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© Board of Investment 2014 www.boi.gov.bd
Bangladesh at a glance
Source: Ministry of Finance, Bangladesh. Bangladesh Land Port Authority
2
8 Airports $1044
GDP Per
Capita
$129.9bn
GDP
6.2%
GDP
Growth
156.6mn
Population
9
River ports
20 Land ports
2 Sea ports
$1.6bn FDI
$30.1bn Export
8 EPZs
© Board of Investment 2014 www.boi.gov.bd 3
Why Bangladesh?
Investment Climate
Bangladesh is a winning combination with its competitive business-
friendly environment and cost structure that can give you best returns:
• Industrious competitive workforce
• Strategic location between china and India with regional connectivity and
worldwide access.
• Strong local market and growth
• Low cost of energy
• Proven export competitiveness
• Competitive incentives
• Export and Economic Zones
• Positive investment climate.
© Board of Investment 2014 www.boi.gov.bd
Why Invest in Bangladesh?
Policies and Reforms
Continued reforms taking
place embracing global best
practices
A positive attitude among
policy makers towards
undertaking reforms for
business growth
A special high-level
committee works for policy
and regulatory improvement
Appealing incentives
Offering a whole range of
investment incentives and
benefits
All fiscal, financial and other
types of incentives are
competitive among similar
locations
Market Access
• Bangladesh has a large domestic market of nearly 160 million
• Middle class (with purchasing power) is growing fast
• Has access to regional market of about 1.5 billion people through regional and bilateral integration in South Asia
• Bangladesh has preferred market access (global reach) to large developed markets
• ASEAN /East Asian investors can utilize Bangladesh as an export springboard to the world
Conducive policies, greater market access and encouraging incentives …
Source: International Finance Corporation
Source: CIA World Factbook (Tractus Asia Analysis)
Sustained
supply of
working-
age
workforce 23.8
26.6
28.5
34.7
35.8
15 25 35 45
Bangladesh
India
Vietnam
Thailand
China
Median Age: One of Asia’s Youngest Populations
© Board of Investment 2014 www.boi.gov.bd
Why Bangladesh – Steady rise in investments
FDI in Bangladesh last year rose by 24% to US$ 1.6bn, the highest in its history;
In SA region, Bangladesh has fared well during the global downturn and has secured 2nd position;
It is also one of the few countries that have shown an upward trend, despite the global downturn.
© Board of Investment 2014 www.boi.gov.bd
Investment Promotion and Protection
Foreign 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.
Bilateral and multilateral investment agreements ensures protection of
investment.
Bangladesh is a signatory to ICSID, UNCITRAL, OPIC, MIGA, WAIPA,
WIPO and WTO.
Bilateral Investment treaties (BITs) signed with 29 countries Austria, DPR Korea , Thailand, Belgium, Republic of Korea, UK, Canada, Malaysia, USA, China. Pakistan Uzbekistan, France, Poland, Vietnam, Germany, Romania, Singapore, Indonesia, Switzerland, Denmark, Iran, The Netherlands, India, Italy, The Philippines, UAE, Japan, Turkey)
Double taxation treaties (DTTs) with 33 countries Canada, Poland, Norway, China, Romania, Turkey, Denmark, Sigapore, Vietnam, France, Republic of Korea, Philippines, Germany, Sri Lanka, Indonesia, India, Sweden, Switzerland, Italy, Thailand, Oman, Japan, The Netherlands, Malaysia, UK, Belarus, Belgium, KSA, Mauritus. Myanmer,Pakistan, UAE, USA)
6
Investment Climate
© Board of Investment 2014 www.boi.gov.bd
The National Industrial Policy, 2010 of Bangladesh recognizes:
a. Private sector is treated as the engine of growth
b. No upper ceiling for foreign investors or performance requirements
c. 100% foreign equity is allowed
d. All industrial sectors are open for foreign investors for investment
except 4 reserve sectors for the government.
