Bangladesh woos foreign investors
Last week's Bangladesh Business Summit-2023 in Dhaka was seemingly able to make some foreign investors jostle for a place in the country that is offering, by some counts, $100 billion investment opportunities at the present time.
Already on the threshold of obtaining a developing country's status by 2026, Bangladesh aims to be an upper middle-income state by 2031 and a developed one by 2041. Imagine if all these mind-boggling ambitions go hunky dory, we all will be enjoying a life akin to any Western countries that we could at the current situation only daydream.
If something is in the conceptual stage, it may look impossible initially to materialize. But there is always someone to make it possible. In the case of Bangladesh under the dynamic and foresighted leadership of Sheikh Hasina, hopes are looming large for a developed nation in the foreseeable future with the country hurtling into the fourth industrial revolution after entering into the 'Smart' age from the digitalized one.
By aiming to become an industrialized nation, Bangladesh has zeroed in on foreign direct investments (FDIs) that along with money bring cutting-edge technology, expertise and modern production techniques and all these are necessary ingredients for industrialization.
Large scale investment commitments came from Saudi Arabia and China. Three memorandums of understanding (MoUs) were stamped with the Kingdom in the presence of its Commerce Minister Majid Bin Abdullah Al-Qasabi for developing the Rangpur Sugar Mills and Patenga Container Terminal. Another deal worth around $3 billion has been on the anvil with Saudi energy developer ACWA Power which is likely to generate 5,000 employments. Another MoU was signed with China for infrastructure development.
Why have foreigners showed keen interest in investing in Bangladesh? The first and foremost reason is its tremendous infrastructure development including 100 economic zones at an estimated cost of $40 billion. Dhaka has revolutionized its connectivity with the recent construction of the Padma Bridge and other hundreds of bridges and culverts and a modern network of roads and highways.
Along the Padma Bridge, by the next year, there will be 32-km rail way line and test run for that has already been completed. It will be part of the 172-km long rail link project from the capital Dhaka to Jashore via Padma Bridge. Most recently, Bangladesh entered a new age of connectivity as country's first-ever elevated metro rail became operational in Dhaka. After the metro rail, Dhaka city is going to have the country's maiden underground metro rail which will be running at a depth of 10 to 30 metres beneath the surface by 2026. Bangladesh will also very soon witness another miracle in its communication systems with the completion of the first-ever under river Bangabandhu Sheikh Mujibur Rahman Tunnel under the Karnaphuli river.
Another big economic breakthrough is the construction of the country's first-ever Deep-sea Port at Matarbari which is expected to go on the stream by 2026. Apart from the deep sea port, there will be a coal-fired power plant in Matarbari and construction of which is nearing completion. Bangladesh is also going to have the first-ever Rooppur Nuclear Power Plant which will be the largest power project in the country until now.
There are many other large scale projects some of them are in the implementation process and some others are in the pipeline. They include Dhaka, elevated expressways, Chittagong Elevated Expressway, Dhaka Airport expansion project, Dhaka-Chittagong high-speed railway, Chittagong-Cox's Bazar railway line and Chittagong Circular Railway.
Another key reason for the scramble of foreign investors is the development of 100 economic zones which are offering a package of incentives such as a 100 per cent income tax exemption for 10 years on capital gains, dividends, royalties, and technical assistant fees and an 80 per cent exemption on value-added tax on electricity, water and gas consumption.
Apart from this, Bangladesh is becoming one of the largest consumer markets in the Asian region with a population of 170 million. Not only that, Bangladesh has an advantage of its close proximity to other neighbouring countries of over one billion consumers. Its per capita income increased to nearly $3,000. Remarkable achievements have been made in GDP growth, poverty reduction, literacy rate, healthcare services, communications, RMG sector and other economic areas. All this has suggested that Bangladesh's economy has been progressing fast that earns it many gongs and kudos worldwide.
But under the gloss all is not well. Corruption, cronyism, red-tapism and labyrinthine regulations are widely considered major factors discouraging investments. It needs to run from pillar to post by visiting at least 17 government agencies and authorities to receive an industrial license. The recent crisis in gas and power supplies is adding to woes severely hampering production.
The government should give a serious thought to ease 'doing business' by tightening the noose on corruption and by introducing a favorable policy regime and a friendly investment climate in the country. Otherwise, all government efforts to attract foreign investments will not live up to the expectations.
The writer is a senior journalist