On the other hand, the predominantly Islamic country is forecast to achieve a record 7% growth this year, pushed by surging garment exports and foreign remittances.

Annual per capita GDP growth doubled in 1990-2004 compared to the 1980s and infant mortality and population growth rates have been falling.

This, even as the country's bitterly divided politicians focus on what analysts and business leaders say is personal aggrandisement, one-upmanship and economic disruption.

Now, which way the country goes depends on how the current political limbo -- caused by elections being put off after weeks of violent protests by opposition parties -- is resolved, analysts and business leaders said.

"If we can put our house in order soon and achieve political stability, 9% growth should not be a difficult target in the next two or three years," said Kazi Kholiquzzaman Ahmed, an independent economic expert. That would mean impartial polls and the next government turning its attention to fighting corruption, tackling a chronic power shortage and boosting infrastructure to help Bangladesh realise its dream of being another Asian Tiger economy.

"Otherwise, we could be in for a long period of struggles," Ahmed added. Bangladesh, which was East Pakistan until the 1971 liberation war, embraced liberal economic policies in the 1990s. The country has been governed by the pro-market Bangladesh Nationalist Party (BNP) and the socialist Awami League in turns since the end of military rule in 1991. But such is their animosity that the leaders of the parties have not spoken to each other in nearly a decade.

"We are always flying against the wind. Whatever we have achieved is despite the politicians," said M. Fazlul Hoque, president of the Bangladesh Knitwear Manufacturers and Exporters Association, a nearly $4 billion industry.

The industry, whose products include T-shirts, innerwear and socks for almost every major global brand, is expected to grow more than 30% in the year to June 2007, Hoque said. Along with woven garments like shirts, denims and trousers, it accounts for nearly 80 % of the country's total exports, which touched a record $10.5 billion in 2005/06.

But if Bangladesh was not hit by a series of crippling political blockades and violent strikes that led to the Jan. 22 polls being postponed, growth this year would have been much higher, he said. In Chittagong, the country's commercial capital and main port, containers were piled up for days as political parties blocked transport around the country demanding fair elections.

"If buyers lose confidence it's a huge problem. It is very difficult to quantify the degree of that loss," Hoque said. "Some buyers didn't feel safe to visit Bangladesh."

—Reuters