Business in Bangladesh: Opportunities, Trends & Key Players

Bangladesh's business market is bigger than its reputation suggests. On the provisional figures of the Bangladesh Bureau of Statistics (BBS), released in June 2026, the economy crossed half a trillion dollars in the fiscal year 2025-26 — US$501 billion, the second-largest economy in South Asia, serving more than 170 million consumers and run overwhelmingly by private enterprise. Yet late 2026 finds that market mid-repair. A record inflow of remittances and a three-year delay to the loss of trade preferences sit on one side of the ledger; on the other sit a banking system carrying the world's highest share of bad loans, investment at a record low ebb, and factories short of gas. This article maps the market as it stands — its sectors, its key players, its costs, and the deadlines ahead.

The market at a glance

The BBS put nominal GDP for FY2025-26 at Tk 61.20 trillion ($501 billion), with real growth of 4.14 percent — a recovery from 3.49 percent the year before, but well below the 6–7 percent pace Bangladesh sustained for much of the previous decade. Per-capita income reached $3,020 on the BBS measure. The IMF's 2026 estimate is similar in size, about $506 billion, ranking the economy 36th in the world in nominal terms and 26th at purchasing-power parity. Services generate a little over half of output (52 percent on World Bank data for 2025), industry about a third (34 percent) and agriculture about a tenth (11 percent) — although farming still employs far more people than its share of GDP implies.

Two cautions belong beside the headline. First, the numbers themselves are contested: in January 2026 the IMF's data adequacy assessment rated Bangladesh's national accounts statistics "C", the second-lowest grade, citing outdated methods, and Bangladeshi economists have argued that growth under the previous government was systematically overstated. Second, momentum is weak where it matters most. Private investment — the market's own verdict on itself — fell from 24.18 percent of GDP in FY2022-23 to 21.53 percent in FY2025-26, and, as the finance section below shows, bank lending to businesses has slowed to the weakest pace since records began in 2003.

Garments: the engine of the export economy

One industry still defines Bangladesh's place in world trade. The ready-made garment industry exported $38.70 billion in FY2025-26, according to the Export Promotion Bureau — 80.6 percent of everything the country sold abroad, out of total merchandise exports of about $48 billion. The World Trade Organization credits Bangladesh with 6.8 percent of world clothing exports in 2025, second only to China among single countries. An estimated four million workers, most of them women, staff the factories clustered around Dhaka, Gazipur, Narayanganj and Chittagong.

The concentration is both the market's strength and its central vulnerability. Garment exports actually fell 1.64 percent in FY2025-26, and the five leading non-garment export sectors — leather and leather goods, jute and jute goods, agricultural products, home textiles and engineering products — together account for only about a fifth of exports, a share the EPB's own data show has barely moved in five years. The largest of them, leather, earns roughly $1.2 billion; engineering products earn under $1 billion. Diversifying this basket is the single most repeated prescription in Bangladeshi economic policy, and the slowest to be filled.

The second tier: pharmaceuticals, ICT and agro-processing

Below garments, three industries anchor most serious discussion of what Bangladeshi business does next.

Pharmaceuticals is the standout. Local manufacturers meet about 98 percent of domestic medicine demand, according to the industry association BAPI — a level of self-sufficiency few countries at this income level match — in a home market worth more than Tk 300 billion. Exports are smaller but growing: $238.5 million in FY2025-26, up about 12 percent on the year, to more than 150 countries, with Beximco, Square and Incepta together supplying nearly half. The industry's generics model was built under the patent waiver available to least-developed countries; that waiver now ends at graduation, and the deferral to November 2029 (see below) has given drugmakers three more years to register products and build research capacity.

Information technology is the market's most argued-over sector. Recorded computer services exports reached $684 million in FY2025-26, up 8.68 percent (EPB), and total ICT service exports were $724.6 million the year before — respectable growth, but far short of the $5 billion target the previous government set for 2025. Industry leaders counter that official figures miss much of the freelance economy: Bangladesh has about 650,000 registered freelancers, and the Oxford Internet Institute ranks it the world's second-largest supplier of online labour after India. Both things are true at once — the talent base is real and large, while recorded earnings per worker remain low, and business-process work is now exposed to automation by artificial intelligence, a pressure the Daily Star's reporting on FY2025-26 export data documented in October 2026.

