Private investment, industry growth fall in FY24: BBS
A significant decline in all three major industrial sub-sectors—large, small, medium, and cottage industries—led to weaker overall performance in manufacturing, a key private sector job provider
Highlights:
- All major industrial sub-sectors experienced growth decline
- Private consumption fell due to rising prices
- Service sector doing better than industry, agri sectors
- Cottage industries showing higher growth than larger ones
- Exports and imports as a percentage of GDP fell
- The tax-GDP ratio rose
- The budget deficit increased slightly
Private investment as a percentage of Bangladesh's gross domestic product (GDP) dropped in the last fiscal year, reflecting slower industrial growth, according to the Bangladesh Bureau of Statistics (BBS).
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Provisional data show that private investment fell to 23.51% of GDP in the 2023-24 fiscal year (FY24), down from 24.18% in FY23.
Private consumption also decreased by 1.8 percentage points in FY24, linked to rising consumer prices and an average annual inflation rate of 10.59% in the third quarter.
The impact of these trends is evident in the industrial sector, where growth declined from 8.37% in FY23 to 6.66% in FY24, based on provisional data for the first nine months ending in March.
The final GDP growth rate for FY23 was revised down to 5.78%, compared to the earlier estimate of 6.03%. The BBS's provisional estimate for GDP growth in FY24 stands at 5.82%.
Among the three main sectors, services accounted for 51.04% of the country's GDP, followed by industry at 37.95% and agriculture at 11.02%.
The service sector experienced a growth increase of 0.43% in FY24, while the industry sector declined by 1.71% and agriculture by 0.16% year-on-year.
A significant decline in all three major industrial sub-sectors—large, small, medium, and cottage industries—led to weaker overall performance in manufacturing, a key private sector job provider.
Growth in large manufacturing industries was estimated at 4.65% in FY24, down from 8.39% in FY23. Growth in medium, small, and micro enterprises was estimated at 5.07%, compared to 9.03% in the previous fiscal year. The growth rate for cottage industries dropped to 6.70% from 9.97% in FY23.
Value addition across all industrial segments—large, small, medium, and cottage industries—declined over the past year.
However, the BBS noted relatively higher growth in cottage industries, which contribute about 20% of the total value added in the manufacturing sector.
These industries mainly use indigenous raw materials, reducing exposure to external shocks. The BBS data indicated higher growth in the production of food, beverages, tobacco, leather goods, wood products, glass, iron products, vehicle parts, and iron furniture within the cottage industry.
The sectoral distribution shows a gradual decrease in agriculture's share of GDP, while the industry and service sectors have been increasing.
Despite steady physical output in the agriculture sector, particularly in crops and horticulture, its relative contribution has been declining, while the contributions of the industry and service sectors have risen.
The tax-GDP ratio improved, reaching 8.91% in FY24, up from 7.30% the previous year.
The budget deficit increased slightly to 5.11% of GDP in FY24, from 4.99% in FY23.
Exports and imports as a percentage of GDP fell by over two percentage points to 28.89% in FY24.
Overall investment (public and private) inched up by 0.03% in FY24, while domestic savings grew by 1.85% and national savings by 1.91%.
The BBS provisionally estimated per capita GDP at Tk 294,191 ($2,675) and per capita gross national income (GNI) at Tk 306,144 ($2,784) for FY24.
