Bangladesh's economy: one industry, one export and the money sent home

What Bengal traded before the jute mills

The export trade is older than the country. Under the Mughals, Bengal was a centre of the muslin, silk and pearl trades, and the Wikipedia economy article cites Dutch records in which Bengal supplied more than 50% of the textiles and about 80% of the silks the Dutch imported from Asia. Dhaka was the centre of cotton weaving, and muslin was sold as far as Central Asia under the name of the city. Bengal built ships as well, and its rice ships used a flush deck that the East India Company copied in the 1760s.

The colonial period moved the commercial centre west. The Company developed Calcutta as its capital, and the development of eastern Bengal was thereafter limited to agriculture. That is the economy the partition of 1947 inherited: a hinterland growing jute for mills across a new border.

What the economy was built on before independence

For most of the twentieth century the economy of eastern Bengal was jute. The Radcliffe Line of 1947 left every jute mill in West Bengal and four-fifths of the jute-growing land in the east, and under Pakistan the government in East Bengal built mills to process the crop at home; Britannica records that about 45% of the jute grown in that period was processed in the territory and the rest exported raw. Between 1947 and 1971 East Bengal produced between 70% and 50% of Pakistan's exports, and Britannica adds that jute was Pakistan's largest export while almost all of its earnings were spent in West Pakistan.

Independence brought nationalisation. The government took over industries and businesses abandoned by Pakistani owners, and all domestic banks, and up to 70% of industry was still in public ownership when Hussain Muhammad Ershad's government set about privatising it in the 1980s, after Ziaur Rahman's government had begun encouraging private enterprise. The famine of 1974 came in the middle of that period. Bangladesh Bank is the central bank, and much of the bank nationalisation was reversed by privatisation in the 1980s.

Jute survived as a declining trade. Export Promotion Bureau figures reported by the Financial Express put jute and jute goods at US$820.16 million in the fiscal year 2024-25, down 4.10% on the year before.

How garments came to dominate exports

The garment industry began small. BGMEA's own series starts in 1983-84, when ready-made garments earned US$31.57 million of US$811 million in total exports. Two policy changes of the mid-1980s helped exporters, and the share passed half in 1990-91. The industry grew at double-digit rates through most of the 1990s, and the end of the Multifibre Agreement quotas in 2005 did not stop it.

The table shows two things beyond the growth. The share has not fallen below 74% since 1998-99, so no other export has grown fast enough to reduce it. And the peak in 2021-22 was followed by two falls: BGMEA marks the figures for 2022-23 and 2023-24 as revised, and total exports in 2023-24, at US$44,469.74 million, were lower than two years before. In 2024-25 knitwear earned US$21.15 billion and woven garments US$18.18 billion.

Britannica lists Europe, the United States and Canada as the main destinations, and imports come principally from China and South Asia; imports usually exceed exports. The World Bank series gives exports of goods and services at 11.1% of GDP in 2025, against a high of 20.2% in 2012.

Who works in the garment factories

The industry is a mass employer of women. By the late 1990s about 1.5 million people, mostly women, worked in garments and related industries; Wikipedia's economy article gives 4.4 million workers, most of them women, as a more recent estimate. The World Bank's overview notes the thousands of rural women working in the textile sector, and the Wikipedia economy article credits the urban garment industry with more than one million formal jobs for women and with raising female participation in the labour force.

Its safety record is part of the record. In April 2013 the Rana Plaza building collapsed with at least 1,135 textile workers killed, which led to the Accord on Fire and Building Safety in Bangladesh. A strike movement in 2006, which affected almost all of 4,000 factories, ended with three workers killed when police were used against it. In 1995 BGMEA, the International Labour Organization and UNICEF signed an agreement to end child labour in garment factories.

The industry also carries the country's exposure to trade policy. In April 2025 the United States imposed a 37% tariff on Bangladeshi goods, and exporters told the Financial Express in July 2025 that American buyers were holding back orders while the rate was negotiated. Between August 2024 and July 2025 about 245 factories closed, affecting some 100,000 workers.

What remittances bring in

Bangladesh Bank publishes the second earner, wage earners' remittances, month by month; the twelve months from July 2025 to June 2026 came to about US$35.6 billion, with the highest month, March 2026, at US$3,752.21 million. That puts a year of remittances at about three-quarters of a year of merchandise exports.

The people sending it show in the World Bank's migration series. Net migration out of Bangladesh was 1,158,420 in 2008 and 402,100 in 2025, and in every year from 2000 to 2025 more people left than arrived. Remittances and aid together have historically financed a trade deficit.