e. Equal treatment for both local and foreign investment
f. Export oriented industries are given top priority
7
Investment Climate FDI Policy Framework
© Board of Investment 2014 www.boi.gov.bd
Business Stage Policy & Regulation
1. General - Bangladesh Industrial Policy (as undertaken from time to time)
1. Business start-up - The Companies Act, 1994
- Securities and Exchange Commission Act, 1993
1. Protection - The Foreign Private Investment (Promotion & Protection) Act, 1980
1. Export Zones - Bangladesh Export Processing Zones Authority Act, 1980
- Bangladesh Private Export Processing Zones Authority Act, 1996
1. Facilitation - The Investment Board Act, 1989
1. Corporate /
Personal Taxation
and incentives
- Income Tax Ordinance 1984 and related rules and SROs
- National Budget
- The Finance Act/Bill
1. International Trade
(Export & Import)
- Bangladesh Export Policy (as undertaken from time to time)
- Bangladesh Import Order (as undertaken from time to time)
1. Sectoral - Bangladesh Energy Regulatory Commission Act, 2003 (BERC)
- Bangladesh Telecommunication Regulatory Commission Act, 2001 (BTRC)
- The National Drug Policy, 2005
1. Foreign Exchange - Bangladesh Foreign Exchange Guidelines (issued from time to time)
8
The broader FDI policy & regulatory framework include, among others, the following:
FDI Policy Framework
Investment Climate
© Board of Investment 2014 www.boi.gov.bd 9
Fiscal Incentives • Corporate tax holiday: 5 to 7 years for
selected sectors and areas
• Tax holiday for infrastructure
investment: upto 10 years
• Accelerated depreciation on cost of
machinery for new industries in lieu of
tax holiday
• Avoidance of double taxation under
bilateral tax convention
• Tariff concessions on import of capital
machinery
• Tariff concessions on import of raw
materials of the export oriented
industries
• Bonded warehousing facility
Financial & Other Incentives • Cash incentives and export
subsidies ranging from 5% to 20%
on the FOB value of selected
products:
• Funds for export promotion, export
credit guarantee scheme, permission
for domestic sales up to 20% by
export-oriented companies outside
EPZ.
• Remittance of royalty, technical
know-how and technical assistance
fees
• Citizenship by investing a minimum
of US$ 5,00,000
• Permanent resident permits on
investing US$ 75,000
• And many more .....
Investment Climate FDI Policy Framework - Incentives
© Board of Investment 2014 www.boi.gov.bd 10
Investment Climate FDI Policy Framework - Incentives Financial incentives:
Businesses exporting 80% or more of goods or services
• Reduced import duty on machinery & spares
• (1% for export oriented industries and 3% for other industries)
Export credit guarantee scheme
• Domestic market sales up to 20% allowed to export-oriented
companies outside EPZ (relevant duties apply)
Cash incentives and export subsidies (on the FOB value)
• 2% on 5% for export oriented local textiles (instead of duty drawback
and custom bond) , ship building, SME in textile industry, 7.5% on
frozen shrimp, Jute thread, 10% for jute products, light engineering
products, PET flex, export bone powder, 12.5% frozen fish, potato,
15% for leather products, and 17.5% for bicycles. 20% for agro-
processing and agricultural produce, potato export, handicrafts made
of straw sugarcane straw , halal meat.
© Board of Investment 2014 www.boi.gov.bd
1. Agro-based & agro-
processing industry
2. Jute & jute-mixed goods
3. Flower cultivation
5. Commercial plantation
6. Horticulture
7. Silkworm & silk industry
8. Furniture
9.Handicrafts
10. Home Textiles
11. Textiles industry
12. Readymade garments industry
13. High value added RMG
14. Computer software & ICT goods
15. Electronics
16. Light engineering incl. automobiles
18. Pharmaceutical goods
19. Leather and leather products.
20. Herbal medicines
11
Investment Opportunities Allowed Sectors for investment (as per the Industrial Policy 2010)
Sectors open for investment by the private sector – local & foreign
© Board of Investment 2014 www.boi.gov.bd 12
Investment Opportunities Allowed Sectors for investment (as per the Industrial Policy 2010)
21. Ceramics
22. Frozen Food
23. Integrated shrimp
cultivation
24. Infrastructure
25. Jewellery and diamond
cutting polishing
26. Oil and gas
27. Tourism industry
28. Basic chemicals/raw materials
used in industries.
29. Dye and chemicals used in
textiles industry.
30. Cosmetics and toiletries.
31. Information & Communication
Technology
32. Health care
Sectors open for investment by the private sector – local & foreign
© Board of Investment 2014 www.boi.gov.bd 13
1. Arms and ammunitions and other military equipments and
machinery
2. Nuclear power
3. Security printing and minting
4. Forestation on and Mechanized Extract on within the boundary
of reserved forest
13
Investment Opportunities Reserved Industries (as per the Industrial Policy 2010)
Sectors Reserved for investment by public sector. Private sector may
participate in procurement process as vendor/contractor.
