DCCI index reveals 'deeply imbalanced' economy despite moderate growth

Dhaka Chamber of Commerce and Industry (DCCI) today (16 May) unveiled its Economic Position Index (EPI) for the second quarter of FY2026 (October-December 2025), revealing that Dhaka's economy recorded a moderate overall score of 0.50, reflecting visible advancement but persistent structural weakness particularly in the manufacturing sector.

DCCI Acting Secretary General Dr AKM Asaduzzaman Patwary presented the index at the DCCI auditorium in the capital.

The EPI, calculated as the geometric mean of three sectoral scores, showed a sharp divergence across sectors.

Agriculture topped the index with a high score of 0.80, driven by significant growth in crop and fish production, though livestock output recorded a marginal 4.8% decline due to seasonal factors.

The services sector scored 0.47, reflecting moderate improvement, while manufacturing registered a low score of 0.33, indicating severely weak industrial activity.

"Moderate improvement indicates a visible advancement in economic activities in Dhaka with no sign of heavy stagnation," the report stated. "The economy heads towards a positive trend in the last quarter of 2025."

However, DCCI's strategic assessment struck a cautionary note, describing the economy as "consumption-led rather than production-led" and "stable on the surface but deeply imbalanced underneath."

The index draws on a survey of 762 respondents, 330 from manufacturing and 432 from the services sector, across selected industries in Dhaka district, which contributes 46% to Bangladesh's GDP. 

Sectors assessed include agriculture (crops, fisheries and livestock), manufacturing (RMG, textiles, food, pharmaceuticals, leather and others) and services (wholesale trade, real estate, land transport, health and banking). Sub-sector weights were assigned based on gross output and gross value added shares aligned with FY2025 GDP contribution.

The report catalogued a range of recurring sectoral bottlenecks. Manufacturing faces energy shortages and unpredictable tariffs, a severe letter of credit liquidity crisis, a 15% VAT described as regressive, port-level lead-time delays and widespread demands for unofficial payments.

Agriculture grapples with post-harvest losses from inadequate cold-chain infrastructure and a lack of irrigation access in northern districts. The services sector is burdened by record inflation dampening consumer demand, rising operational costs and systemic exclusion of small businesses from formal credit.

DCCI called for a suite of targeted interventions. For manufacturing, it recommended an immediate launch of Micro, Small, and Medium Enterprises (MSME) loan facilities at 9% or below, uninterrupted gas and power supply to industrial zones, a temporary reduction of VAT to between 5 to 10% to boost export competitiveness, and customs fast-track measures at ports.

For agriculture, it urged the development of a cold-chain network, irrigation scale-up in northern districts and real-time digitisation of field-level reporting under the Department of Livestock Services and Department of Fisheries.

For services, it proposed a one-stop digital licencing hub to eliminate unofficial fees, anti-syndicate market monitoring and low-interest and collateral-free credit for small businesses.

The index is also intended to inform Bangladesh Bank's monetary policy stance, quarterly fiscal adjustments and periodic revision of industrial policy, according to DCCI.