Bangladesh: the land of opportunities

Bangladesh has proved to be a resilient and attractive investment destination even in thick of a severe global economic downturn. New opportunities are emerging for foreign investors in Bangladesh everyday. We are poised to achieve at least 6% GDP growth despite the worldwide slowdown. Bangladesh can be your top choice for offshore investment including relocating industries.
We offer a strong local market, greater global market access and proven export competitiveness. Bangladesh's seaports, historically, had been "ports of call" of ancient traders, and hub of economic activity connecting the West and the Far East. Today we are witnessing Bangladesh's resurgence as a regional hub. Bangladesh occupies a strategic location as a bridge between South and South-East Asia and beyond.
Despite the global economic crises, Bangladesh has registered consistent GDP growth during the past decade. Its favorable investment climate has been lauded by many around the world. Bangladesh has been listed in Goldman Sachs' 'Next 11' and JP Morgan's 'Frontier Five'. Standard and Poor (S&P) as well as Moody's have placed Bangladesh ahead of all countries in South Asia, except India.
The government of Prime Minister Sheikh Hasina is committed to sustainable growth and poverty reduction to achieve the goals and targets envisaged in the "Vision- 2021". Bangladesh recognizes foreign investment as the key drive and catalyst of economic growth and development to build the envisioned 'Digital Bangladesh'. The government has recently announced Public-Private Partnership (PPP) opportunities in industrial and social infrastructure sectors to develop strategic relationship with investors. A billion dollar credit agreement has been signed with India recently for infrastructure development including communication and transport sectors, and facilities at sea ports.
WHY BANGLADESH?
Industrious low-cost workforce: Bangladesh offers an educated, highly adaptive and industrious workforce with the lowest wages and salaries in the region. 57.3% of the population is under 25, providing a youthful group for recruitment. The country has consistently invested in developing a skilled workforce catering to your needs. English is widely spoken, making communication easy.
Strong Local market and growth: Bangladesh has proved to be an attractive investment location with its 142 million population and consistent economic growth leading to strong and growing domestic demand. It is striving to establish a strong regional connectivity among the immediate neighbours. Already agreement on connectivity has been reached between Bangladesh, India, Nepal and Bhutan, opening opportunities in the huge next door markets.
Low cost of energy and land: Energy prices in Bangladesh are most competitive in the region. Transportation on green compressed natural gas is less than 20% of the diesel price. Many multinational companies have already invested in gas exploration in Bangladesh. The cost of land is also the lowest in the region.
Proven export competitiveness: Bangladesh enjoys tariff-free access to the European Union, Canada, Australia and Japan. It enjoys GSP facilities as an LDC for export to the USA.
Competitive incentives: Bangladesh offers the most liberal FDI regime in South Asia, allowing 100% foreign equity with unrestricted exit policy, remittance of royalty and repatriation of profits and income.
Export and Economic Zones: Bangladesh offers export-oriented industrial enclaves with infrastructure facilities and logistical support for foreign investors. The country is also developing its core infrastructures, including roads, highways, surface transport and port facilities for a better business environment.
[A separate write-up with details about the prospects and opportunities for investment in Export Processing Zones is also published in this supplement].
Positive climate: Bangladesh has a largely homogenous society with people living in harmony irrespective of race and religion. Bangladesh is a democracy enjoying broad bi-partisan political support for private investment; there is political stability and an effective containment of extremism. It offers 100% foreign equity or ownership in industrial investment. Foreign exchange regulations have been relaxed to the maximum limit and its currency (Taka) has been made free to convertible. Repatriation of foreign capital alongwith profit/dividends has been made easy and simplified. There is no restriction on issuing Work Permit to a foreign national. Board of Investment (BOI) offers one stop service to investors.
Direct supervision of Prime Minister's Office (PMO): All the major organizations dealing with investment, such as BOI, BEPZA, etc., have been kept under direct supervision of the Prime Minister to ensure timely services, easy process and to address bottlenecks if and when they arise. BOI offers one-stop service for investment.
Legal Protection: An Act of Parliament passed in 1980 guarantees legal protection against nationalization and expropriation. Non-commercial risks of investment are also covered by the Multilateral Investment Guarantee Agency (MIGA). Agreements on Avoidance of Double Taxation have been signed with many countries including Japan, U.K., Italy, Canada, Sweden, Malaysia, Singapore and the Republic of Korea. Some more such agreements are being negotiated.
KEY SECTORS
Information & communication technology, infrastructures, textiles, electronics, light, engineering, power, oil & gas, ship-building, green technology, frozen foods, leather & leather products, ceramics, agro-based industries, pharmaceuticals, tourism etc are the key sectors for investment in Bangladesh.
OPPORTUNITIES
There are some business sectors in which Bangladesh has a particularly competitive edge and gainful investments opportunities for exceptional returns. These range from ship-building to ceramics; from float glass to tourism. Some of your key opportunities are:
Quality garment design and production
From spinning to weaving, from knitwear to leisurewear and high street fashions, the textiles and clothing industry is Bangladesh's biggest export earner and Bangladesh is now the number two in the world after China in respect of market share of ready-made garments. Our factories design and produce for the world's leading brands and retailers. Quality products on time, reliably.
Talented ICT and business services
From inbound call centres to the latest in Web 2.0 software development, widespread English helps make Bangladesh an emerging option for the global business service industry. Our promising ICT sector ready to win your over.
Competitive pharmaceuticals
The WTO TRIPS agreement permit 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 trials.
Agro processing
Over 90 varieties of vegetables are grown in Bangladesh. There are huge opportunities for investment in cold storage for export produce, production of fertilizers and seeds, eco-friendly jute products, shrimp farming, halal food, milk, added-value 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. 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.
Infrastructure, Power and Energy
The government is committed to develop necessary infrastructural facilities to facilitate foster industrialization. Emphasis is given on power and energy, economic zones, highways and expressways, ports, tourism, telecom and ICT infrastructure, waste management, water supply and other infrastructure projects.
Power sector is on the forefront of all infrastructural projects. Special incentives in this sector include, 15 years tax holiday, exemption of import duties, value added tax (VAT), surcharges and import permit fees on imported plants, equipments and spare parts up to ten percent of the original value of total plant and equipment within a period of twelve years of commercial operation. Incentives also include exemption of tax on foreign lending, foreign loan interests, royalties, technical know-how and assistance fees, free repatriation of equity and dividends etc.
ATTRACTIVE INVESTMENT INCENTIVES
-- Corporate tax holiday (Outside EPZs) : 5 to 7 years for selected sectors
-- Accelerated depreciation on cost of machinery for new industrial in lieu of tax holiday
-- Reduced Corporate Tax for 5 to 7 years in lieu of tax holidays and accelerated depreciation
-- 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 facilities, etc.
-- Cash incentives and export subsidies ranging from 5% to 20% on the FOB value of selected products
-- Funds for export 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 and permanent resident permits on investing US $75,000
-- And many more
[For details about investment opportunities in Bangladesh please visit the websites of Board of Investment and Bangladesh Export Processing Zones Authority, BEPZA of Bangladesh at Board of Investment: www.boi.gov.bd, BEPZA: www.epzbangladesh.org.bd]