We expect real GDP growth to average 6.4% a year in 2010/11-2014/15. Growth will be underpinned by the steady expansion of private consumption and investment. The main determinants of private consumption growth will be the performance of the agricultural sector and remittances from the country's diaspora and Bangladeshis working overseas. Although the agricultural sector accounts for less than 20% of GDP at factor cost, it is the country's largest employer and the main source of income for around one-half of the working population. The farm sector is expected to expand at an average annual rate of 3.9% in 2010/11-2014/15, compared with 4.3% in 2005/06-2009/10. Workers' remittances are forecast to grow in the next five years, but the pace of growth in the early part of the period will be tempered by weak employment prospects in the Middle East, the most popular destination for Bangladeshi workers. We expect private consumption to grow by an average of 5.9% a year in the forecast period. Gross fixed investment will increase by 7.7% annually in 2010/11-2014/15. This component is dominated by the private sector, which accounts for 80% of total fixed investment. Private investment should benefit from improving business sentiment. It is also likely to be boosted by government efforts to attract greater foreign direct investment into Bangladesh from India, China and Russia, as well as from members of the country's diaspora in OECD countries.

GDP growth at factor cost will continue to be driven by services and industry. In 2009/10 services accounted for an estimated 52.6% of GDP at factor cost, while industry contributed 28.5%. Output growth in the industrial sector is expected to average 7.2% a year in 2010/11-2014/15. The manufacture of textiles and clothing will continue to make the largest contribution to growth in output. However, the sector faces major challenges, such as tougher competition (particularly from other low-cost production locations such as Vietnam and Cambodia) and forecast stunted economic growth in major export markets in the early part of the forecast period. The services sector is expected to grow at a similar pace to industry as the government continues to focus on developing the country's outsourcing capabilities, including call centres.

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