The government has taken initiatives to prepare a special package for attracting investments from the internationally-renowned companies in the country, industries ministry officials said.
A committee, formed under the industries ministry in October last year, is working to finalise the package that might include facilitation of land acquirement on easier conditions and tax exemption.
The committee might also propose the government that it should keep the tariff policy unchanged for five years to encourage the internationally-renowned brands in the automobile, information technology and agricultural sectors to come here for investment.
Bangladesh received $1.13 billion in FDI in 2011, highest in its history.
But the country is still one of the lowest FDI recipient countries in the region as countries like Vietnam, China and India are receiving much higher amount of FDI.
The industries ministry committee was asked to review policies of Vietnam, China and India before finalising its proposals, said the ministry officials.
Bangladesh is also facing the problem of outward transfer of FDI.
The amount of fund the foreign investors repatriated in profits and dividends were higher than the inflow of FDI in some months.
For instance, the flow of the net foreign direct investment was negative $42 million in the first nine months of the last fiscal year, Bangladesh Bank data showed.
Foreign investors are allowed to repatriate 100 per cent of their profits.
The committee has already held two meetings in this connection and reviewed nagging power shortage, lack of infrastructure in the transport sector and scarcity of land in suitable areas as major impediments to the FDI growth.
‘It is now reviewing opinions of the ministries and divisions for finalising its proposals,’ said outgoing chief of the committee Munsur Ali Sikder, also an additional secretary.
Munsur Ali, who has recently been transferred to Bangladesh Chemical Industries Corporation, told New Age that the committee might not able to complete the task in the three-month timeframe.
It will require some more time, he said.
Board of Investment executive chairman SA Samad said frequent changes in the tax policy were major impediments to the inflow of FDI.
He hoped that the inflow of FDI would increase further if the government followed a more stable tax policy.
Samad said that the country needed to fetch more FDI for development as the flow of foreign assistance was declining compared to the size of the country’s economy.
Mirza Azizul Islam, a former caretaker government adviser, said the government failed to attract FDI.
He said it would be difficult to attract the foreign investors if problems like poor infrastructure, lack of power, bureaucratic tangles and political instability remained.
Syed Nasim Manzur, former vice-president of Metropolitan Chamber of Commerce and Industry, said scarcity of land was forcing many willing foreign companies not to select Bangladesh as their investment destination.
He suggested that the country should concentrate on a particular industry to attract FDI.
Courtesy of New Age
