“investing and doing business in bangladesh”©bangladesh investment development authority...
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©Bangladesh Investment Development Authority
“Investing and Doing Business in Bangladesh”
©Bangladesh Investment Development Authority
The World’s
44th
Largest Economy Ranked by World Bank and will be
23rd
largest economy by 2041
2ndin RMG Export after CHINA
Economic Indicators (2016)
GDP Growth Rate (Last 10 years) 6% - 7%
GDP Size (2017-18) $285 Billion
GDP Growth (2016-17) 7.28 %
Per Capita GDP $ 1,754
Share of Investment to GDP 30.3%
Source: Bangladesh Economic Review 2016, Ministry of Finance, World Bank, Digital Year Book 2016
Economy of Bangladesh: Overview
2
Poverty rate
dropped to
12.9% from
44.2%
Each year
Bangladesh
creates
around 1.2
million jobs
Export
reaches to
37 billion in
from 16
billion in
FY10
FDI jumps to
2.15 billion in
FY17 from
1.2 bil in
FY10
Source: World Development Indicators, World Bank and 7th five year plan, GoB
©Bangladesh Investment Development Authority
To become a Middle Income Country by 2021 and developed country by 2041 we
need to move faster…
Growth Story of Bangladesh
Parameters What we were As of now
Per capita (USD ) 129.71 (1971) 1754 (2017-18)
Population under the poverty line 82% (1970) 18.5%
Literacy Rate 29.23% (1981) 70% (estimated 2015 )
Female Literacy Rate 27(1971) 77% (estimated 2015 )
GDP growth 4.62% (1976) 7.24%
Export (USD ) 0.4bn (1976) 36.66 bn (2017-18)
FDI (USD ) 7 million (1977) 2152 million (2017)
Forex Reserve (US$) 7.50 bn (2009) 32.40 bn ( April ’2018)
Electricity Gen. Capacity 3362 MW (2009) 15,351 MW (March, 18)
(Mx. Gen. 10,084 MW)
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©Bangladesh Investment Development Authority
Vision
2021Vision
2041
GDP Growth 8% 8%
Visions to grow…
Per Capita Income $ 2000 $ 12600
Investment to GDP 34.4% 36%
Share of Industry to GDP 34% 40%
FDI $9.56 billion $153 billion
Infra Investment $100 billion $1150 billion
Economic Status Middle Income High Income
GDP in Value $335 billion $2580 billion
Export earning $70 billion $350 billion
4
©Bangladesh Investment Development Authority
SDGs: financing…
5
$928.48 billion requires from 2017 to 2030 to implement the SDGs:
• Private sector financing (42.09%),
• public sector financing (35.50%),
• public-private partnership (PPP)
(5.59%),
• external financing (14.89%) of which:
• foreign direct investment (9.95%),
• foreign aid and grants (4.94%)
• non-government organization (NGO)
(3.93%).
Annually USD 66.32 billion
needed…
Potential sources of gap
financing per annum are:
©Bangladesh Investment Development Authority
“Bangladesh one of
the Frontier five
economies- “JP
Morgan
“Bangladesh the
Next China”
Mckinsey &
Company
“Bangladesh will be the 12th
economic power of the world in
2050” UBS.
How does World behold Bangladesh?
“28th &23rd largest economy of World
by 2030&by2041” PwC
“Low cost and high
return Manufacturing
destination in Asia”
JETRO
“The Next Eleven (N-11),
Bangladesh one of 11
nations, have high
economic potential”Goldman Sachs
6
©Bangladesh Investment Development Authority
Big name in Business World already in Bangladesh
7
©Bangladesh Investment Development Authority
Investment in Bangladesh is secured by law against nationalization and expropriation.
Local and Foreign investment is given equal treatment
100% foreign equity is allowed along with unrestricted exit.
Almost all industrial sectors are open for foreign investors for investment
Bangladesh never posted negative economic growth during the past 30 years
• Bilateral Investment treaties (BITs) signed with 31 countries
• Double taxation treaties (DTTs) with 28 countries:
• Bangladesh is a signatory to ICSID, UNCITRAL, OPIC, MIGA, WAIPA, WIPO and WTO.
• All laws, regulations are conducive to investment
• Bangladesh is making all out reforms in Ease of Doing Business (EODB) to attain
double digit ranking by 2021
Investment climate of Bangladesh
8
©Bangladesh Investment Development Authority
Opportunities Unbounded
In this growing Bangladesh, investment opportunities are unbounded, diverse and long-term
Competitive Services
IT & ITES, BPOs Logistics, Health
SkillsEducation,
Training, HR development
InfrastructureCommunication, Energy, Power, Ports, Economic
Zones
ManufacturingCompetitive
Manufacturing supporting global
value chains
All Modes of Investments
100% FDI
Joint Ventures
Partnerships
PPPs
Non-equity modes(Technology transfer, licensing
Franchising, Contracting etc)
• Foreign Lending
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©Bangladesh Investment Development Authority
Opportunities Unbounded
Almost all the sectors are open to FDI
Reserved Sectors
1.Arms & ammunitions 2.Nuclear Power 3.Security printing and minting 4.Afforestation and Mechanize Extraction within the boundary of reserved forest.
