Foreign Investment in Bangladesh

Private investment from overseas company or individual are welcomed in all sectors of the economy with the exception of only five sectors which are reserved for public sector. Such investments can be made either independently or through joint venture on mutually beneficial terms and conditions. In other words, 100% foreign direct investment as well as joint venture both with local private sponsor or with public sector is allowed.

Foreign investment is specially desired in the following categories:

Export-oriented industries;
Industries in the Export Processing Zones;
High technology products that will be either import-substitute or export-oriented;
Undertaking in which more diversified use of indigenous natural resources is-possible;
Basic industries based mainly on local raw materials;
Investment towards improvement of quality and marketing of goods manufactured and/or increase of production capacities of existing industries;
and Labour intensive/technology intensive/capital intensive industries.

Public / Reserve Sector:

Public sector investment are included in the Reserve Sector. These are:

Arms, ammunitions and other defence equipment and machinery;
Production of nuclear energy;
Forest plantation and mechanized extraction within the bounds of reserved forests
Security printing (currency notes) and minting; and
Air transportation and railways.

Facts of Bangladesh as an investment destination:

i) Bangladesh has never defaulted in its debt-service liabilities to mufti-lateral and bilateral donors.
ii) Bangladesh grow over 25 million metric tons of food grains, basically rice and some wheat and potatoes which is enough to feed 150 million people of the country, and for building reserve stocks.
iii) Bangladesh never experienced negative growth after it’s independence.
iv) Bangladesh exports ready made garments, knitwear, brand name wind cheaters, walking shoes, leather goods, shoes and other products, urea fertilizer, pharmaceutical, shrimps and prawn, vegetables, jute and jute products etc. to sophisticated markets of EU, USA, Japan and many other countries.

Attractive investment destination:

Following are some positive aspects which make Bangladesh an attractive location to foreign investors:

i) We have opened up our economy with rapid liberalization of import policies helping globalization of our economy;
ii) According to a Survey of the Economist-risk factors for FDI in Bangladesh are minimum compared to many other countries of this region;
iii) Cost of production especially cost of labor both skilled and semi-skilled is comparatively lower;
ix) Cost of living is also quite low and reasonable and there is no communal or ethnic problems;
v) English language is widely spoken and understood;
vi) Working capital loan as well as term loan from local commercial banks allowed to the industries setup with foreign capital;
vii) Citizenship by investing a minimum of US $5,00,000 or by transferring US $10,00,000 to any recognised financial institutions (non-repatriable);
viii) Permanent residentship is granted to an expatriable by investing a minimum of US $75,000 (non-repatriable);
ix) Avoidance of Double Taxation Agreements and Bilateral Investment Promotion Treaties have been signed with many countries including U.K.