Bangladesh Prime Minister Sheikh Hasina on Wednesday said her country had the most liberalised investment regime in the region as she tried her best to sell the investment potential of her country and rolled out a red carpet for India Inc.
“Our country has the most liberal investment regime in the region with a wide array of facilities, attractive incentive policies, and consistent reforms,” she said while attending a programme organised by the Federation of Bangladesh Chambers of Commerce and Industry and the CII.
In her attempt to showcase the Bangladesh government’s commitment to encourage investment and rapid economic development, Hasina said that 100 special economic zones and 28 hightech parks were being established in the country, out of which at least two SEZs were being earmarked for Indian investors.
It was clear from the pitch of Hasina, who met Adani Group chairman Gautam Adani on the first day of her visit, that the Bangladesh government was keen on expanding the scale and the scope of business relationship with India as part of its strategy to accelerate the country’s economic growth rate.
Over the last decade or so, the performance of the Bangladesh economy — which grew at a rate of over 6 per cent per annum — and its achievements in the field of human development has often been called a development miracle by several leading economists. Although the pandemic and Russia’s attack on Ukraine have had a negative impact on the country’s economy as the rate of growth slowed down and the country’s foreign exchange reserves dwindled, the outlook for Bangladesh — expected to graduate from the list of the UN’s Least Developed Countries in 2026 — still remains positive.
As the graduation will expose the economy to an entire gamut of new challenges — like loss of LDCspecific international support measures (ISMs) such as preferential market access that will hit exports to European and North American markets — Hasina seems to be preparing in advance. “Indian investment (in Bangladesh)... would bring economic prosperity to the region,” Hasina said, stressing that the two countries hadn’t explored the true potential of economic cooperation.
She also outlined the areas where India Inc can put its money. “I would urge Indian investors to consider possible investments in infrastructure projects, manufacturing, energy and transport sectors.”A source in Bangladesh said the focus of the government was to create incentives so that more investment — especially in areas like infrastructure — flowed into Bangladesh. “The total amount of FDI inflow to Bangladesh was $1.37 billion in 202122, out of which India’s contribution was only $15.751 million, little over 1 per cent... Given the proximity and the kind of relationship we share, it can surely go up,” said the source.
Greater economic cooperation is also aimed at reducing the trade imbalance between the two countries. In 202021, two-way trade between the countries stood at $9,873.17, out of which Bangladesh’s export to India was only $1,279.67. The imbalance in trade has been a pet peeve for the Bangladeshis, which they think can be addressed through a comprehensive economic partnership agreement, discussions for which are likely to begin this year. “The India-Bangladesh relationship’s dynamics have changed from what used to be a zero-sum game during earlier regimes to a win-win formula under the leadership of Sheikh Hasina... She has the vision to take this relationship forward and we expect the visit will result in greater economic cooperation between the two countries,” said Salim Mahmud, information and research secretary, Bangladesh Awami League.