Agro-processing and light engineering fill out the tier. Food processors led by groups such as PRAN-RFL ship branded goods across Asia, Africa and the diaspora markets of the Gulf and Europe; light-engineering workshops around Dhaka and Bogura supply the domestic machinery market and a thin but growing export trade. Neither yet moves the export total the way garments or even pharmaceuticals do, but both employ heavily and sell into the home market's rising incomes.

Follow the money: remittances, investment and reserves

Bangladesh's business cycle runs on two inflows, and in FY2025-26 they moved in opposite directions. Workers' remittances — the earnings of more than ten million Bangladeshis abroad — reached a record $35.59 billion, according to Bangladesh Bank, a flow roughly twenty-four times the size of net foreign direct investment. As the companion profile of migration and remittance details, that money underwrites consumption, housing construction, land prices and much informal small-business capital across the country.

Foreign direct investment, by contrast, shrank. Net FDI fell 13 percent to $1.47 billion in FY2025-26, Bangladesh Bank reported in October 2026, and the composition matters more than the total: only $365 million was fresh equity capital, while $1.03 billion was earnings reinvested by multinationals already operating in the country — power, food processing and telecoms among the largest recipients. Foreign investors, in other words, are mostly expanding what they have rather than entering anew; the central bank attributed the caution to banking-sector reform, energy shortages and wait-and-see sentiment. Foreign-exchange reserves stood at $32.93 billion on the IMF's BPM6 measure at the end of June 2026 — adequate cover, rebuilt from the lows of 2024, but dependent on the remittance tap staying open.

Key players: the business houses

Much of Bangladeshi business is organised through family-founded conglomerates that span a dozen sectors at once — a structure that concentrates capital, political access and, as recent years showed, risk.

The BEXIMCO Group, founded in 1972, remains the archetype: textiles and denim at its base, pharmaceuticals among the country's top exporters, and interests from ceramics to media. Square Group began smaller — a pharmaceutical partnership formed in Pabna in 1958 by Samson H. Chowdhury and three friends — and grew into pharmaceuticals (market leader since 1985), textiles, toiletries, food, hospitals and media. Akij grew out of trading businesses begun in the 1940s; the sale of its tobacco arm to Japan Tobacco International for $1.47 billion in 2018 remains the largest acquisition in the country's history, and the group continues across food, textiles, ceramics and more. City Group, started in edible oils in 1972, now runs around forty concerns in consumer goods, packaging, feed and shipbuilding. Bashundhara, founded in 1987 as a property developer, added cement, paper, media and the country's best-known shopping mall. Around them sit dozens of mid-tier groups, the garment-anchored giants of the export belt, and long-established multinationals — Unilever, British American Tobacco, Grameenphone and Standard Chartered among them.

The model's weakness was exposed after August 2024, when Bangladesh Bank moved to strip the S. Alam Group of its control over several banks it had dominated — an episode that revealed how group borrowing from captive lenders had quietly loaded the banking system with bad debt. No authoritative league table of the groups exists and their accounts are largely unpublished; what can be said factually is that a few dozen family-led houses account for a large share of organised private investment, and their governance is now a first-order economic issue rather than a private one.

Finance: a banking system under repair

Business runs on bank credit in Bangladesh — the corporate bond market is negligible and the stock market small (both are profiled separately in this series) — which makes the state of the banks the state of business finance. The system is crowded: 61 scheduled banks and 35 non-bank financial institutions serve the market, supervised by Bangladesh Bank.

The repair bill is large. Non-performing loans reached Tk 6.07 trillion (Tk 606,555 crore) at the end of June 2026, equal to 32.78 percent of all outstanding loans, Bangladesh Bank reported — the highest ratio in the world on the IMF's comparative indicators, down from a peak of 35.73 percent in September 2025 as tougher classification rules forced hidden defaults into the open. The system's capital-to-risk-weighted-assets ratio fell below zero at the end of 2025. Five weak Islamic banks were merged into a new state-backed institution in late 2025, and in November 2026 the central bank gave initial approval to five digital banks — backed by bKash, Robi Axiata, VEON with Square, and others — betting that new entrants can reach the small businesses the incumbents underserve. Small and medium enterprises, the economy's employment backbone, are where the credit failure bites hardest: they borrow least formally and pay most for it.

The transmission to ordinary business is direct. Private-sector credit growth fell to 4.17 percent in September 2026, the lowest since the central bank's series began in 2003, and the outstanding stock of private credit barely moved between December 2025 and August 2026. Weighted-average lending rates stood at 11.83 percent in August 2026, even after the policy rate was cut to 9.5 percent that July — banks rebuilding capital and provisioning are in no hurry to lend. For a garment exporter or a Narayanganj dyeing mill, the practical meaning is working capital that is scarce, slow and expensive.

