Reasons to invest
1.PERFECT WEATHER CONDITION
In Bangladesh, we don’t have extreme temperature changes. We have six seasons: Summer, The Rainy season, Autumn, Late Autumn, Winter and The Spring.
PRINCIPAL SEASONAL CROPS AND FRUITS
Paddy, jute, wheat, tobacco, pulses, oil seeds, spices, vegetables, jack-fruit, banana, mango, coconut, pineapple etc.
Bangladesh has experienced growth rates of approximately 7 percent over the last few years. Compared to the rest of developing countries in Asia, with the regional economic powerhouses India and China, Bangladesh has fallen behind on GDP per capita measured in Purchasing Power Parity (PPP) and the gap is projected to widen Here, Bangladesh is more comparable to a Sub-Saharan African country.
The transport system of Bangladesh consists mainly of three modes. As the country is a flat plain, all three modes are of surface transport, i.e. roads, railways and inland waterways which are widely used in carrying both passengers and cargoes. Besides, operations of two seaports, maritime shipping and civil aviation catering for both domestic and international traffic are extensive and effective.
We’ve committed and devoted resources of sustainable utilities infrastructure that goes from having powerful, reliable and extensive energy supply network (both from traditional and renewable sources of energies such as geothermal, bio-gas, solar panel etc.) to promoting the establishment of strategically located industrial parks and business centers.
In the last decade Bangladesh with its sustained economic growth, has managed to continue growth in overall communication sector. About half of the total population use internet. Bangladesh has experienced a surprising growth in mobile phone subscriptions which is about 140 million out of 160 million total populations.
According to the survey Report on labor force survey 2016, the labor force increased from 49.5m in 2006 to 53.7m in 2009 and 63.5 in 2016. The growth rate has been 2.7% a year. 66% of the population are of age 15 years and over and out of them 59.3% are economically active and 40.7% are economically not active.
7.Ease of Doing Business
Doing Business, a World Bank Group flagship publication, is a series of annual reports which measures the regulations that enhance a country’s business activities and those that constrain it. Doing Business presents quantitative indicators on business regulations and the protection of property rights that can be compared across 190 economies. A high Ease of Doing Business ranking indicates a more favorable regulatory environment for starting and operating business in that particular country. Doing Business captures several important dimensions of the regulatory environment as it applies to business enterprises, providing quantitative indicators on regulation for the following: Starting a business, Dealing with construction permits, Getting electricity, Registering property, Getting credit, Protecting minority investors, Paying taxes, Trading across borders, Enforcing contracts, Resolving insolvency.
The Foreign Investment Act of 1980 guarantees the right of repatriation of invested capital, profits, capital gains, post-tax dividends, and approved royalties and fees. Foreign firms are able to repatriate funds without much difficulty, provided the appropriate documentation is in order.
Information about Investment incentives:
Foreign investment or joint venture investment in the Export Processing Zones (EPZs) or outside EPZs (with the exception of the five industries mentioned earlier).
- Portfolio investment by purchasing shares in publicly listed companies through the stock exchange.
- Investment in infrastructure projects such as power generation (private power generation policy announced); oil, gas and mineral exploration, telecommunication, ports, roads and highways.
- Outright purchase or purchase of shares of state-owned enterprises, which are under process of privatization.
- Investment in private EPZ (Private EPZ Act recently passed).
- Agri-input sectors like seed, fertilizer, Pesticide, irrigation & Farm Machinery
- Post-Harvest infrastructure
- Food processing like eligible oil, rice, sugarcane, potato, fruits & vegetables & spices
- 100% foreign equity is allowed (Except for defense, nuclear energy, currency and forest plantations)
- Tax incentives for 5-7 years based on location and industry dependent
- Cash Incentives: electricity consumption special rebate of 20% to agro-processing sector
- Tariff-free access to European union
- Cash incentives and export subsidies for selected export products ranging from 5% to 20%
- Loan disbursement target in agriculture is USD 2 Billion
- Entrepreneurs Equipment Fund is allowed agro-sector
- More than 47.5% of population dependent on agriculture for livelihood
2.GARMENTS & TEXTILES
If you wish to set up an operation in Bangladesh, your best contact point is the Office of the Bangladesh Investment Development Authority (BIDA), which operates under the Prime Minister’s office and is the principal government agency for encouraging investment.
Over 800 IT companies are now thriving in the country and capturing a significant share in the international markets worldwide.
- Total estimated IT Industry Size is US$ 120 Million (including export)
- Software contributes around 44% to the overall industry revenue, whereas ITES contributes around 56% to the overall industry revenue.
- Approx 30000 professionals, majority IT and other graduates, are employed in the industry. In terms of creating high-quality employment software and IT service industry is surely one of the top graduate employment sectors in the country.
- Total investment in this sector is more than 50000 crore and this sector is the largest contributor to FDI in Bangladesh.
- Online outsourcing, data entry and call center business are flourishing.
- In the next 5 years, 1% of the country’s total GDP will come from the software and IT services sector.
4.Leather and Leather Goods
Bangladesh has a long established tanning industry which produces around 2-3% of the world’s leather from a ready supply of raw materials. The country is therefore an established and attractive location to source and outsource the manufacture of finished leather products. The leather industry is ideally suited to Bangladesh with its abundance of labor and natural resources at internationally competitive rates.
- Global Electrical and Electronic products are highly branded. Bangladesh is producing mostly for the domestic market.
- Bangladesh encourages private sector investment with 100% foreign ownership.
