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With the dawning of the new century not too far away, Bangladesh
stands poised to enter an era of unprecedented opportunities to
achieve sustained industrial development and technological
progress. The present government has adopted an economic
strategy to create a suitable environment to make Bangladesh a
very attractive destination for foreign investors in the South
Asian region. The Prime Minister, Sheikh Hasina bas given the
highest priority to attracting foreign direct investment into
Bangladesh. She has personally spearheaded the drive for foreign
direct investment through her visit during the past two and a
half years to a number of countries such as United States,
United Kingdom, Germany, Italy, India, Pakistan, China, Hongkong,
Japan, Turkey and Iran. During her visits abroad, her direct
participation in discussions with the leading businessmen of
international repute and the chief executives of industrial
multinationals yielded very fruitful results. The positive
outcome of her dialogue with them is evidenced by the highly
encouraging response from internationally reputed companies to
invest in Bangladesh, especially in the fields of oil and gas
exploration and power generation. During her visits abroad,
Prime Minister Hasina also made a fervent appeal to the overseas
Bangladeshi communities to invest in Bangladesh and become
development partners in the progress of the country.
Bangladesh wants to be an active partner in the world economic
community. It is one of the most open economies among the
developing countries. The Bangladesh economy has already been
liberalized extensively and it is vigorously pursuing a private
sector-led, export oriented growth strategy. The private sector
has been accorded a predominant role in the country's
development. Our policies are geared toward creating an
environment where the private sector can play its role
effectively as the engine for economic growth. The present
government has very clear and well defined economic policies,
geared to promoting foreign direct investment. Like other
developing countries, it actively encourage foreign direct
investment in Bangladesh with a view to creating jobs for our
vast labor force, increasing its foreign exchange earnings,
acquiring new and modern technology and management skills,
accelerating the overall growth and development of the economy
and accessing new market. The present government welcomes
participation of foreign investors in our development efforts.
To this end, the present government pledges good governance,
functionally free convertibility of currency, developing export
processing zones by both the public and the private sectors and
making BOl more responsive fo foreign investment. The government
regards BOl as the key organization in promoting foreign direct
investment in the country. The government has also constituted a
high powered committee to speed up the approval process of the
foreign investment proposals. The BOl has been given the
responsibility to help and assist ail domestic and foreign
investors.
Private investment both local and foreign is welcome in ail
areas with the exception of only rive sectors on strategic
grounds There is no restriction on the amount of investment or
in the share of equity. Full 100 percent foreign investment and
joint venture with local private partners or with the public
sector is freely allowed Foreign investors now enjoy the same
treatment as provided to the domestic investors. Foreign
investors are eligible to take advantage of a wide range of
generous tax incentives, other fiscal incentives & facilities.
The government is giving special importance to building up the
infrastructure in the country. With this in mind a number of
policy initiatives have been introduced to pursue private
participation in infrastructure projects on a Build Operate and
Own (BOO) and Build Operate and Transfer (BOT) models in the
following areas:
a. Power generation,
b. Exploration and exploitation of oil, gas and other mineral
resources,
c. Toll Highways including bridges, expressways and tunnels,
d. Port infrastructure development
e. Industrial parks/Private Export Processing Zones (EPZs)
Recent Measures
Some of the major reforms undertaken by the Government are:
a.Private Export Processing Zone Act. A private EPZ is being set
up at Chittagong by a Korean company with an estimated
investment of $20O million.
b.A permanent Law Reform Commission has been set up to ensure
greater transparency and predictability in the way rules and
regulations are made.
c.An Administrative Reforms Commission has been set up.
d.The company law 1913 has been updated and modernized.
e.The Industrial Relations Act has been amended to enhance labor
market efficiency.
f.Power generation in the private sector has been allowed.
g.Telecommunication in the private sector has been allowed.
h.Multiple entry visas to visiting foreign investors is being
given by all our missions abroad.
i.Provision made for allowing import of standby generator free
of tax, and sale of excess electricity to nearby industrial
units without permission from any agency provided own
distribution line is used.
j.Licenses issued to four cellular telecom phone operators. This
is illustrative of government's commitment to a competitive and
market economy.
Some of the incentives allowed in Bangladesh today are:
(i) The private power companies shall be exempted from corporate
income tax for a period of 15 years.
(ii) The companies will be allowed to import plants and
equipment without payment of customs duties, VAT and any such
surcharges as well as import permit fees except for indigenously
produced equipment manufactured according to international
standards.
(iii) Repatriation of equity along with dividends will be freely
allowed.
(iv) Exemption from income tax in Bangladesh for foreign lenders
to such companies.
(v) The instruments and deed required to be registered under
local regulations will be exempted from stamp duties.
(vi) Due to power generation being declared an industry,
companies are eligible for ail other concessions available to
industrial projects.
(vii) Private parties may raise local and foreign finance in
accordance with regulations applicable to industrial projects as
defined by the Board of Investment (BOl).
(viii) The exemption on capital gains from transfer of shares by
the investing company. 
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General Section
