Moody’s Investors Service reports that Bangladesh faces moderate risk in its balance of payments (BoP) among South Asian countries due to a significant decline in foreign currency reserves. The forex reserve dropped from $40.7 billion in August 2021 to $19.5 billion, attributed to increased import payments, lower remittances, and export receipts.
The report highlights Pakistan and Sri Lanka as more vulnerable to BoP crises. India, with reserves at $595 billion, is the least susceptible, given its diversified export sector and robust macroeconomic policies. While Bangladesh’s ready-made garment sector provides export strength, Moody’s warns of challenges, such as a small export base, low foreign direct investment, and high import tariffs hindering global integration. The report emphasizes the need for improved trade infrastructure and policies in the region for sustained growth.