Agribusiness &
Food processing
Agro-based & agro-
processing
Jute & Jute goods
Flower cultivation
Commercial plantation
Horticulture
Silkworm &Silk Industry
Furniture
Handicrafts
Integrated shrimp cultivation
Frozen Food
Textile &
Clothing Home Textiles
Textiles industry
Readymade garments
industry
High value added RMG
ICT &
Electronics
ICT and ITES
Computer software &
ICT goods
Electronics
Light engineering incl.
automobiles
Energy &
Infrastructure
Power
Ports and Logistics
Economic Zones
Oil and gas
Tourism
Transport Infrastructure
Pharmaceuticals
Herbal medicines
Plastics Ceramics
Leather & leather goods
Textile Dye & chemicals
Basic chemicals
Pharma &
Chemicals Health care
Footwear
Cosmetics and toiletries
Jewelry and diamond
cutting polishing
Healthcare
& Others
10
©Bangladesh Investment Development Authority
Opportunities Unbounded
17 strategic sectors are open to FDI separately regulated…
• Exploration, extraction and
supply of other mineral
resources
• Large-scale infrastructural
project (e.g. flyover,
elevated expressway,
monorail, economic zone,
inland container depot/
container freight station)
• Crude oil refinery
(recycling/refining of lube oil
used as fuel)
• Fishing in the deep sea
• Bank/financial institution in
the private sector
• Insurance Company in the
private sector
• Generation, supply and
distribution of power in the
private sector
• Exploration extraction and
supply of Natural gas/oil
• Exploration, extraction and
supply of coal
• Medium and large industry
using natural gas/condescend
and other minerals as raw
material
• Telecommunication Service
(mobile/cellular and land
phone)
• Satellite channel
• Cargo/passenger vessels
• Sea bound ship transport
• Sea-port/deep sea-port
• VOIP/IP telephone
• Industries using heavy minerals
accumulated from sea beach
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©Bangladesh Investment Development Authority
Attractive Incentives Schemes
Bangladesh offers most attractive
investments incentives across sectors and locations
Fiscal & Tax Incentives
Tax holiday • 5 to 10 yrs for selected sectors• Upto 10 yrs for infrastructure• Upto 10 years for EZs
Accelerated depreciation
• in lieu of tax holidayDouble tax avoidance under
DTTs
Tariff concessions• capital machinery• import of raw materials
Bonded warehousing for
export oriented industries
Financial Incentives
Cash incentives • Exporting selected products
Export Development Fund
Equity Entrepreneurship Fund
Investment Incentives
OthersFast Track Approvals
Citizenship
Permanent Residency
Quick Immigration
Skilled Work Permits
NRB Preferences
12
©Bangladesh Investment Development Authority13
27th Investment cost survey JETRO 2017
Cost of components (water and electricity) rate: (US Dollar)
0.09
0.11
0.13
0.09
0.12
0.13
0.1
0.16
0.2
0.15
1.37
0.45
1.11
0.4
0.82
0.55
0.16
1.33
0 0.2 0.4 0.6 0.8 1 1.2 1.4 1.6
Dhaka
Beijing
Kulalampur
Manila
Bangkok
Hanoi
New Delhi
Mumbai
Karachi
Water rate for general use (per cu.m) Electricity rate for general use (per kWh)
Competitive factor cost among the peer cities:
©Bangladesh Investment Development Authority 14
(US Dollar)Cost of wages and salaries:
27th Investment cost survey JETRO 2017
111
677
345
262
346
192
217
260
208
582
1881
1712
1345
1478
979
1713
1593
1251
56
273
223
295
245
169
159
130
134
0 200 400 600 800 1000 1200 1400 1600 1800 2000
Dhaka
Beijing
Kulalampur
Manila
Bangkok
Hanoi
New Delhi
Mumbai
Karachi
Legal minimum wage Manager's salary Workers wages
Competitive factor cost among the peer cities:
©Bangladesh Investment Development Authority
Competitive edge of Bangladesh in investment segments
Abundance of work-force, Lowest Wage in Asia,
Duty Free Market Access, Bond Facilities, EZs/EPZs
Population of 160 Million, with 3 billion regional
market with Young and Brand Conscious
Consumers
High demand from Industrial Upgrading, Pursuit of
Efficiency and Productivity in Various Sectors,
Number of Mega Projects, Volume of ODA, external
finance
High Mobile Density, Internet Density, Tech Savvy
Young Generation, Digital Bangladesh Policy
Export Oriented
Consumer Market/ Finance
Trading
Infrastructure / Energy
Start-Ups / ITeS
15
©Bangladesh Investment Development Authority 16
Prospective sectors : Electronics Sector
• Global Electrical and Electronic products are highly branded. Bangladesh is producing mostly for the
domestic market.
