21 lakh more Bangladeshis fell into poverty: WB
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Driven by rising inflation, 21 lakh more people fell into poverty in 2025 as the real income and purchasing power of citizens are falling.
In total, the number of people living below the poverty line in the country stands at nearly 3.64 crore.
The World Bank (WB) confirmed the information on Tuesday, in its report titled “Bangladesh Development Update” and said economic growth has stalled due to energy sector crises, a fragile banking sector, and slow revenue collection.
As a result, gross domestic product (GDP) growth in the 2026-27 fiscal year may drop to 3.4 percent. The report added that the rampage of default loans and capital deficits are placing the banking sector under severe risk.
According to the report, the poverty rate based on the national poverty line has increased for the fourth consecutive year. In 2022, this rate was 18.7 percent. In 2025-26 fiscal year, it rose to an estimated 22.5 percent. As a result, 21 lakh more people became impoverished in 2025.
Income inequality has also increased during the same period. Job creation has stalled, and women have lost jobs. Moreover, had global conflicts not occurred, 17 lakh people were expected to escape poverty in 2026.
However, only around 5 lakh people will be able to exit poverty. As a result, the condition of 12 lakh people will remain unchanged.
WB said there is no alternative to urgent and bold reforms in three sectors to bring momentum to the economy and avoid a recessionary situation. These sectors are the banking sector, domestic revenue collection, and the energy sector.
WB Divisional Director Jean Pesme said, “Bangladesh urgently needs financial, energy, and revenue reforms to restore growth and create jobs.
“Growth in Bangladesh’s economy is declining. Private investment and employment have weakened. Industrial production is being disrupted due to gas and electricity shortages. Default loans and capital deficits are rising in the banking sector. High inflation is eroding people’s real income and purchasing power.
“Meanwhile, although the government provides large subsidies in social protection, power-energy, and fertilizer assistance, a significant portion of it does not reach poor people. While many affluent families receive benefits, many of the poorest families remain outside social protection.”
He added, “Investment activities have slowed down, exports have lost momentum, and inflation remains at a high level, which has reduced household purchasing power and increased business costs. Weaknesses in the financial sector continue to affect investor confidence.
“On the other hand, limited revenue resources have hindered public investment. Despite these headwinds, the external sector has demonstrated stability supported by strong remittance inflows and growing foreign exchange reserves.
“If energy supplies gradually ease and the pace of government reform programs accelerates, GDP growth could slightly increase to 3.9 percent in fiscal year 2028.”
