The World Bank has slashed Bangladesh’s FY27 GDP growth forecast to 3.4%, the lowest among South Asian economies after Afghanistan, cutting its previous projection by 1.2 percentage points.
The South Asian region’s growth has been more resilient than expected to elevated energy prices and is forecast to accelerate to 6.9% in 2026 and remain robust at 6.7% in 2027, said in its latest South Asia Economic Update report released today (6 October).
“Despite these unfavourable forces, South Asia remains the fastest-growing region due to strong momentum in consumption and investment,” the report highlighted.
In the report, South Asia comprises Bangladesh, Bhutan, India, Maldives, Nepal and Sri Lanka.
Afghanistan and Pakistan are covered separately under the World Bank’s Middle East, North Africa, Afghanistan and Pakistan (MENAAP) Economic Update, also released today.
The World Bank forecasted that India will lead the region with its over 7% growth in FY27, supported by robust domestic demand and strong exports, despite global headwinds.
India remains one of the fastest-growing major economies in the world and a key contributor to global growth, said the World Bank.
Bhutan will lead South Asia as the second-fastest-growing economy at 6.7% growth in FY27.
Meanwhile, Sri Lanka’s GDP growth is projected at 4.2% in 2027, but the recovery remains incomplete and uneven, with household incomes and labour market outcomes still lagging the broader economic rebound.
In the Maldives, economy is expected to grow by 2.2% in 2026 as tourism has been more resilient than expected. The 2027 forecast, however, has been revised down by 3.1 percentage points to 4.1%, reflecting a structurally more cautious view of medium-term growth potential.
On the other hand, Pakistan’s growth is projected to remain broadly stable at 3.8% in FY27, as elevated commodity and energy prices weigh on services and industry.
In Nepal, growth is projected to slow to 3.7% in FY27, as flood damage to energy infrastructure weighs on industry, while disruptions to trade, transport, and tourism constrain services, the report highlighted.
Afghanistan, the slowest-growing economy in the region, is set to see 3.3% growth in FY27.
Source: https://www.tbsnews.net/economy/bangladesh-see-lowest-gdp-growth-south-asia-after-afghanistan-wb-1564406
