Bangladesh is currently grappling with a deepening economic crisis exacerbated by ongoing unrest, with inflation reaching its highest level in 12 years. According to the Bangladesh Bureau of Statistics, the consumer price index surged to 11.66% in July, while food inflation soared to over 14%, marking the first time in 13 years it has reached such levels, The Daily Star reported.

The unrest, initially sparked by protests against the government job quota system, has severely disrupted supply chains across the country. Businesses are also struggling with a liquidity crunch, as the central bank has imposed a cap on cash withdrawals due to the uncertain political situation following the ouster of Sheikh Hasina's government. The interim government, led by Nobel laureate Muhammad Yunus, is attempting to restore stability.

Citizens are currently limited to withdrawing no more than 2 lakh Bangladeshi Taka at a time from banks, further complicating the economic landscape. India Today visited Kawran Bazar, Dhaka's largest wholesale market, where local retailers reported challenges in maintaining stable prices for essential goods, despite the devaluation of the Bangladeshi Taka against the US dollar.

Retailers like Shafiqur and Rafiq expressed concerns that while they have managed to keep prices relatively stable despite supply chain disruptions, they anticipate a rise in costs soon. The Bangladeshi government has reportedly assured traders that price increases will be allowed next month as the cost of imported essentials, such as rice, pulses, and spices, continues to rise.

Bangladesh’s foreign exchange reserves have also seen a significant drop, falling from $21.78 billion in June to $20.48 billion in July, according to the Central Bank. This decline has prompted the interim government to implement stricter financial controls, including capping cash withdrawals, which traders say is hindering their ability to buy foreign currency necessary for trade, thereby further fueling inflation.

The unrest, which has led to the deaths of over 400 people, forced Prime Minister Sheikh Hasina to resign and brought Muhammad Yunus to power as the head of the interim government. The protests have also led to a mass exodus of minorities, particularly Hindus, who have faced targeted violence. Despite repeated calls for peace from Yunus and other leaders, the situation remains volatile, especially in the more remote areas of the country.