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Foreign Direct Investments played a primordial role in the economic development of Bangladesh during the last two decades. The increasing amount of FDI in Bangladesh reveals the dynamic transition to a market economy. The liberalization process, in a resilient and stable environment, makes Bangladesh one of the most attractive destinations with regards to FDI. In 2011, investments amounted to more than 1130 Million USD, making Bangladesh an attractive recipient of FDI in Asia.

During the 2009-2010 Fiscal Year, almost 90 joint-ventures were registered at the Board of Investment (BOI). This institution, which works in close coordination with Prime Minister’s Office, is in charge of promoting FDI in Bangladesh. It aims at coordinating the governmental agencies, rationalizing investment process and giving a step-by-step procedure to foreign businessmen. BOI encourages investments in association with skill transfers and social development. As an example, FDI in the R&D sector is increasing steadily.

China, South Korea, India, Japan, the United Kingdom, Norway and the USA are involved in a huge number of joint-ventures. The garment sector, the energy sector and the banking sector attract a major part of the FDI. Foreign companies are also investing massively in communication and telecommunication infrastructures in order to rationalise the logistic process (export-oriented FDI).

Bangladesh offer many tax and non tax-related incentives to attract foreign investments (e.g. corporate tax holiday, income tax exemption, tax exemption, facilities for repatriation of invested capital, etc.). The environment climate in Bangladesh is suited to both short-term and long-term investments. The Foreign Private Investment Act, 1980, states the principle of equal treatment for local and foreign investors. The Export Processing Zones are targeted to be the main recipient spot of FDI. In 2010, Bangladesh reached the 4th position of the SAARC members in the “ease of doing business” ranking by the World Bank.