IMF Sees Bangladesh Pass India on Per Capita GDP — SkimNews
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- Bangladesh is projected to pass India on per-capita GDP in 2026, $2,886 against $2,749, in the IMF's October 2026 World Economic Outlook — even with India's total output of $4.15 trillion nearly eight times Bangladesh's $506.4bn, a dollar-denominated measure that shifts with exchange rates and conceals income inequality.
- India retains the lead once prices are equalised: projected purchasing-power-parity GDP per capita of $12,998 against Bangladesh's $10,884, meaning Indians have greater buying power.
- India is forecast to grow 7% in 2026 versus Bangladesh's 3.6%, with consumer-price inflation of 5% against 8.7% in Dhaka — and both countries remain far below the developing-economy average of $7,746 per person and the global average of $15,889.
- IMF projections show the crossover reversing: Bangladesh's $3,219 against India's $3,036 in the next year, then India ahead in 2029 at $3,661 versus Bangladesh's $3,334, based on current growth forecasts.
- Santosh Mehrotra, an Indian economist, cited Bangladesh's manufacturing share of gross value added climbing from 16.6% in 2014 to 22% in 2025, while World Bank data show India's falling from 15.1% of GDP in 2014 to 13.5% in 2024.
- Bangladesh's $38bn ready-made garment industry, which supplies more than 80% of export earnings, plus remittances and growing participation of women in the workforce, drove the two-decade rise.
- Iran anchors the energy shock: the United States-Israel war on Iran has disrupted Strait of Hormuz traffic and Red Sea shipping routes, jolting Bangladesh, which imports 95% of its oil and LNG mostly from the Middle East, and disrupting its garment exports.
Why it matters: Bangladesh's crossover is nominal, not material: $2,886 per person comes with 8.7% inflation and 3.6% growth, against India's 5% and 7%, and India still leads on PPP, $12,998 to $10,884. With 95% of oil and LNG imported and garments over 80% of export earnings, the garment workers behind Bangladesh's rise are directly hit by disrupted Hormuz and Red Sea routes.
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