• Approx USD 1.9bn market demand while local production approx. USD 1bn
• More than 3000 units are in operation, creating employment (direct and indirect) 0.1 million & 0.4 million
• Major Import substitution opportunity exists
• Middle class consumers of Bangladesh consist population more than Malaysia, Singapore, Thailand
• 40,000 light engineering workshops/enterprises operating. About 1 million people and innovative
entrepreneurs are actively engaged
• Annual turnover is US$ 1600 million of which Import substitute products is around US$ 200 million
• Over 90% are serving the local needs of the people.
• 10% cash incentives for export
• Availability of trainable labors at competitive cost
• Declared as special development sector in its Export Policy
Prospective sectors : Light Engineering Sector
©Bangladesh Investment Development Authority 17
Over 1000 IT companies thriving in the country and capturing a significant share in the
international markets worldwide.
Total estimated IT Industry Size is US$ 120 Million (including export)
Software contributes around 44%, whereas ITES contributes around 56% to the overall
industry revenue.
Approx 30000 professionals, majority IT and other graduates, are employed in the industry.
Total investment in this sector is more than 50000 crore and this sector is the largest contributor
to FDI in Bangladesh.
Online outsourcing, data entry and call center business are flourishing.
In the next 5 years, 1% of the country’s total GDP will come from the software and IT
services sector.
Prospective sectors : IT & ITES Sector
©Bangladesh Investment Development Authority
• Market Size: USD 2.8 Billion
• Industry Growth: 18.7%
• Registered companies : 266 (222 in operation)
• Total number of Brand : 12,500+
• Total number of generic : 934
• Export earnings reached USD 89.175 million in 2016-17
• Exported to more than 83 different countries over the last 7 years, an export growth rate
recorded 25.5% annually.
• Bangladesh holds the 14th position in 17 regional markets surveyed in BMIs Pharmaceutical,
also occupies 67th position in BMI’s pharmaceutical universe.
• Domestic manufacturers account for 97% of the drug sales, remaining 3% is imported.
• About 5,600 brands of medicines are manufactured
• API park where 40 API industries will be able to operate.
• The WTO TRIPS permits Bangladesh to reverse-engineer patented generics till 2033.
Prospective sectors : Pharmaceuticals Sector
18
©Bangladesh Investment Development Authority 19
• The medical device market is projected to USD 243.6 million in 2018
• Hospitals in Bangladesh experienced up to 24.5% growth in patients in 2016
• medical equipment market of Bangladesh is almost import dependent hence a potential sector to
invest
• Huge private hospitals as such best opportunity for selling high end equipment and medical
devices.
• Government builds hundreds of new healthcare facilities and upgrades existing facilities
• The average growth rate is more than 20% per year.
• 300 manufacturers, export plastic goods worth nearly USD 116.25 million in the FY 2016-2017.
• Currently, around 5000 companies are operating in this sector of which 98% of them are SME’s.
• Direct & indirect employment to over 1.2 million people in Bangladesh
• Annual sales at around BDT 150 billion in the local market, in which household items account for nearly
BDT 20 billion.
• Strong backward linkage sectors, such as light engineering sector in BD etc.
• Supports many products and technologies like packaging, textile, healthcare, construction, electronics,
energy generation automotive.
Prospective sectors : Medical Equipment Sector
Prospective sectors : Plastic Sector
©Bangladesh Investment Development Authority 20
• top priority sector in the overall development of the country.
• 48.5% of the total population of Bangladesh is enjoying the electric facilities.
• Total demand is projected to be more than 12000MW in 2017.
• Bangladesh needs total USD 18 billion investments in the power sector to minimize this demand-supply gap
• Public and private sector produce 63% and 37% of electricity respectively.
• The power sector is a capital-intensive industry, huge investments is required in order to generate addition to
the capacity.
• USD 40 billion investment will be required for new generation and USD 8 billion for transmission
network.
• Private sector Power Generation Policy of Bangladesh has offered attractive fiscal and non-fiscal incentives.
