Investment Opportunities

Private sector is the main engine of growth in the economy. The government therefore attaches high priority to private investments, both domestic and foreign and has been relentlessly working for ensuring an ideal investment climate through policy and institutional supports, infrastructure, administrative and regulation reforms, modernization of financial institutions, and special incentive packages.

Bangladesh offers a competitive location for doing business in terms of costs, inputs, human resources, market access, facilitations, etc. Investments in the appropriate sectors in Bangladesh would yield higher returns than any other competing locations with lesser risks.

Bangladesh has a large supply of relatively industrious low cost labor, including professionals, technologists and middle and low-level skilled personnel. Costs of doing business in Bangladesh are lower. The robust economic growth achieved in Bangladesh (6% +) has resulted from investment-friendly policy and improved investment climate in the recent years.

Bangladesh as an Investment Destination

Bangladesh is strategically located for the global trade with access to international sea ports and air routes and is endowed with abundant supply of the key factors of production like hardworking workforce, natural gas, sweet water, fertile land, favourable climate and social tranquillity. Bangladesh has a sizable domestic market of about 160 million people and there is a great potential for dramatic increase of domestic consumption with continuous and accelerated growth in national income. Apart from the local market, most Bangladeshi products enjoy duty and quota free access to the European Union, USA, Canada, Australia, New Zealand, Japan, other developed countries.

Investment Climate of Bangladesh

  • Bangladesh is a homogeneous country with no religious, ethnic or other forms of cultural conflicts.
  • Bangladesh is an open-market economy, led by a vibrant and innovative private sector which provides the main stimulus to its growth.
  • With robust economic growth, domestic demand is in progressive rise in a country of about 160 million people.
  • Enjoys a strategic geographic location connecting South Asia, South-East Asia and East Asia with wide access to international maritime and air routes. Initiatives are going on to connect the country to regional road and rail networks in the near future.
  • Progressive widening of country’s access to regional and international markets through conclusion of preferential trade agreements.
  • Offers opportunities of high returns at low risk in many sectors due to huge demands and lack of competitions.
  • A huge pool of trained and motivated workforce at a very competitive cost.
  • Very liberal  FDI policy with hardly any restriction on capital and profit movements.
  • Various types of tax and duty exemptions for priority sectors and export oriented industrial units.
  • Goldman Sachs has identified Bangladesh as one of the next big eleven emerging markets.
  • City Investment Research & Analysis has identified Bangladesh with few other countries like: China, India, Indonesia, and Vietnam having the most promising growth prospects.
  • The International Monetary Fund (IMF) termed the economy of Bangladesh as resilient in consideration of robust growths in export and remittance flows.
  • J P Morgan Chase ranked Bangladesh fourth on growth in economically active population.
  • The New York Times has termed Bangladesh as “an unlikely corner of Asia, strong promise of growth”

Investment Incentives

  • Corporate tax holiday of 5 to 7 years for selected sectors and areas
  • Accelerated depreciation on cost of machinery for new industries in lieu of tax holiday
  • Avoidance of double taxation under bilateral tax convention
  • Tariff concessions on import of capital machinery
  • Tariff concessions on import of raw materials of the export oriented industries
  • Bonded Warehousing facility
  • Cash incentives and export subsidies ranging from 5% to 20% on the FOB value of selected products
  • Funds for exports promotion, export credit guarantee scheme
  • Permission for domestic sales up to 20% by export-oriented companies outside EPZ
  • Remittance of royalty, technical know-how and technical assistance fees
  • Citizenship by investing a minimum of US$ 5,00,000 or by transferring US$ 10,00,000 (non-repatriable), permanent resident by investing US$75,000 (non-repatriable)

Investment Opportunities : Key Sectors

There are some business sectors in which Bangladesh has a particular competitive edge and opportunities for exceptional returns on investments. Information and communication technology, infrastructures, textiles, electronics, light engineering, power & gas, ship-building, Business Process Outsourcing (BPO), frozen fish, leather & leather products, ceramics, agro-based industries, pharmaceuticals, tourism, agro-based business, plastic, furniture, home textile, jute & jute products etc.

Textile & clothing

Bangladesh is the second largest textile and clothing exporter in the world, only next to China. Clothing industry is the country’s biggest export earner and Bangladesh produces a wide range of clothing articles: from spinning to weaving, from knitwear to leisurewear and high street fashions. The factories design and produce for the world’s leading brands and retailers.  

For its export-oriented textile and clothing business, Bangladesh needs huge quantity of yarns, fabric, clothing accessories as well as related machinery and packing materials. Investments in these areas could bring substantial profit.

ICT and business services

ICT has been identified as a priority sector in Bangladesh. Government has undertaken numerous measures for the widespread digitization of the country in on hand and for enhancing export of ICT products and services to outside world in the other hand. Because of government’s policy, domestic ICT market is expanding at a rapid pace. Similarly, export of ICT products and software from Bangladesh has witnessed substantial growth in the recent year. In addition, Bangladesh posses a large pool of highly skilled IT professional. Besides, widespread use of English language provides the bright prospects for a robust growth in call centre business. All these make Bangladesh’s target of emerging as a leading global outsourcing centre realistic. The rapidly flourishing ICT sector of Bangladesh provides ample opportunity for win-win cooperation.  

Pharmaceuticals

Pharmaceuticals is one of the fastest growing sectors in Bangladesh. At present, Bangladesh exports different pharmaceutical products to 86 countries including highly regulated US and EU markets. The WTO TRIPS agreement permits Bangladesh to reverse-engineer patented generics to sell locally, and export to markets around the world. This has created a strong manufacturing and technically experienced base with growth of 12% a year and a potential for R&D and clinical trails. The government is in the process of establishing an Active Pharmaceutical Ingredients (API) Park in Bangladesh to further promote the  competitiveness of country’s pharmaceutical sector. Investments in this part could be highly rewarding.

Agro processing

Over 90 varieties of vegetables are grown in Bangladesh. There are huge opportunities for investment in cold storage, vegetable preservation, production of fertilizers and seeds, eco-friendly jute products, shrimp farming, halal foods, milk, value added foods for export –  an endless list.

Leather products

Bangladesh has a mature tanning industry, producing around 2-3% of the world’s leather from a ready supply of raw materials. The finished goods sector is also taking its lead in parallel. With good export incentives plus tariff and quota free access to major markets such as the EU, Bangladesh is an unrivalled location to outsource the manufacture of finished leather products. Soon Bangladesh will emerge as a major exporter of footwear.

Light engineering

Light engineering sector in Bangladesh is growing very rapidly due to high domestic demand and bright export prospects in international market. Abundance in cheap but trained and hardworking workforce make it possible to keep the production cost very competitive. Light engineering sector offers very lucrative profit prospects to the investors.

Electrical, electronic products and home appliances

This sectors offers enormous prospects. Domestic demand for such products are rapidly growing with the substantial growth in per capital income. On the hand, cost competitiveness provides huge prospects for export growth, particularly in the Middle East. Combination of foreign technological innovation and capital with cheap and productive local workforce can open a horizon of endless benefits.

Ship building

This sector offers huge growth prospects. Due to escalation of labour costs in our major ship building nations, this labour-intensive sector in Bangladesh has started gaining competitive edge over others. Bangladesh’s export earnings from this is increasing very rapidly.

And a lot more…

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