The Government has recently taken a groundbreaking decision to establish a Specialized Defense Economic Zone. The aim is not merely to meet the military's demand for weapons and equipment but to lay the foundation for a self-reliant defense industry that will one day open a new chapter in export-oriented economic growth.This initiative is undoubtedly taken at a very important time. In this modern world defense sector is no longer confined to preparations for war; it has become a vital arena for technology, innovation and industrial advancement. Drones, cybersecurity system, advanced surveillance tools and smart weaponry are now symbols not only of defense capability but also of technological strength and economic power.
It is the beginning of a new industrial journey in our country. The Bangladesh Economic Zones Authority (BEZA) has recently decided to establish this specialized Defense Economic Zone. BEZA Chairman Ashik Chowdhury stated "We are now working on policy and organizational frameworks. Discussions are ongoing with both local and foreign investors. The goal is not only to reduce import dependence but also to build an export-oriented defense industry."According to preliminary estimates, this project will require a long-term investment of around Tk 15,000 crore. The funding is expected to come from the national budget, public-private partnerships (PPP), joint ventures and foreign direct investment (FDI).Several friendly countries including China and Turkey have already expressed interest in investing in this sector. It is clear that our country is positioning itself for a potential presence in the global defense market.
Why do we need this defense industry? The annual domestic demand for defense equipment in our country is aroundTk 8,000 crore. The Army, Navy and Air Force along with paramilitary forces such as the BGB, Coast Guard, Police, Ansar and VDP are largely dependent on imports. Consequently, a huge amount of foreign currency is spent every year.If a strong domestic defense industry develops in our country, it will not only reduce import dependency but also generate a new cycle of industrial growth within the economy. I think the expanding local production in the defense sector will gradually create a military-industrial ecosystem, where technology, human resources and innovation evolve in interdependence.This would strengthen not only military capability but also the foundation of economic sovereignty.
If we look around the world. The global picture in the defense investment is far high.The defense industry is now a massive component of the global economy.In 2023, the United States invested $11.3 billion in this sector, Germany $3.3 billion, China $2.4 billion, South Korea $621 million, Turkey $600 million, and the Netherlands $258 million.In South Asia, Pakistan invests about $450 million annually, while India spends $2.76 billion.
We still lag far behind in this race. Yet, our economic and human resource potential cannot be underestimated. Even after 54 years of independence, we have not achieved significant success in producing military equipment, whereas many countries with similar economic capacity have already become exporters.
To build such an industry, private sector participation is indispensable. Defense production cannot thrive on government funding alone. However, this is where the main challenge lies. Current defense procurement laws and regulations in our country limit private sector participation. Consequently, foreign investors hesitate due to a lack of legal assurance or guarantees.Therefore, the new policy framework must explicitly include clauses for investment protection, technology transfer and profit repatriation.
If this legal structure is strengthened, leading conglomerates from sectors like textiles, steel, shipbuilding, and electronics could be drawn into defense manufacturing. This would not only transform the defense sector but also pave the way for a broader tech-based industrial revolution.Such integration could trigger a broader tech-based industrial revolution, accelerating the transition from a labor-driven to a knowledge-driven economy. While Tk 15,000 crore may initiate the process, the real success will depend on long-term collaboration, technical training and export market access.
This will be a start for us. But this sector has gone so far. This competitive market is highly dominated by nations like the United States, France, China, Turkey and Israel, where technology and diplomacy work hand in hand.Thus, to enter the export market, we must craft co-operative frameworks based on joint ventures, knowledge sharing and strategic alliances. Without these, a defense economic zone could risk becoming an isolated industrial enclave with limited global reach.
Encouragingly, the Bangladesh Navy has already begun initiatives to build frigates and large sea-going vessels in domestic shipyards. If these ships and equipment can eventually be exported, the investment will become even more appealing.But without export opportunities, production capacity cannot be sustained. Strategic alliances with friendly nations are therefore essential.Forming techno-industrial partnerships with countries like Turkey, South Korea or China could enhance not only production but also export capabilities.
Two high-level committees have already been formed to oversee the development of the defense industry:National Defense Industry Policy Formulation Committee and Bangladesh National Defense Industry Coordination Council. These committees will be responsible for policymaking, investment frameworks and progress monitoring. Currently, the Ministry of Defense is headed by Chief Adviser Dr. Muhammad Yunus, who has placed this initiative high on his priority list.I believe that if transparency, good governance and long-term vision can be ensured in policy implementation, this initiative could become a "game changer" for ourdefense sector.
The defense industry is often viewed through a purely military lens, but its scope today is much wider. Satellite technology, cyber security, robotics, artificial intelligence, sensors, and missile guidance systems - all are now dual-use technologies.The same technologies used in warfare are also applied in agriculture, disaster management, communication and energy sectors.Thus, building a defense industry means not merely producing weapons, but fostering a science-and-technology-driven innovation economy. It will create vast employment opportunities for engineers, technicians, researchers and innovators.
Our defense industry is still in its infancy, but its potential is immense. If the opportunity is seized wisely through effective legal reforms, investment-friendly policies and transparent technology transfer we could emerge within the next decade as a Defense Tech Hub in South Asia.
I dream of the success of the initiative if the following points are met.
First, defense industry by nature requires multifaceted technological diversifications. Only government funding is not sufficient to build a sustainable defense industry.So the engagement of leading industrial groups is important. They will bring expertise, innovation and capital. This public and private participation will stimulate this sector fast.
Second, we international partnerships and technological collaboration can bring fruitful result. Through joint ventures and co-production agreements with advanced nations, we can bridge the technological gap. Technology transfer must not also be one-sided, it should ensure mutual growth and capability sharing.
Third, government support for research and innovation is needed as thefoundation of a strong defense industry lies in research. We should establish an integrated research framework. This framework will include universities, research institutions and private industries. Investment in defense research and development (R&D) should be viewed not as an expense, but as an investment in national capability. Over time, this will yield dividends in the form of economic growth, technological progress and employment generation.
Fourth, a long-term strategic plan should be taken.The real objective should be to create an export-oriented and diversified industrial ecosystem. Priority sectors such as drones, and smart weapon systems must be clearly identified with time-bound targets.
Self-reliance in defense is not merely a question of strategic security; it is also a symbol of economic independence.If we succeed in this endeavor, it will not only strengthen our military capability but also steer us toward an innovation-driven economy.Just as South Korea transformed itself into a global technological powerhouse through defense-linked innovation, we too can turn defense technology into a new engine of economic advancement.The only question is - are we ready to turn this vision from dream to reality?
The writer is a banker
