Small Business Resources
Comparative advantages for investment in Bangladesh
Bangladesh has the following comparative advantages for foreign investment over other Asian
countries:
Bangladesh has the following comparative advantages for foreign investment over other Asian
countries:
Low cost easily trainable labour is abundantly available in Bangladesh. Out of the total
population of 127 million, the labour force comprises more than 50 million.
Bangladesh is one of the three Asian countries (the other two being Sri Lanka and China)
which offers unconditional 100 percent foreign equity or ownership in industrial
investments.
Inflation rate is the lowest (1.3 percent) among the Asian countries.
There is no restriction on issuing work permit to a foreign national.
Bangladesh is most liberal in granting permanent residentship and citizenship to
foreigners. A non-repatriable investment of only US $ 75.000 in an industrial project is the
only condition of granting permanent residentship and a minimum investment of US $ 500.000
or transferring US $ 1,000.000 to any recognized financing institution which should be
non-repatriable, is the condition for granting Bangladesh citizenship.
Tax holiday allowed for new investment in Bangladesh is the minimum 5 to 9 years in most of
the areas on some conditions, and 12 years in special economic zones (in the Chittagong Hill
Tracts).
Bangladesh enjoys Most Favoured Nation (MEN) status from a number of countries including
the U.S.A. with whom bilateral treaty of trade and investment has been signed. The countries
with which Bangladesh so far signed bilateral investment treaties are USA, UK, Germany,
Romania, Belgium, Republic of Korea, Thailand, Turkey, France and Italy.
As one of the least developed countries, Bangladesh enjoys Generalized System of Preference
(GSP) facilities for favorable export to the U.S.
Avoidance of double taxation agreements have been signed with Japan, U.K., Italy, Canada,
Sweden, Malaysia, Singapore and the Republic of Korea.
Legal protection to all foreign investments in Bangladesh is provided by an Act n of
Parliament passed in 1980 against nationalization and expropriation. Non-commercial risks of
investment in Bangladesh are also covered by the Multilateral Investment Guarantee Agency
(MIGA),
Foreign Exchange regulations have been relaxed to the maximum limit by the recent
introduction of free convertibility of Taka, the Bangladesh currency. This has accelerated
the free flow of international business transactions
Repatriation of foreign capital investment along with profits/dividends has been made easy
and simplified. Now no prior permission of any authority is required for such repatriation.
Cost of land and energy prices are one of the lowest in the region, There is a huge proven
and recoverable deposit (about 11 trillion cubic feet) of natural gas in Bangladesh. A
potential reserve of 50-70 trillion cubic feet is known.
Bangladesh h as two seaports with modern facilities. Internal transport and communication
system has vastly improved over the years.
Most importantly, Bangladeshi people are hospitable, friendly and resilient and greatly
value the role of foreign investment in their country.