Organised business: chambers and associations

Bangladeshi business speaks to government through one of the developing world's denser trade-body landscapes. The apex body is the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), established in 1973, with more than 500 member chambers and associations; its board was dissolved and an administrator installed in September 2024, part of the post-transition reset of national institutions. The Dhaka Chamber of Commerce & Industry (DCCI), formed in 1958 and the largest single chamber, is the usual first port of call for small and mid-sized firms. The Metropolitan Chamber (MCCI), founded in 1904 in Narayanganj and the country's oldest trade body, carries particular weight on tax and trade policy. Around them sit the sector associations — the BGMEA and BKMEA for garments, BAPI for pharmaceuticals, BASIS for software — and it was this chamber network, consulted through 2026, that pressed the government to seek the LDC deferral described below.

The cost of doing business

Ask Bangladeshi manufacturers what constrains them and three costs recur: energy, logistics and finance (covered above).

Energy is the sharpest. Decades of cheap gas built the industrial belt, but domestic fields are depleting and imports of liquefied natural gas set the marginal price. Under the energy regulator's July 2026 order, existing industrial users pay Tk 30 per cubic metre of gas within half their permitted load and Tk 40 beyond it or for new connections; captive power costs Tk 31.50 to Tk 42; and gas for fertiliser plants rose 83 percent to Tk 29.25 from December 2025. Price is only half the complaint: through 2026, factories in the Gazipur and Narayanganj hubs repeatedly reported low pressure and curtailed supply.

Logistics is the quiet tax. World Bank estimates cited by the Policy Exchange and the Dhaka Chamber put logistics costs at 15 to 20 percent of GDP, against a global average of 8 to 10 percent; the Bank's Logistics Performance Index ranks Bangladesh 88th of 139 countries. Chittagong Port handles more than 90 percent of container trade — dwell times average about eleven days for imports — and its service tariffs rose by roughly 41 percent in October 2025, feeding straight into exporters' costs. The National Logistics Policy adopted in 2024 promises integration of ports, rail and inland waterways, but delivery, as with much else in this market, is the open question.

The LDC countdown: a three-year reprieve

Overhanging every calculation in this article is a date that moved. Bangladesh was scheduled to graduate from the United Nations' least-developed-country category on 24 November 2026, ending the duty-free access on which its export model leans. Graduation is a mark of success — the country met all three UN criteria — but exporters faced average tariffs of about 12.5 percent in markets such as the European Union once preferences lapsed, and the business community lobbied hard for time. On 29 October 2026 the UN General Assembly adopted resolution A/81/L.8, deferring graduation to 24 November 2029, after a formal request by the government that took office in February 2026. Duty-free access, including the EU's Everything But Arms scheme, continues until then. The European Union, Canada and France made their support conditional in tone if not in text: the three years are for reform — of the banking system, the tax net (Bangladesh's tax-to-GDP ratio remains among the world's lowest), energy supply and export diversification. The reprieve is best read as a deadline with better lighting.

Trends and outlook

Set against the repair bill, the forward indicators are genuinely mixed — the honest summary of business in Bangladesh at the end of 2026.

The consumer economy keeps deepening: payment cards in circulation reached 52.95 million in August 2026, nearly double five years earlier (Bangladesh Bank), mobile money is mass-market infrastructure, and industry estimates put e-commerce at roughly $6–7 billion a year, with the largest marketplace, Alibaba-owned Daraz, reporting over 50,000 sellers and delivery to all 64 districts. Retail, food processing, building materials and health care all sell into a population whose per-capita income has crossed $3,000. The opportunity set most often named by investors is consistent: pharmaceuticals racing the 2029 patent deadline, ICT services climbing from gig work toward enterprise contracts, agro-processing and light engineering for both home and export markets, and the logistics and energy infrastructure whose absence currently taxes everyone else.

The constraints are equally consistent, and they are the subjects of the sections above: a banking system that must shrink its bad-loan mountain before it can fund expansion, gas that is scarcer and dearer than the industrial model assumed, logistics costs nearly double the global norm, and an export basket still four-fifths one product. What the October 2026 deferral bought Bangladesh's businesses is time — three years in which the gap between the market's evident scale and its institutional foundations is either narrowed, or priced in by everyone who trades with it.