Much like China and other Asian giants - but unlike India - Bangladesh has achieved structural transformation with manufacturing and exports driving its growth in output (GDP) and employment.

One fine day India woke up to the realisation that Bangladesh had overtaken it in GDP growth rate when the Asian Development Bank (ADB) updated its Asian Development Outlook (ADO) report in September 2019 - though this was clear from its earlier April 2019 report too.

What the update did was to revise Bangladesh's GDP growth for 2019 upward from 8% to 8.1% and downward for that of India from 7.2% to 6.5%. Further, it retained Bangladesh's growth forecast for 2020 at 8% but downgraded India's from 7.3% to 7.2%.

The official data of both the countries, using their own fiscal calculations, however, show Bangladesh overtaking India in FY18, as shown in the following graph.

That is because of differences in their calculations. Bangladesh's 'fiscal year' calendar is from July 1 to June 30 but that of India is from April 1 to March 31. The ADB uses 'financial year' and counts fiscal years of both countries differently - for example, for it Bangladesh's FY19 ended on 30 June 2019 but that of India will run till 31 March, 2020.

Published On : 30-10-2019

Source : Business Today