Bangladesh Sees 12-Year High Inflation Amid Protests and Political Turmoil

Bangladesh experienced a 12-year high inflation rate of 11.66% in July, driven by massive student protests against a controversial job quota system. Political unrest following the resignation of Prime Minister Sheikh Hasina led to violence and economic disruption. The GDP growth is forecasted to decline in the coming years.

Bangladesh’s inflation in July reached a 12-year high at 11.66 percent, as turmoil gripped the nation due to massive student protests over a controversial job quota system, according to the country's bureau of statistics.

The inflation rate stood at 9.72 percent in June, reported The Dhaka Tribune. Data from the Bangladesh Bureau of Statistics showed food inflation at a record 14.10 percent in July, and non-food inflation at 9.68 percent, both up significantly from June.

The previous general inflation high was 9.94 percent last May. July was marked by country-wide protests initiated by the Anti-Discrimination Student Movement, demanding reform of the quota system in government jobs. A severe government crackdown escalated the protests, leading to calls for the resignation of the Awami League government. Prime Minister Sheikh Hasina, 76, resigned and fled to India last week, leading to the formation of an interim government headed by Chief Adviser Muhammad Yunus.

Over 230 people were killed in violent incidents across Bangladesh following the fall of the Hasina government, raising the death toll to 560 since mid-July. The unrest led to curfews and internet shutdowns, disrupting supply chains and business operations. Rail and port services were also impacted. The Mastercard Economic Institute forecasted a decline in GDP growth and inflation in fiscal year 2025, projecting GDP growth at 5.7 percent and inflation easing to 8 percent from 9.8 percent in FY24.