DHAKA, 15 Oct: Bangladesh economy did quite well during financial year 2001 that ended in June last though prolonged political turmoil and rising fiscal pressures somewhat threatened the country’s fragile macro-economic stability.

During the year GDP growth was estimated at six per cent compared to 5.9 percent growth achieved in the previous year. This was made possible largely because of successive bumper crops and some improvement in the industrial sector.

Favourable weather together with availability of agricultural inputs contributed to produce a record level 26.8 million tons of food grains — up 7.6 per cent from 24.9 million tons achieved in FY2000. The agriculture sector’s overall growth was estimated at five per cent.

While the GDP growth for the current year (FY2002) has been projected at six per cent, it is unlikely to be achieved because of the shock waves that afflicted the whole world following the 11 September terrorist attacks in the United States and the subsequent developments. In fact, this sudden development has added a lot more uncertainty to an already weakening global economy.

Food production target for FY2002 has been set at 27.9 million tons, 4.1 per cent higher than the actual production achieved in FY2001. While it is too early to make any realistic assessment on the prospect of achieving the production target, drought situation prevailed in large part of the northern region till early September seems to have affected standing aman rice crop there. The agriculture sector contributes a third of the country’s total GDP and, therefore, its performance is very important for the annual GDP growth.

The gloomy external scenario has already started casting its lengthening shadow over the country’s foreign trade. According to preliminary information available from various sources, including the World Bank and the Asian Development Bank, pressures on external balance have further aggravated, and external environment deteriorated considerably.

During the first two months of FY02 — July and August — exports suffered a setback with a 6.3 per cent decline in earnings compared to the corresponding period last year.