Special Correspondent: Bangladesh’s trade deficit widened significantly during the July–February period of FY2025–26, mainly due to a combination of rising import payments and declining export earnings, according to the latest data from Bangladesh Bank.

The trade gap stood at $16.91 billion, up from $13.71 billion in the same period of the previous fiscal year—an increase of more than $3.2 billion year over year.

Imports grew by around 5.6% to over $46 billion during the period. Higher purchases of food grains and fertilizer. Increased import demand ahead of Ramadan. Rising global commodity prices and precautionary imports amid geopolitical tensions.

Exports fell by about 2.6%, dropping to roughly $29 billion. Weak performance in the ready-made garment (RMG) sector. Sluggish global demand and slower shipment growth. Monthly export contractions during several months of FY26. This mismatch directly increases the trade deficit.

Payments for services such as transport, travel, and foreign loan servicing also increased, adding pressure on the external balance.

Ongoing global tensions (including Middle East conflict concerns). Currency pressures and higher import costs. These factors may further widen the deficit in coming months.

Despite the widening trade gap, strong remittance inflows (over 21% growth) helped limit the current account deficit to about $1 billion.

Economists warn that unless export performance improves, especially in the garment sector, and import growth moderates, Bangladesh’s trade deficit may continue to expand in the near term.

In contrast, import payments rose to $46.17 billion in the eight-month period.

The increase was driven mainly by higher imports of intermediate goods, which rose by 7.1 per cent to $30.35 billion.

Petroleum imports surged by 52 per cent, while fertiliser imports increased by about 60 per cent, reflecting stronger demand for energy and agricultural inputs.

Imports of capital goods rose by 2.3 per cent to $6.65 billion, including a 5.7 per cent increase in capital machinery.

The data indicate cautious but ongoing investment in industrial capacity despite uncertainties in the business environment.

The higher import bill contributed to a widening services deficit, which reached $3.84 billion.