Bangladesh’s trade deficit widened sharply to $7.5 billion during July–October of FY26, driven by a surge in imports ahead of Ramadan and higher purchases of petroleum and fertilizer, according to the latest balance of payments data from Bangladesh Bank.
The deficit increased by nearly $2 billion within a single month. Until September, the trade gap stood at $5.7 billion, highlighting the pace at which import payments accelerated.
Central bank figures show that imports during the first four months of the fiscal year reached $22.11 billion, up 5.5% from the same period of the previous fiscal year. Exports, meanwhile, amounted to $14.5 billion, resulting in the widening trade imbalance.
In October alone, imports rose to around $5.3 billion, a notable increase compared with most months over the past year, when monthly imports generally remained below $5 billion.
A senior Bangladesh Bank official said the rise was largely due to increased imports of essential commodities ahead of Ramadan, alongside higher petroleum and fertilizer shipments.
“With Ramadan approaching, imports of daily necessities increased significantly, pushing up overall import payments during September and October,” the official said.
Central bank data indicate that demand typically rises during Ramadan for items such as soybean oil, sugar, lentils, chickpeas, peas and dates. To meet this demand, the opening of letters of credit rose sharply in September and October.
Compared with the same period last year, soybean oil imports increased by 36%, sugar by 11%, lentils by 87%, chickpeas by 27%, peas by 294% and dates by 231%. Over the same four-month period, imports of petroleum and fertilizer rose by 50% and 25% respectively.
The widening trade gap also weighed on the current account balance, which recorded a deficit of $749 million during July–October, up from $640 million in the corresponding period of FY25.
Economists and central bank officials noted that the current account remained in deficit despite a strong rise in remittance inflows, mainly due to higher import payments. The current account reflects trade in goods and services, income flows and remittances.
Remittance inflows rose to $10.1 billion during July–October, up from $8.9 billion a year earlier. However, the more than $1 billion increase was offset by the expanding trade deficit.
In contrast, Bangladesh’s financial account posted a surplus of more than $2.1 billion in the first four months of the fiscal year, supported by higher trade credit and increased medium- and long-term borrowing. Bangladesh Bank data show trade credit exceeded $1 billion during July–October, compared with a deficit of $450 million in the same period last year.
A senior central bank official said higher inflows from medium- and long-term loans had strengthened the financial account position.
Zahid Hussain, former lead economist at the World Bank’s Dhaka office, said the improvement in the financial account reflected increased trade credit and longer-term borrowing.
“As imports rise, credit financing also increases, leading to inflows in trade credit, which is usually an outflow,” he said. “This has helped offset pressures from the widening trade deficit.”
