Sunday, March 8, 2020

Foreign Direct Investment Policy

Its a liberal investment policy, there are very few restrictions on foreign ownership of businesses or property in Bangladesh.

FDI comprises an overwhelming part of the economy of Bangladesh in its contribution to Gross Domestic Product (GDP), export and domestic investment as well as overall economic growth. FDI inflows have traditionally been in the form of equity, reinvestment and intra-organisation acquisitions. While there are generally very few restrictions on FDI, private sector investment is prohibited in the following sectors: arms and ammunition, defence, forest plantation, extraction of reserved forests, nuclear energy, security printing and mining.

Furthermore, the following sectors will require investors to obtain licenses before they are able to commence business: banking, finance, insurance, telecommunications, aviation and broadcasting. Foreign investors that wish to acquire stakes in local companies will need to obtain approval from the Bangladesh Bank if the control of the business is subsequently transferred to foreign shareholders.

Government incentives

Alongside the incentives outlined in the tax section, the government provides cash assistance and other incentives for doing business in Bangladesh in certain export-oriented industries. Cash incentives are available in the following sectors, with different cash incentive rates:

• Textile

• Agro products

• Bicycle

• Crashed bone

• Poultry

• Light engineering products

• Liquid glucose used in agro product

• 100 per cent Halal meat

• Frozen shrimp & other fish

• Leather

• Ship export

• Finished leather

• Crushed leather

• Plastic pet bottle

• Jute products


Bangladesh’s imports mostly comprise petroleum and oil (11 per cent of the total imports), textile (10 per cent) and food items (nine per cent). The import regime comprises: a banned list, a restricted list, freely importable items and certification requirements for all food products. All other permitted imports require a Letter of Credit Authorisation to be completed.

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