• Local Demand USD 2.5 Billion
• Raw Material Source 5:95 (Local: Imported)
• Future Investment Possibility: USD 2.5 to 3 billion
• Future Employment option: 1.5 Million
• Import Situation: 2.0 Billion
Prospective sectors : Power Sector
Prospective sectors : Automobile Sector
©Bangladesh Investment Development Authority 21
More than 47.5% of population dependent on agriculture for livelihood
Investment Areas
•Agri-input sectors like seed, fertilizer, Pesticide, irrigation & Farm Machinery
•Post-Harvest infrastructure
•Food processing like eligible oil, rice, sugarcane, potato, fruits & vegetables & spices
Special Incentives
•100% foreign equity is allowed (Except for defense, nuclear energy, currency and forest
plantations)
•Tax incentives for 5-7 years based on location and industry dependent
•Cash Incentives: 20%
•electricity consumption special rebate of 20% to agro-processing sector
•Loan disbursement target in agriculture is USD 2 Billion
•Entrepreneurs Equipment Fund (EEF) is allowed agro-sector
Prospective sectors : Agri-business Sector
©Bangladesh Investment Development Authority
FDI performance of Bangladesh
22
©Bangladesh Investment Development Authority
328 350460
845 793666
1086
700
913
11361293
1599
22362332
2152
1527
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
(US$ Mill)
Bangladesh FDI Statistics
FDI Inflow since 2001
Source: Enterprise Survey, Bangladesh Bank
23
©Bangladesh Investment Development Authority
Bangladesh FDI StatisticsDistribution by Components
Source: Enterprise Survey, Bangladesh Bank
(Million US$)
24
2011 2012 2013 2014 2015 2016 2017
Equity 432 498 541 280 697 911 539
Reinvested
earnings 490 588 697 989 1145 1215 1280
Intra-company
loans 215 207 361 258 394 206 333
Total 1137 1293 1599 1527 2236 2332 2152
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©Bangladesh Investment Development Authority
Source: Enterprise Survey, Bangladesh Bank
Bangladesh FDI StatisticsDistribution by Sectors: (Million US$)
181375 324 227 255
573272
307 422391 443
364
249
136
327312
310
166
238127
99 50
574 434
23 75
40
53
125 87
6
61
31
32
25 43
167212
356462
505 665
0
500
1000
1500
2000
2500
2011 2012 2013 2014 2015 2016
Telecommunication Textiles & Wearing Banking
Power, Gas & Petroleum Food Products Agriculture & Fishing
25
©Bangladesh Investment Development Authority
FDI Stock…
26
6072.07 6165.817750.24
8593.4910028.8
12912.14
14539.32
0
2000
4000
6000
8000
10000
12000
14000
16000
2010 2011 2012 2013 2014 2015 2016
FDI Stock from 2010 to 2016
©Bangladesh Investment Development Authority 27
FDI Inflow since 2009- 2017 (South Asia):
Country 2009 2010 2011 2012 2013 2014 2015 2016 2017
Afghanistan 185 76 58 27 47 37 163 100 54
Bangladesh 700 913 1136 1293 1599 1551 2235 2333 2152
Bhutan 15 12 20 36 16 17 7 -12 10
India 35649 24640 36 190 24 196 28 199 34582 44046 44486 39916
Pakistan 2338 2 022 1 162 859 1333 1867 1289 2006 2806
Sri Lanka 404 478 956 941 933 994 680 898 1375
Maldives 112 164 424 *228 *361 *333 *308 *448 517
Nepal 39 39 95 92 71 30 52 106 198
Bangladesh FDI Statistics of South Asia
©Bangladesh Investment Development Authority
FDI of Bangladesh
28
(In million USD)
Year Total Equity
capital
Reinvested
earnings
Intra-
company
loans
2011 1136.38 431.85 489.63 214.9
2012 1292.57 497.63 587.54 207.4
2013 1599.16 541.06 697.11 360.99
2014 1551.28 280.3 988.81 282.17
2015 2235.39 696.67 1144.74 393.98
2016 2332.72 911.38 1215.39 205.95
2017 2151.56 538.90 1279.42 333.24 0 500 1000 1500 2000 2500
2011
2012
2013
2014
2015
2016
2017
1136.38
1292.57
1599.16
1551.28
2235.39
2332.72
2151.56
431.85
497.63
541.06
280.3
696.67
911.38
538.9
489.63
587.54
697.11
988.81
1144.74
1215.39
1279.42
214.9
207.4
360.99
282.17
393.98
205.95
333.24
Intra-company loans
Reinvested earnings
Equity capital
Total
©Bangladesh Investment Development Authority 29
Foreign borrowings trends:
Foreign borrowings for project financing has increased manifold recently mostly from multilaterals and investment banks…
Private Sector Foreign Borrowing
Year Amount (in million USD)
2009-10 175.93
2010-11 431.46
2011-12 1047.93
2012-13 1795.28
2013-14 1453.38
2014-15 2299.61
2015-16 887.69
2016-17 1604.37
2017-18 1422.84
Total 11118.49
0.00
500.00
1000.00
1500.00
2000.00
2500.00
©Bangladesh Investment Development Authority
Bangladesh-Singapore Relationship
30
©Bangladesh Investment Development Authority
Bangladesh-Singapore Bilateral Trade Statistics
31
Year Export Import
2009-10 80.03 1550.68
2010-11 113.41 1291.90
2011-12 179.23 1709.61
2012-13 155.99 1421.9
2013-14 135.86 2407.32
2014-15 153.463 2197.83
2015-16 164.99 1861.97
2016-17 335.12 2447.00
Value in Million US $
Major Export Items:Woven Garments, Knitwear, HomeTextile, Agri-Products, Frozen Food,Leather & Leather Products,Footwear, Raw Jute.
