports rose by 3.30 percent to $38.11 billion, compared with $36.96 billion a year ago.

An analysis of the data shows the trade deficit has narrowed due to exports growing at a faster pace than imports.

Balance of payments data further reveals that the current account deficit stood at $552 million in July-January, down from $4.28 billion in the same period of the previous financial year—a decline of 87 percent.

The financial account also recorded a surplus of $85 million in the first seven months of FY2024-25, slightly higher than the $81 million surplus seen a year ago.

Former World Bank chief economist for Bangladesh Zahid Hussain told bdnews24.com, “It cannot be said that there has been an overnight improvement in the balance of foreign exchange transactions. The deficit widened from December to January due to rising import costs, whereas the previous month’s situation was relatively better.”