IMF projects 6.5% growth for Bangladesh in FY22

The International Monetary Fund (IMF) has forecasted 6.5% GDP growth for Bangladesh in the current fiscal year.

The projection came from the World Economic Outlook of the IMF titled "Recovery During a Pandemic Health Concerns, Supply Disruptions, and Price Pressures" released on Tuesday.

The World Bank projected 6.4% growth for Bangladesh in the current fiscal year last week. The projection of the IMF is just 10 basis points higher than that of the World Bank.

Earlier in April, the IMF predicted 7.5% growth for Bangladesh's economy in FY22, higher than the government's target of 7.2%. The development agency dropped the projection by 1 percentage point.

The report projected 4.6% growth for Bangladesh in FY21. The rate is 87 basis points lower than the preliminary estimate of the BBS, 5.47%.

The IMF projected 5.7% inflation in the current fiscal year, slightly higher than that of the previous fiscal. The report anticipated a moderate inflation for the following years, which would drop to 5.4% in 2026.

The IMF projected 9.5% growth for the Indian economy in FY21. The lender downgraded the growth projection for the country from the previous projection of 12.5%.

The Indian economy shrank by 7.3% in the FY20 owing to Covid-19 and it would recover by 8.5% in FY22.

The report projected 5.6% growth for China in the fiscal year, significantly lower than the FY21 growth of 8%.

The report projected the rebound of the emerging and developing Asia with 7.2% average growth of the region in 2021 following 0.8% negative growth in 2020.

The report projected 6.3% growth in the region in 2022 and 5.3% in 2026. 

Maldives is projected to have 18.9% growth, the highest in the South Asia region in 2021.

Other south Asian countries would achieve lower growth than Bangladesh. 

The report omitted all projections for 2021–26 owing to an unusually high degree of uncertainty. 

Strong projection for global recovery with more uncertainty

The Washington-based global financial institution projected a stronger recovery in 2021 and 2022 for the after shrinking 3.1% in 2020.

The report projected 5.9% growth in global output in the current year, 0.1 percentage point lower than the July forecast. The global economy is projected to grow 4.9% next year.

The IMF said the downward revision for 2021 reflects a downgrade for advanced economies - in part due to supply disruptions – and for low-income developing countries, largely because of worsening pandemic dynamics. 

Rapid spread of delta and the threat of new variants have increased uncertainty about how quickly the pandemic can be overcome, the report added.