Britannica dates Grameen Bank to 1976 and Muhammad Yunus's work there; Wikipedia gives 1983 as the year it was established as a bank. By the 2010s more than 30 million Bangladeshis were members of microfinance institutions, in Britannica's count.

How much agriculture still matters

Agriculture has shrunk as a share of output and much less as a share of work. The World Bank series gives agriculture, forestry and fishing at 22.7% of GDP in 2000 and 11.4% in 2025, while industry rose from 22.3% to 34.0% and manufacturing alone from 14.0% to 22.4%. Yet the World Bank's overview says agriculture employs nearly half the population, and Britannica gives the same proportion for the labour force.

Rice is the main crop, grown in three seasons, alongside wheat, pulses, oilseeds, sugarcane, tobacco and fruit. Jute and tea earn foreign exchange. Irrigation has made the dry season productive: the Karnaphuli, Tista Barrage and Ganges-Kabadak projects and thousands of tube wells allow double and triple cropping. Aquaculture supplies more than two-fifths of the fish yield, and hilsa is among the freshwater catch. Frozen and live fish earned US$441.58 million in exports in 2024-25, US$296.29 million of it from shrimp.

Britannica calls the lack of minerals a major obstacle: the first oil well was drilled near Sylhet in 1986 without finding marketable petroleum, and natural gas, mostly around Comilla and Sylhet, is used for fertiliser and power. Declining gas reserves have made Bangladesh an importer of liquefied natural gas.

What the figures say about growth and strain

Growth was steady for two decades. The World Bank series records real growth of 5.3% in 2000, 6% or more in thirteen of the fifteen years from 2005 to 2019, and 7.9% in 2019. GDP rose from $53.4 billion in 2000 to $460.1 billion in 2022, and GDP per person from $397 to $2,716 over the same years. The World Bank's overview describes a country that reached lower-middle-income status within four decades of independence.

The strain shows in the recent years. Growth fell to 4.2% in 2024 and 3.5% in 2025. Consumer price inflation, 5.5% in 2021, reached 9.9% in 2023, 10.5% in 2024 and 8.8% in 2025. GDP measured in dollars fell from $460.1 billion in 2022 to $437.4 billion in 2023. The World Bank estimates that national poverty rose for three consecutive years, from 18.7% in 2022 to 21.4% in 2025. It projected growth of 3.9% for the fiscal year 2026.

Tax revenue was 7.6% of GDP in 2021 in the World Bank series, and the IMF put general government debt at 42.0% of GDP in 2025, up from 27.7% in 2016. The Wikipedia economy article names non-performing loans in the banking sector as a persistent concern, and the World Bank's overview speaks of financial sector stress.

The Wikipedia economy article records that by 2026 the taka had lost 43% of its value against the US dollar since 2021, and that the curfew and protests of July and August 2024 cost the economy over $1.2 billion. Import costs rose after 2022, and the electricity sector, dependent on imported fuel, felt them first.

What infrastructure the growth paid for

Household electricity coverage reached 100% in 2022, in a country that had daily blackouts in 2009, and an off-grid solar programme serves about 20 million people. The Padma Bridge, the Dhaka Metro, the Karnaphuli Tunnel and the Matarbari Port were planned in the same period, and the Rooppur nuclear plant is being built with the Russian company Rosatom.

Much of the older system still runs on water. Britannica records that inland waterways carry most domestic and foreign cargo, that the seaports are Chittagong and Mongla, and that in the wet season country boats, flat wooden craft poled or paddled, replace the rural roads the floods submerge. In towns the cycle rickshaw remains the common vehicle.

The labour those projects absorb comes from a young population that is ageing. The World Bank series shows the share under 15 falling from 37.3% in 2000 to 27.6% in 2025 and the working-age share rising from 59.2% to 65.7%, while the urban share went from 23.3% to 33.2%. The World Bank's overview counts two million young people entering the labour market each year.

What leaving the least developed category means

Bangladesh is scheduled to graduate from the United Nations list of least developed countries on 24 November 2026, under a General Assembly resolution. The status matters because of what it carries. A study listed on the UN's LDC portal says the textile and clothing sector makes heavy use of trade preferences for LDCs, and the portal tracks Bangladesh's position under the European Union's generalised scheme of preferences. Other studies there examine the pharmaceutical industry, which met 98% of domestic demand as of April 2024 by Wikipedia's figures, and what the end of the LDC transition period under the WTO's rules on patents would mean for medicine prices such as insulin.

The date is under review. On 18 February 2026 the government asked the UN Committee for Development Policy to extend the preparatory period under its crisis response provision, and the Committee concluded that an extension by the General Assembly would be appropriate if Bangladesh makes significant progress on domestic reforms addressing what it called persistent structural vulnerabilities.