Major Import Items:Vegetable products; Animal orvegetable fats and oils etc; Preparedfoodstuffs; Mineral products;Products of the chemical or alliedindustries; Plastics & rubber articles;Pulp of wood products; Base metals& articles of base metal; Machinery& mechanical appliances; electricalequipment.
©Bangladesh Investment Development Authority
Bangladesh Investment Opportunity By Singapore Business Leader
Bangladesh is the third-largest South Asian economy and has shown consistent annual growth of 6-7% for the past three
years. Bangladesh is a significant trading partner of Singapore, with bilateral trade amounting to S$3.9 billion in 2016. In
the same year, Bangladesh was Singapore’s 28th largest trading partner and 22nd largest export destination.
Singapore’s top exports include fuel oils, automotive diesel fuel, jewellery of other precious metals and non-monetary gold in
semi-manufactured forms. Singapore is a major business hub with an estimated 150 Bangladeshi companies based here.
Singapore also serves as a medical, education and travel destination;
Mr Teo said: “Bangladesh is a highly promising market that has not been getting the attention it deserves, and has
established both economic and political stability for a number of years. Bangladeshi businesses are familiar with Singapore
and attach a premium to our brand name, and it is opportune for our companies to explore emerging opportunities there.
From the feedback of Singaporean enterprises with businesses in multiple South Asian countries, Bangladesh is considered
as an easier destination to conduct profitable business.”
Singapore is looking for investment in a bigger way in Bangladesh as the world is beginning to take notice of "very strong
economic opportunities in Bangladesh“;
The strong and very consistent growth profile of Bangladesh has attracted Singapore to engage deeply with Bangladesh like
other countries of the world;
Countries all over the world compete for investment and companies will navigate towards those countries which are
welcoming having clean set of rules, strong rule of law and stable policies, significant steps are taken by the government to
that direction;
"Bangladeshi people have very good reputation they are very hardworking, friendly and very obliging.“
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©Bangladesh Investment Development Authority
Singapore FDI in Bangladesh
31
(In million USD)
Year Total FDIFDI from Singapore
2011 1136.38 13.74
2012 1292.57 37.88
2013 1599.16 162.39
2014 1551.28 117.41
2015 2235.39 175.27
2016 2332.72 673.05
2017 2151.56 202.73 0 500 1000 1500 2000 2500
2011
2012
2013
2014
2015
2016
2017
1136.38
1292.57
1599.16
1551.28
2235.39
2332.72
2151.56
13.74
37.88
162.39
117.41
175.27
673.05
202.73
FDI from Singapore
Total FDI
FDI from Singapore in Bangladesh
©Bangladesh Investment Development Authority 34
FDI Stock of Singapore in Bangladesh
(In million USD)
FDI Stock
Year Value
2011 133.74
2012 172.00
2013 364.79
2014 426.00
2015 434.35
2016 1106.36
2017 936.00 0 200 400 600 800 1000 1200
2011
2012
2013
2014
2015
2016
2017
133.74
172
364.79
426
434.35
1106.36
936
FDI Stock of Singapore in Bangladesh
©Bangladesh Investment Development Authority
FDI Inflows & Outflows of Singapore
33
(In million USD)
Year FDI inflows FDI outflows
2011 48329 31459
2012 57150 18341
2013 66067 39592
2014 68496 39131
2015 65262 35485
2016 61597 23888
2017 62006 24682
0 10000 20000 30000 40000 50000 60000 70000
2011
2012
2013
2014
2015
2016
48329
57150
66067
68496
65262
61597
31459
18341
39592
39131
35485
23888
FDI outflows
FDI inflows
FDI Flows of Singapore
©Bangladesh Investment Development Authority
Singapore Investment in Pipeline
Share-Equity wise Joint venture/100% Foreign Investment Projects Registered with BIDA up to April-2018
Singapore No. of UnitProposed Investment
(TK. In million) Proposed Investment
(USD In million) Proposed Employment
100% Foreign Investment 44 13373.018 196.951 8600
Joint venture Investment 122 94050.985 1476.102 19062
