Bangladesh’s trade deficit has widened in recent months as import growth has outpaced slower export expansion. In the first eight months (July–February) of the current fiscal year, the trade deficit stood at nearly $17 billion. In February alone, the deficit increased by $3.13 billion compared to the previous month.
The information was revealed in the latest Balance of Payments (BoP) report published by Bangladesh Bank.
According to the central bank, the country’s trade deficit reached $16.91 billion during July–February of FY2025–26. In local currency, this amounts to over Tk 2.07 lakh crore. In the first seven months (July–January), the deficit was $13.77 billion, indicating a monthly increase of $3.13 billion, or approximately Tk 38,500 crore.
The deficit has also increased significantly compared to the previous fiscal year. During the same period (July–February) of FY2024–25, the trade deficit stood at $13.70 billion. It has now risen to $16.91 billion in FY2025–26, marking a year-on-year increase of $3.20 billion.
Data from Bangladesh Bank show that export earnings totaled $29.26 billion during the first eight months of the current fiscal year, while import expenditure reached $46.17 billion. As a result, import costs exceeded export earnings by $16.91 billion, contributing to the widening trade deficit.
Current Account Deficit Also Rises
The growing trade deficit has also affected the country’s current account balance. In the first seven months (July–January) of FY2025–26, the current account deficit was $319 million. However, in the first eight months (July–February), it rose to $1 billion, indicating an increase of around $700 million in a single month.
The current account is a key component of a country’s balance of payments, encompassing net trade in goods and services, income from abroad, and current transfers such as remittances.
Financial Account Surplus Increases
On the other hand, the financial account surplus has increased significantly. According to Bangladesh Bank, the surplus stood at $1.907 billion in the first seven months (July–January), rising to $4.08 billion in the first eight months (July–February). Sector insiders attribute this improvement to better trade credit conditions and increased net inflows of foreign assistance.
Trade Credit Surplus Expands
Central bank data show that the trade credit surplus increased from $1.03 billion during July–January to $2.56 billion during July–February.
Trade credit refers to an arrangement in which goods or services are received immediately but paid for at a later date. In balance of payments accounting, it is considered a short-term capital flow, as it is directly linked to the financing of imports.
Overall Balance Improves
Despite the widening trade deficit, the overall balance of payments position has improved. In the first seven months (July–January), the overall balance recorded a surplus of $1.28 billion, which rose to $3.42 billion in the first eight months (July–February). Analysts say the increase in the financial account surplus has positively influenced the overall balance.
Economist Warns of Further Pressure
M Helal Ahmed Jony, a Research Fellow at Change Initiative, said that excessive import dependence is one of the main reasons behind the country’s growing trade deficit. He added that the global economic slowdown has further aggravated the situation, particularly due to tensions involving Iran. He also noted that since the new government assumed office, there have been no visible measures to boost trade and commerce. As a result, the trade deficit is likely to increase further in the coming days.