Bangladesh economy under pressure amid ‘uncharted’ political turmoil

Hopes that interim government under Muhammad Yunus can restore stability and address country’s inequalities.

The student protests that have rocked Bangladesh since July 1 and led Prime Minister Sheikh Hasina to flee in the middle of the night in a helicopter to New Delhi have battered the domestic economy, with losses estimated at billions of dollars.

Now, even as Nobel Laureate Muhammad Yunus prepares to guide an interim government in Dhaka, businesses are struggling with the unprecedented nature of recent events and what comes next.

“Very few expected the situation to turn the way it had,” Vina Nadjibulla, vice president of research and strategy at the Asia Pacific Foundation of Canada, told Al Jazeera, referring to the dozens killed and injured earlier this week and Hasina’s departure.

“Bangladesh has had many coups, but this is new – this people power, the sheer power of the demonstrators. Now we’re in uncharted territory.”

This level of political turmoil will have economic ramifications, Nadjibulla said.

Even before the events of last weekend and the bloodshed, Zaved Akhtar, president of the Foreign Investors Chamber of Commerce and Industry (FICCI), was reported saying that the Bangladeshi economy had suffered losses of $10bn due to the student protests and the curfews and communication blackouts.

On Wednesday, the Reuters news agency reported that some garment factories, a key employer and revenue generator for the South Asian nation, had reopened after four days of closure. At the same time, there are concerns of damage to trade as at least one Indian clothing producer in Bangladesh said it was diverting its production to India for the rest of the year, Reuters said.

“Those that were looking at Bangladesh as an