TOTAL 166 107,424.003 1,673.053 27,662
Sector wise Joint venture/100% Foreign Investment Projects Registered with BIDA up to April-2018
Name of the Sector No. of UnitProposed Investment
(TK. In million) Proposed Investment
(USD In million) Proposed Employment
Agro-Based 20 9,507.924 149.070 5,367
Food And Allied 5 4,462.332 59.815 760
Textile 17 5,302.167 124.036 7,717
Printing & Packaging 3 434.760 7.292 401
Chemical 24 10,488.104 209.036 2,251
Glass & Ceramics 1 358.000 4.837 60
Engineering 30 1,563.837 23.255 2,637
Service 64 75,146.301 1,093.649 8,259
Misc. 2 160.578 2.063 210 TOTAL 166 107,424.003 1,673.053 27,662
36
©Bangladesh Investment Development Authority 37
Prime Minister’s Office
BIDA
Investment Promotion and facilitating Agencies
Key Services• Investment promotion
• Investment facilitation
• Policy Advocacy
• Match-making
• Sector briefings
• Project Structuring
• Transaction Advisory
Key Services
• Counseling/ Advisory
• Regulatory Approvals
• Visas & Work Permits
• Foreign borrowing
• Investors aftercare
©Bangladesh Investment Development Authority
BIDA and its Responsibility
Bangladesh Investment Development Authority (BIDA) was created
under Bangladesh Investment Development Authority Act 2016.
BIDA’s Functions are broadly categorized into :
1. Investment promotion;
2. Investment Facilitation (approval, recommendations and aftercare)
3. Policy Advocacy
4. Ensure inclusive investment improving ‘Ease of Doing Business’
5. Creating entrepreneurs and creating necessary skill to complement local
industry needs.
6. Facilitate private investment to make Bangladesh MIC by 2021 and developed country by 2041
38
©Bangladesh Investment Development Authority
BIDA’s vision and mission
Vision
To be a leading agency contributing towards Bangladesh’s achievement of
high income status
Key underlying Assumptions
Foster a Private Sector-Focused Culture
Accumulate Deep Business Knowledge
Implement Internal Systems for Consistent Good Facilitation
Organizational Values
MISSIONTo promote and support pro-growth private sector investment and foster a
world-class investment ecosystem
Integrity
39
©Bangladesh Investment Development Authority
Bangladesh Investment Development Authority: Services to
Investors
Guidance on doing business in Bangladesh Registration of New Industries
Responding to investment-related queries Facilitation of Utility Services
Investment guidance and advice in specific
sectors
Support for importing machineries and raw materials
Support in forming statutes policies and
regulations
Support for obtaining external financing
Supporting potential foreign investors to
match with local investors
Approval of Royalty and Technical
Assistance Fees
Organize visit, meetings with various govt.
and private agencies
Facilitation of Setting up commercial offices
Addressees Issues relating to individual
companies on their smooth operation
Visa Recommendation and Work Permit
Issue
40
©Bangladesh Investment Development Authority
Development of Investment Climate in
Bangladesh by
Doing Business Reform
41
©Bangladesh Investment Development Authority
The need for Investment Climate Development and
Doing Business Index (Rankings)
Bangladesh is advancing with a constant GDP growth of more than 6% and with proper
adoption of the Doing Business reforms can ensure a ‘double-digit’ GDP growth.
The journey has started to create favorable investment climate started in January 2017.
A higher ranking in the ‘Ease of Doing Business’ index gives confidence to both local
and foreign investors
42
©Bangladesh Investment Development Authority
Doing Business 2018 Rankings
DB-2018 Rank DB-2017 Rank DB-2018 DTF DB-2017 DTF Change in DTF (% Points)
177 176 40.99 40.84 ↑ 0.15
• Needed 404 days for a new electricity connection in the major cities.
• 19.5 days required for ‘Starting a Business’
• Required 278 days to acquire all permissions required to build a warehouse in major cities.
• Property Registration took 244 days.
• 1442 days for enforcing contracts.
• Resolving Insolvency: 1461 days.
