The Asian Development Bank (ADB) has revised downwards GDP growth projection for Bangladesh in FY2026, citing weaker exports amid subdued global demand and supply disruptions.
The Manila-based lender unveiled its its flagship publication Asian Development Outlook for December 2025 for the Asia Pacific region on Wednesday.
The report says Bangladesh’s lower forecast reflects weaker-than-expected export performance and greater investment uncertainty arising out of the effect on policy of upcoming national elections in February.
It also reflects weaknesses in the financial sector. Exports have been weighed down not only by subdued global demand but also by supply disruptions resulting from a major strike in October at Chattogram Port, which handles more than 90% of the country’s imports–exports
Inflation outlook, on the other hand, has been retained for Bangladesh as assumptions hold for tighter monetary and fiscal policies, efforts to mitigate exchange rate volatility, and declining global commodity prices.
In contrast, Growth in South Asia is expected to remain robust, with the 2025 forecast revised upward to 6.5%, from 5.9%, and the 2026 forecast maintained at 6.0%. This is driven by upgrades to India’s outlook based on robust growth in domestic consumption.
Inflation projections for South Asia are revised down to 3.3% in 2025, compared to 3.7% in the ADO September, and retained at 4.7% for 2026.
The ADB has raised its growth forecasts for economies in developing Asia and the Pacific for this year and next, amid stronger-than-expected exports and reduced trade uncertainty following the conclusion of several trade agreements with the United States
Resilient exports—particularly of semiconductors and other technology products— moderating inflation, and stable financial conditions have strengthened the region’s growth outlook.
Lifted by stronger-than-expected growth in India, the region’s economy is now projected to expand by 5.1% this year, compared with a 4.8% forecast in September. The outlook for next year has also been upgraded by 0.1 percentage points to 4.6%.
“Asia and the Pacific’s solid economic fundamentals are underpinning robust export performance and steady growth, despite a global trade environment clouded by historic levels of uncertainty over the past year,” said ADB Chief Economist Albert Park.
“Trade agreements have partly eased that uncertainty, but external and other challenges could still weigh on the outlook. Governments in the region should continue to foster open trade and investment to sustain resilience and growth,” he added.
Risks to the regional outlook include renewed trade tensions and financial market volatility, as well as geopolitical pressures and a worse-than-expected deterioration in the People’s Republic of China’s (PRC) property market.
The PRC’s growth forecast for this year has been raised to 4.8% from 4.7%, amid resilient exports and continued fiscal stimulus. The outlook for 2026 remains unchanged at 4.3%.
India’s 2025 growth projection is raised by 0.7 percentage points to 7.2%, reflecting stronger third-quarter expansion as tax cuts supported consumption. The 2026 forecast stays unchanged at 6.5%.
The outlook for the Caucasus and Central Asia subregion has been revised up to 5.8% this year from a previous forecast of 5.5%, buoyed by strong public investment, rising remittances, and robust domestic demand.
Southeast Asia’s growth projection for this year has been upgraded by 0.2 percentage points to 4.5%, reflecting a strong third quarter in Indonesia, Malaysia, Singapore, and Viet Nam. The forecasts for the Pacific are unchanged for this year and next, at 4.1% and 3.4%, respectively.
Inflation in developing Asia and the Pacific is expected to ease further to 1.6% this year, compared with a 1.7% projection in September. This mainly reflects lower-than-anticipated food inflation in India. The region’s inflation forecast for next year remains at 2.1%.