My WD external hard disk's transferring is so slow!

I have a 640 GB Western Digital My Passport (USB 2.0) external hard disk. Lately it has become so slow in transferring files. The speed is around 500 KB/s whereas normally it was around 25 MB/s!!!! So I tried using the CheckDisk utility. But it could not solve the problem.

And then I decided to to backup all the files that were in my WD and I tried to format it to the normal NTFS file system. But it does not allow me to do that. I get an error message. I can only format the disk to exFAT (NTFS and exFAT are the only two options shown in the formatting window). Even after formatting it to exFAT, the transferring rate when copying files remains the same, which is around 500 KB/s.

I then ran DLGDIAG from Western Digital and it gave me this error message:

Are there bad sectors in my hard disk? If not, what is the problem? What's wrong? If there are bad sectors, what can I do to fix it and get the transferring rate back to normal? I really need this hard disk because I have a lot of personal and important files of around 500 GB and I have no other place to store them. I need to be able to copy from and to the WD quickly whenever I want. I can't afford to buy a new one.
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  1. External hard drives have proved to be much less reliable than internal ones, and your's appears to be failing. You can try to repair any bad sectors with HDAT2 but once sectors start going bad it will only get worse over time. If you want to give HDAT2 a try:
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