Indicator-wise Ranking of 2018
43
©Bangladesh Investment Development Authority
Doing Business Position 2017-2018
Sl. No. Topics DB-2018 Rank DB-2017 Rank DB-2018 DTF DB-2017 DTFChange in DTF
(% Points)
Overall 177 176 40.99 40.84 ↑ 0.15
1. Starting Business 131 122 80.67 81.51 ↓ 0.84
2. Dealing with Construction Permit 130 138 61.97 61.60 ↑ 0.37
3. Getting Electricity 185 187 16.97 16.16 ↑ 0.81
4. Registering Property 185 185 27.67 27.58 ↑ 0.09
5. Getting Credit 159 157 25.00 25.00 --
6. Protecting Minority Investors 76 70 56.67 56.67 --
7. Paying Taxes 152 151 56.13 55.76 ↑ 0.37
8. Trading Across Border 173 173 34.86 34.86 --
9. Enforcing Contracts 189 189 22.21 22.21 --
10. Resolving Insolvency 152 151 27.71 27.02 ↑ 0.69
= Doing Business Reform making if easier to do business. × = Change making it more difficult to do business.
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©Bangladesh Investment Development Authority
How ‘Ease of Doing Business’ Action Plan is Implemented By BIDA
1. Ease of Doing Business reforms, covering the 10 Indicators was launched on January 1, 2017 in presence of
Cabinet Secretary, Principle Coordinator (SDG affairs) and all Secretaries. Executive Chairman, BIDA has
presented target plan on each indicator. A Taskforce in all relevant Ministries for achieving the target is formed.
2. The Hon’ble Prime Minister has given her consent for implementation of the recommendations provided by DB
reforms, on November 9, 2016.
3. BIDA has taken the initiative instructed by PMO to establish an ‘Ease of Doing Business’ reforms
recommendation. acting with relevant agencies, addressing all indicators, formation of a time lined action plan.
BIDA successfully completed preparation of this action plan.
4. BIDA team headed by Executive Chairman of BIDA, met with Minister/Secretary of the concerned Ministries
and the Governor of Bangladesh Bank for implementation of the action plan.
5. Two National level committee were formed to coordinate all DB reform and related activities, Namely:
a. National Steering Committee , headed by Hon’ble Finance Minister,
b. National committee for Monitoring and Implementation of DB reforms, headed by Cabinet Secretary.
7. Amendment of relevant section of Company Act 1994, Arbitration Act, Contract Act, Insolvency Act, Artha Rin
Adalat Ain-2003 are identified by BIDA team and sent to concerned Ministries for implementation of ease of
doing business reforms.
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©Bangladesh Investment Development Authority
Bangladesh status in 'Ease of Doing Business Report based on DB 2018
1.Starting a business
2. Dealing with construction
permit
3. Getting Electricity
Current Rank 177 Target Rank 99 (By 2020)
Indicator Current Status Target
Procedures (number) 9 8Time (days) 19.5 7.5
Cost (% of income per capita) 13.9 4.0
Paid-in min. capital (% of income per capita) 0.0 0.0
Indicator Current Status Target
Procedures (number) 13 13
Time (days) 278.0 95
Cost (% of warehouse value) 1.7 0.3
Building quality control index (0-15)* 11.0 8.0
Indicator Current Status Target
Procedures (number) 9 9
Time (days) 404.0 100.0
Cost (% of income per capita) 3,229.6 550.0
Reliability of supply and transparency of tariff index (0-8)*
0.0 5.0
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Reform Proposal of Ease of Doing Business in Bangladesh
©Bangladesh Investment Development Authority
4. Registering
Property
5. Getting Credit
6. Protecting Minority
Investors
Indicator Current Status TargetProcedures (number) 8 7Time (days) 244.0 77.0Cost (% of property value) 6.5 2.9Quality of the land administration index (0-30)* 4.5 24.0
Indicator Current Status TargetStrength of legal rights index (0-12) 6.0 12Depth of credit information index (0-8) 0.0 8.0Credit registry coverage (% of adults)* 0.9 0.0Credit bureau coverage (% of adults)* 0.0 58.6
Indicator Current Status Target
Strength of minority investor protection index (0-10) 5.3 8.3Extent of conflict of interest regulation index (0-10) 6.3 9.3
Extent of disclosure index (0-10) 6.0 10.0Extent of director liability index (0-10) 7.0 9.0
Ease of shareholder suits index (0-10) 6.0 9.0Extent of shareholder governance index (0-10) 4.3 7.3
Extent of shareholder rights index (0-10) 3.0 8.0
Extent of ownership and control index (0-10) 5.0 7.0
Extent of corporate transparency index (0-10) 5.0 7.0
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Reform Proposal of Ease of Doing Business in Bangladesh
©Bangladesh Investment Development Authority
7. Paying Taxes
8. Trading
Across
Borders
9. Enforcing
Contracts
Indicator Current Status TargetPayments (number per year) 21.0 6.0Time (hours per year) 302.0 83.5Total tax rate (% of profit) 31.6 18.4
Indicator Current Status TargetTime to export: Border compliance (hours) 100 12Cost to export: Border compliance (USD) 408 335Time to export: Documentary compliance (hours) 147 4Cost to export: Documentary compliance (USD) 225 37Time to import: Border compliance (hours) 183 35Cost to import: Border compliance (USD) 1294 220Time to import: Documentary compliance (hours) 144 1Cost to import: Documentary compliance (USD) 370 37