- Approx USD 9bnmarket demand while local production approx. USD 1bn
- More than 3000units are in operation, creating employment (direct and indirect) 1 million & 0.4 million
- Major Import substitution opportunity exists
- Middle-class consumers of Bangladesh consist population more than Malaysia, Singapore, Thailand
- The average growth rate of plastic production is more than 20% per year.
- 300 manufacturers, export plastic goods worth nearly USD 98.995 million in the FY 2015-2016.
- Currently, around 5000 companies are operating in this sector of which 98% of them are SME’s.
- Direct & indirect employment to over 1.2 million people in Bangladesh
- Annual sales at around BDT 150 billion in the local market, in which household items account for nearly BDT 20 billion.
- The plastic sector constitutes 1.0 of total GDP
- Strong backward linkage sectors, such as light engineering sector in BD etc.
- Enabler of innovation of many products and technologies like packaging, textile, healthcare, construction, electronics, energy generation automotive.
7.Light Engineering Sector
- 40,000 light engineering workshops/enterprises operating. About one million people and innovative entrepreneurs are actively engaged
- Annual turnover is US$ 1600 million of which Import substitute products is around US$ 200 million
- Over 90% of light engineering industries are serving the local needs of the people.
- 10% cash incentives for export
- Availability of trainable labors at competitive cost
- Declared as special development sector in its Export Policy
8.Ship Building Sector
- Number of Companies: 130
- Ships made in Bangladesh are 15% cheaper than even Chinese ships and are of the same quality
- The productivity of labors is good & average hourly labor charge in is only US$ 1.00
- Global shipbuilding market size is US$ 1,600 billion. 1% of the global order for only small ships market the amount will be worth US$ 4 billion for Bangladesh
- Present capacity is 0.84% of global shipbuilding production
- Declared as “Thrust Sector” in a different policy.
- 5 %t incentive on export
- Tourist spots the country such as Cox’s Bazar, Kuakata, Kantajee Tample, Saint Martin’s Island, Sonargoan, Sylhet, Sundarbans, Ramsagor, and so on have attained huge number of tourist
- About half a billion USD was earned from the tourism sector in 2017.
- People of Bangladesh are very hospitable and tourist friendly.
- Unique archaeological sites, cultural heritage and eco-tourism products like the world’s largest mangrove forest, the Sundarbans, the world’s longest unbroken sea beach in Cox’s Bazar (120km), the oldest archaeological site in the Southern Himalayas-Paharpur and world’s largest terracotta temple – Kantaji Temple in Dinajpur, and spectacular monuments and mausoleums of language movement and liberation war of the country.
- The WTTC predicted that by 2023, travel and tourism will directly generate 2 million jobs and support an overall total of 4 million jobs, or 4.2 percent of the country’s total employment.
- This would represent an annual growth rate in direct jobs of 2.9%.
- Bangladesh’s world ranking in 2017 was 173 out of 185 (for diverse contribution to GDP).
10.Renewable Energy Sector
- Economic growth of 7% calls for the scalability of its power infrastructure to keep up with the demands of industry and increased urbanization.
- Currently, renewable energy makes up 2.5% of the total electricity generation
- The importance of an alternative source of energy in Bangladesh.
- Solar energy is the most prominent source of renewable energy
- Successfully implemented one of the biggest Solar Home System (SHS) projects
- Around 3 million SHSs have been successfully installed
- Hydro power, Micro, mini and pico hydro power plants can also be used
- The global ceramics industry is worth more than $10bn.
- Bangladesh produces a high-quality bone china.
- Bangladesh exported to about 55 countries, amounting to about USD 376 million in 2015-16
- The export destinations are EU, USA, Italy, Spain, France, New Zealand, the Netherlands, Australia, Sweden and the Middle East.
- 54 ceramic manufacturers are operating in Bangladesh, creating employment of 0.5million.
- Investment in this sector is worth USD 462 million with the possibility of expanding.
- Demand is USD 250 million & Bangladesh produced USD 233 million worth products in June, 2017.
12.Medical Equipment Sector
- The medical device market is projected to USD 243.6 million in 2018
- Hospitals in Bangladesh experienced up to 22.5% growth in patients in 2011
- The large medical equipment market of Bangladesh is almost import dependent
- Medical equipment manufacturing is a potential sector to invest and set up plants in Bangladesh
- Huge private hospitals in recent years represent the best opportunity for selling expensive high-end equipment and medical devices.
- Government builds hundreds of new healthcare facilities and upgrades existing facilities and equipment.
13.Health Care Sector
- Around Two Billion Dollars of the untapped Healthcare, the market is now in Bangladesh.
- Bangladesh spends around 2.04 billion US dollars abroad for medical treatment in a year. This amount is 1.94 percent of total GDP of Bangladesh.
- The demand of Health Care growing 21% annually.
- The demand for health care services is accelerating because of increasing purchasing power of the growing middle and upper middle classes.
Bangladesh Investment Development Authority
Contact: +880 2 55007241-45,
Fax: +880 2 55007238-40,
Email : email@example.com
Bangladesh - BIDA Newsletter July-September 2020 no.10
Bangladesh - Investment Handbook-A Guide for Investors
Bangladesh - Sector Profile Construction Material Industry
Bangladesh - Sector Profile Information Technology Industry
Bangladesh - Sector Profile Motorcycle & Parts Industries
Bangladesh - Sector Profile Shipbuilding Industry
Bangladesh - Annual Report 2018-19 of BIDA