© Board of Investment 2014 www.boi.gov.bd 14
1. Fishing in the deep sea
2. Bank/financial institution in the private sector
3. Insurance Company in the private sector
4. Generation, supply and distribution of power in the private sector
5. Exploration extraction and supply of Natural gas/oil
6. Exploration, extraction and supply of coal
7. Exploration, extraction and supply of other mineral resources
8. Large-scale infrastructural project (e.g. flyover, elevated
expressway, monorail, economic zone, inland container depot/
container freight station)
14
Investment Opportunities Controlled Industries (as per the Industrial Policy 2010)
Controlled Industries (considered as strategic investment. Free to
invest but requires pre-approval from specific regulatory agencies).
© Board of Investment 2014 www.boi.gov.bd 15
9. Crude oil refinery (recycling/refining of lube oil used as fuel)
10. Medium and large industry using natural gas/condescend and
other minerals as raw material
11. Telecommunication Service (mobile/cellular and land phone)
12. Satellite channel
13. Cargo/passenger vessels
14. Sea bound ship transport
15. Sea-port/deep sea-port
16. VOIP/IP telephone
17. Industries using heavy minerals accumulated from sea beach
15
Investment Opportunities Controlled Industries (as per the Industrial Policy 2010)
Controlled Industries (considered as strategic investment. Free to
invest but requires pre-approval from specific regulatory agencies)
© Board of Investment 2014 www.boi.gov.bd 16
Investment Opportunities Economic Zones
Govt has promulgated Economic Zones Act in 2010 to build EZ in the country
- Key Features:
Comprehensive industrial Infrastructure
Development under PPP (Private Public Partnership) model
Owned and regulated by the government, but managed by the private sector
Encompasses multiple business sectors within each zone
Combines both bonded and non-bonded area
EZ includes non processing & domestic area
Economic Zones under
implementation…
Mongla,
Sirajganj,
Anowara,
Mirershorai
Maulvibazar
© Board of Investment 2014 www.boi.gov.bd
Total
34 projects
($12.5b)
Medium Projects
6 Projects
($110m)
Large Project
25 Projects
($12b)
Small Projects
3 Projects
($7m)
PPP Projects by Size
SL. Sectors Implementing Agency Name of the ProjectProject
Size
Estimated
Cost (US$m)
1 Road BD Bridge Authority Dhaka-Elevated Expressway Large $1,088
2 ICT BD Hi-tech Park Auth Hi-tech Park at Kaliakoir Large $125
3 Health DGHS 40 beds Hemodialysis Centre at CMCH Small $2
4 Health DGHS Hemodialysis Centre at NIKDU Small $1
5 Bridge BD Bridge Auth Dhaka-Ashulia Elevated Expressway Large $1,471
6 Road RAJUK Flyover - Santinagar to Mawa over Buriganga River Large $313
7 Port MPA 2 Jetties at Mongla Port through PPP Large $50
8 Social Care DSS Oboshor: Senior Citizen Health Care Complex Medium $6
9 Road Roads & Highways
Dept Dhaka-Chittagong Access Controlled Highway Large $1,585
10 Rail Bridge Bangladesh Railway Fulchhari Bahadurabad MG Railway Bridge Large $1,400
11 Rail Bridge Bangladesh Railway Dual gauge Double line Bangabandhu Bridge Large $1,000
12 Road Roads & Highways
Dept Dhaka Bypass 4 Lane (Joydevpur-Madanpur) Large $114
13 Tourism BD Parjatan Corp 5 Star Beach Hotel with 18-Hole Golf Course Large $125
14 Housing Nat Housing Assoc NHA Housing Satellite Project at Mirpur Large $57
15 Port CTG Port Authority Construction of Laldia Bulk Terminal Large $60
16 Bridge BD Bridge Authority 2nd Padma Multipurpose Bridge Paturia-Goalundo Large $1,902
17 Port CTG Port Authority 3rd Sea Port Large $1,200
18 Road Roads & Highways
Dept Jatrabari-Sultana Kamal Brdg-Tarabo PPP Rd Large $44
19 Road Roads & Highways
Dept Hemayetpur-Singair-Manikganj PPP Road Large $84
20 Housing RAJUK High–Rise Apartment Complex Purbachal Phase 1 Large $1,199
21 Airport CAAB Multi Mode Surveillance System (Radar) HSIA Medium $23
22 Health Bangladesh Railway Med College/Hospital Upgrade-Kamlapur Large $97
23 Health Bangladesh Railway Medical College/Hospital Upgrade- CRB Chittagong Large $73
24 Health Bangladesh Railway Med College/Hospital Upgrade- Saidpur Nilphamary Large $73
25 Health Bangladesh Railway Med College/Hospital Upgrade-Paksey Pabna Large $73
26 Health Bangladesh Railway New Medical College & Hospital - Khulna Large $97
27 Rail Depot Bangladesh Railway New Inland Container Depot - Dhirasram Rail
StationLarge $150
28 Port BIWTA Inland Container Terminal PPP-Khanpur Large $40
29 Tourism Bangladesh Railway 5 Star Hotel at Zakir Hossen Road, Chittagong Large $36
30 Hospitality Bangladesh Railway Shoping Mall with Hotel-cum-Guest House in Khulna Medium $29
31 Hospitality Bangladesh Railway Shoping Mall with Hotelin Chittagong Medium $11
32 LPG /
EnergyBD Petroleum Corp LPG Bottling Plant (Jetty, Pipelines) Kumira Medium $31
33 Hospitality MPA Mongla Port Tower Medium $10
34 Fisheries Dep of Livestock Serv 16 X Fisheries and Livestock Projects Small $4
PPP Projects Pipeline (Note: Project names have been shortened)
Note: (1) All figures are initial estimates and will be updated in project development & procurement phase.