IndicatorCurrent Status Target
Time (days) 1442 150
Cost (% of claim) 66.8 25.8
Quality of judicial processes index (0-18) 7.5 15.5
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Reform Proposal of Ease of Doing Business in Bangladesh
©Bangladesh Investment Development Authority
10. Resolving
Insolvency
Indicator Current Status Target
Recovery rate (cents on the dollar) 25.8 89.7
Time (years) 4.0 0.8
Cost (% of estate) 8.0 3.0
Outcome (0 as piecemeal sale and 1 as going concern) 0.0 1
Strength of insolvency framework index (0-16) 4.0 8.5
Commencement of proceedings index (0-3) 2.0 3.0
Management of debtor's assets index (0-6) 2.0 4.0
Reorganization proceedings index (0-3) 0.0 0.5
Creditor participation index (0-4) 0.0 1.0
Reform Proposal of Ease of Doing Business in Bangladesh
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©Bangladesh Investment Development Authority
Achievements of Doing Business Reforms in Bangladesh
A. Getting Electricity
Reduction in number of days to obtain a permanent electricity
connection, from 404 days to 28 days.
System average interruption duration index (SAIDI) – 400 minutes
System average interruption frequency index (SAIFI) – 20 times
Minimum outage time is 3 minutes in calculating SAIDI/SAIFI in
Bangladesh
Electricity distribution utility use automated tools to monitor outages.
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©Bangladesh Investment Development Authority
B. Paying Taxes
Online Facility(e-filing and e-payment) of personal and business income
taxes.
Implementation of ASYCUDA for e-filing ad e-payment of customs duties.
Mandatory VAT e-registration for Chittagong and Dhaka.
TIN and VAT services are becoming interlinked
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Achievements of Doing Business Reforms in Bangladesh
©Bangladesh Investment Development Authority
C. Dealing with Construction Permits Reduction in number of days to get permit of building from 278 days to 60
days
Scheduled inspections are required by law to be carried out during construction.
Structural Engineers are held liable by law for structural flaws or problems in the building once it is in use.
Diploma Engineers supervises the construction on the ground.
RAJUK and City corporation are in charge of the plans showing legal boundaries in the metropolitan city
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Achievements of Doing Business Reforms in Bangladesh
©Bangladesh Investment Development Authority
D. Registering Properties Public availability of list of documents that are required to complete any
type of property transaction,
Public availability of of applicable fee schedule for any property transaction at the agency in charge of immovable property registration and fee schedule for accessing maps of land plots
Property ownership documents are provided on time by the responsible agency.
Specific and separate mechanism for filing complaints on a problem at the agency in charge of immovable property registration are in place
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Achievements of Doing Business Reforms in Bangladesh
©Bangladesh Investment Development Authority
E. Protecting Minority Investors: Terms are required to be reviewed by an external body if more than 10% of
company's shares are being acquired.
Buyer of share must immediately disclose the transaction to the public and/or shareholders.
The plaintiff can directly question the defendant and witnesses at trial.
The board of directors must include independent and nonexecutive board members.
Buyer must pay declared dividends within a maximum period set by law.
Buyer must distribute profits within a maximum period set by law.
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Achievements of Doing Business Reforms in Bangladesh
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One Stop Services (OSS) for the Investors
Investors require various services such as clearances, certificates, certificate of origin, licenses
and approvals, loan sanction permits, recommendations for visa and work permit, environment
related certificates, resident and non-resident visa processing, various fiscal and non-fiscal
services, corporate tax and VAT related certificates and various exemptions and utility services
etc.
The current Government, decided to create a ‘One Stop Service (OSS) Centre’ and provide the
investors with as many services as are possible through the Centre and passed the OSS Act.
150 services of 34 agencies are identified and process simplification of these have started. Once
these are completed clients will get their services from one point.
The model of service delivery will be virtual and cloud based. As such agencies will deliver the
services from their end with online connectivity and clients will not be needed to go to any offices.
To ensure prompt and in time services delivery their will be and ‘OSS Assurance Committee’
headed by hon’ble Finance Minister.
©Bangladesh Investment Development Authority
Thank you for your kind patience
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