8 key reasons to source from BANGLADESH
Bangladesh – one of the fastest growing economies of South Asia got its independence in 1971 after the 9-month long liberation war under the unrivalled leadership of the Father of the Nation Bangabandhu Sheikh Mujibur Rahman. Bangabandhu’s worthy daughter Hon’ble Prime Minister Sheikh Hasina is working relentlessly to carry forward the Bangabandhu’s cherished dream to build a golden Bangladesh free from poverty and hunger. One of the notable achievements of the visionary leadership of the Hon’ble Prime Minister is the graduation of Bangladesh as a developing country.
The present government has adopted a number of measures to make Bangladesh a developed, prosperous and high-income country. The aim of Vision 2021 is to transform Bangladesh to a developing country and formation of a digital Bangladesh. Perspective plan 2021-2041 is poised to upgrading Bangladesh from a lower middle income country to a higher middle income country by 2031 and a high income country by 2041, and implementation of the Sustainable Development Goals 2030.
Bangladesh has an impressive track record of growth and poverty reduction. It has been among the fastest growing economies in the world over the past decade, supported by a demographic dividend, strong ready-made garment (RMG) exports, and stable macroeconomic conditions. Continued recovery in exports and consumption will help growth rates pick up to 6.4 percent in the last fiscal year 2021-22.
The United Nations has given the final approval to Bangladesh as a developing country in 2026 as it has been able to fulfill all the conditions required to be graduated from a least developed country category to a developing country. The transition to developing countries will create a positive image of Bangladesh in the world and create new opportunities as well as a number of challenges in investment and trade. One of the biggest challenges is losing or limited of duty-free quota-free market access in the international market under the auspices of the World Trade Organization (WTO). In order to meet this challenge, it is essential to produce quality export goods and services at a competitive price and to diversify the export market. Trade agreements with potential countries need to be executed to regain market access.
Our country is making progress in several social and economic sectors. From agriculture to pharmaceuticals and from shipbuilding to garments, Bangladesh’s industrial base is diversifying and its exports are increasing. The government has published Export Policy 2021-24, extending more policy and fiscal support, rationalising corporate tax and offering bonded warehouse facilities. The main objectives of export policy are to encourage exploration of new markets and products as the government looks to give a much-needed boost to export earnings. In the export policy, the government laid emphasis on growing an export-led economy and generation of more employment so as to offset the Covid-19 induced challenges. It is also expected that the export order policy will be able to prepare the export sector to face the challenges of the country’s graduation from LDC while it will lose its preferential market access to many countries after 2026. The policy also emphasized on the fourth industrial revolution (4IR), SHE trade and environmental issues.
Bangladesh enjoys near about fifteen years of uninterrupted democratic governance with well-developed governmental, economic and social structures. We have been marching ahead under the dynamic leadership of Hon’ble Prime Minister of the People’s Republic of Bangladesh, Sheikh Hasina. Due to timely and prudent initiative taken by the Government, investment and business friendly environment have been improved to a great extent. In fact, Bangladesh has now become a very attractive destination to the foreign investors and traders as well.
There are as many as 750 products on the list of exportable, but 85-90 per cent of the annual export receipts come from RMG and a few other items. Whilst the RMG sector needs to be continuously nourished to enable it to retain its competitive edge in the global market, there is great scope for expansion of other export sectors.
Now, the government is providing policy support to the non-RMG products. Those who are small suppliers need networking, matchmaking and information sharing to market their products overseas. Government-to-government negotiations are ongoing to remove or reduce the non-tariff barriers, especially to the non-traditional markets that need non-traditional products.
Of the total exports of the country, 23 per cent goes to the US, nearly 60 per cent to the EU countries, 5.0 per cent to Canada and 12 per cent to the rest of the countries of the globe. So, it is clear how much of the country’s exports rely on a few markets, as such here too there is great scope for expansion. Bangladesh started exploring new export destinations like Japan, Russia, South Africa, Mexico, Brazil, Chile, Malaysia, New Zealand, India, South Korea, China and Australia. Export growth to these countries has been higher over the last few years.
Even within its garment sector, Bangladesh has a lot of scope to diversify. The country mainly produces basic garment items, although the country has a scope to avail the benefit of upscale market through diversification of garment products.
Shipbuilding is an emerging sector for Bangladesh. Two or three companies have already exported small to medium oceangoing ships to some countries like Germany, Denmark and Mozambique.
This industry being a labour-intensive one can provide employment to a large pool of skilled and unskilled workers. Globally, the annual market size of shipbuilding industry is around $1,600 billion, and that of small ships is $400 billion worldwide. If Bangladesh can even avail 1.0 per cent share of small ships, the country will be able to earn $4.0 billion a year.
Pharmaceuticals sector is very promising in the country. Currently, local pharmaceuticals meet 97 per cent of the domestic demand. The country has 270 registered pharmaceutical companies and exports drugs and medicines to more than 90 countries.