(2) Figures have been converted to US$ @ BDT80=US$1
Growing PPP portfolio…
Bangladesh Context
Source: PPP Office, Bangladesh
© Board of Investment 2014 www.boi.gov.bd 18
Arrival in Bangladesh
Help Desk of Board of
Investment at Airport
Opening a Bank Account
(As per “GFET 1996, Vol-1,
Bangladesh bank) http://www.bangladesh-bank.org
Trade License
from Local Govt.
Bodies
Tin Certificate
from Income
Tax Office
Company Formation
& RJSCF registration
http://www.roc.gov.bd
Application for BOI
Registration
• BOI Prescribed Form
• Project Profile
• Memorandum of Articles
of Association
• Certificate of
Incorporation
• Land Information &
Document
• Machinery Details
• Tax Identification
Number
• VAT Registration
• Trade License
• Pay Order
Import of Machinery Open
Letter of Credit (LC) or as
Equity Investment
Clearing of Capital
Machinery paying
VAT
Fire License
Industrial ad-hoc IRC from
CCI&E being Recommended
by BOI
http://www.ccie.gov.bd
VAT Registration from NBR
http://www.nbr-bd.org
DOE Clearance
Private Limited Company
(Capital if exceeds Tk. 10
crore, SEC permission
needed)
Public Limited Company
(Minimum paid-up capital
shall be Tk. 400 million)
Roadmap to Invest in Bangladesh
© Board of Investment 2014 www.boi.gov.bd 19
Regulatory services:
Registration of New Industries
Facilitation of Setting up Foreign Commercial Offices
Facilitation of Utility Services
Visa Recommendation
Work Permit Issue
Recommendation for IRC, Bonded Warehouse
Approval of Royalty and Technical Assistance Fees
Processing of Foreign Borrowing
Board of Investment Services to Investors
© Board of Investment 2014 www.boi.gov.bd 20
Facilitation services:
Responding to investment-related queries
Guidance on doing business in Bangladesh
Support forming Sector-specific legislations/regulations,
Industrial policy, custom and excise duties, taxation,
investment and trade agreements, etc.
Investment guidance and advice in specific sectors and in
areas of land, incentives, etc.
Business-to-business linkages:
Helping identify and connect with potential joint venture
partners/technical collaborations
Help finding Bangladeshi partners for investments
Board of Investment Services to Investors
© Board of Investment 2014 www.boi.gov.bd 21
Handholding support for investments :
• Coordinating with governments agencies for facilitating
information on land availability/infrastructure/power, etc.
• Coordinating meetings with relevant authorities in various govt
agencies and organize visits for investors
• Addressing any concerns faced by individual companies — with
government departments and other areas
Board of Investment Services to Investors
© Board of Investment 2014 www.boi.gov.bd 22
Business process Simplification: at a glance
Types of the Process simplified No. of
process
reformed
A Business Regulation Simplification 18
B Legal/Policy Amendments and New
Laws
12
C Private public joint efforts 4
© Board of Investment 2014 www.boi.gov.bd 23
Board of Investment, Prime Minister’s Office
Government of the People's Republic of Bangladesh,
Jiban Bima Tower (19th Floor), 10 Dilkusha C/A, Dhaka-1000, Bangladesh
Phone: (880-2) 957 7271 Fax: (880-2) 956 2312 Email: [email protected] Web: www.boi.gov.bd
Thank you