Export of jute and jute goods is regaining its previous shine. After a long time, jute and jute goods crossed $1.0-billion-mark export in the last fiscal. Jute and jute goods became the second largest export items in the last fiscal after RMG. Jute and jute goods have high demand, particularly in Turkey and in some Middle Eastern and African countries.
Agriculture and agro-processed food industries have become a major exporting item for Bangladesh now. The demand for Bangladeshi vegetables, fruits and agro-processed food items is high among the non-resident Bangladeshis residing in different countries.
Bangladesh has already become a popular country for exporting quality leather, leather goods and footwear. Bangladesh exported $335.51 million worth of leather goods and footwear in the last fiscal. A number of footwear and leather goods manufacturers are exporting quality products globally.
Bangladesh has great potential in export of ceramic tableware, tiles and earthen tallies, fisheries and crabs, plastic goods and furniture as well. Another important sector that has good potential for export is light engineering.
The government and the private sector are taking join initiatives to diversify exportable products and global markets.
It is considered as the most challenging megaproject currently underway in the country. The Padma multipurpose bridge spans the Ganges River and connects the southwest region to northern and eastern areas. The structure accommodates a four-lane highway on top and a single-track railway. It believes that Padma multipurpose bridge will boost the local economy by 1.2.
Dhaka the country’s capital city and the ninth most populous metro region in the world are bursting at the seams to accommodate the growth developers are expanding into surrounding territories. Purbachal residential model town is the most anticipated build-out and a hotbed of investment opportunities just located sixteen miles from the center of Dhaka. Purbachal residential will occupy over six thousand acres and include residential recreational business and institutional components. Notably, Dhaka University will also open a second campus in purbachal.
It’s part of the Bangabandhu tri-tower development site. The legacy tower is scheduled to be the 111th floor skyscraper in the new purbachal business district. Hirim architects designed the building and engineering teams from Japan, France and South Korea are collaborating on the build. A modern undertaking legacy tower will feature state-of-the-art. Solar power technology and automatic waste systems construction began on the legacy in September 2020. Down the line liberation and language towers are schedule to complete the trio of planned high-rises.
Dhaka’s explosive population growth and small landmass have made it the poster child for infrastructure dysfunction. A 2016 New York times framed the city’s dire traffic situation as quote – “traffic in extreme a state of chaos so persistent” and everlasting that it has converted the city’s establishing principle . It’s not an uncommon for an eight-mile drive to take two and a half hours, but officials hope to fix the crisis with the Dhaka elevated expressway a 150000-foot highway that will run between Shahjalal airport and kutubkhali. The country’s prime minister announced 1.4 billion projects in the spring of 2011 and gave it a three-year completion time. But things didn’t work out exactly as planned as of 2021. The elevated expressway still isn’t complete. However, there is a glimmer of hope that it will be done by 2022.
The Bangabandhu sheikh Mujibur Rahman tunnel (karnaphuli tunnel) will be the first river tunnel in Asia located in Chattogram and expected to open in 2022. The country’s most active port city the underground throughway will measure 2.06 miles and span about 34 feet. some of the region’s energy issues. Currently, it is exacerbated by the growing economy and population.
In the not-too-distant past common wisdom discounted a Dhaka subway on account of the country’s monsoonal flooding. But where there is a will there is a way and engineers figured out how to make it happen. So, if all goes according to plan the city will have a fully functioned underground train network by 2041. The 8 billion ventures is expected to span 160 miles and run 11 lines but don’t expect to hop on the Dhaka express anytime soon the first line probably won’t be open for at least another decade.
It is located in the moheshkhali region. Matarbari is a deep seaport the country’s first. It’s modified after two highly trafficked ports in Japan Nîgata and Kashima and the Japanese international cooperation agency won the contract to manage it’s part of the port is complete and boats have already docked at matarbari. However, the project won’t be 100 percent done until 2026.
The country’s first nuclear power plant Roop-pur is about 87 miles west of Dhaka Rosatom state atomic energy cooperation a Russian conglomerate is building the energy critical components and local developers are handling the rest 2023 is the target launch date for two units and officials hope it will help alleviate project is supported by the South Asia Sub-regional Economic Cooperation (SASEC). It will take five years to complete the project and hire about 3,500 workers in the community. It will also boost the country’s southernmost trade and tourism. Construction work on the project will begin in March 2018 and is expected to be completed by 2022.
In a developing country like Bangladesh, where GDP is growing at 7% per year, infrastructure megaprojects are frequently cited as critical drivers for faster economic growth. These large-scale infrastructure projects and megaprojects are projected to revolutionize the country’s communications, transportation, ports, and energy scenarios by 2030, assisting the country in achieving high-middle-income status by 2041.
The banking sector in Bangladesh consists of several types of institutions. Bangladesh Bank is the central bank of Bangladesh and the chief regulatory authority in the banking sector.
There are 61 scheduled banks in Bangladesh who operate under full control and supervision of central bank of Bangladesh which is empowered to do so through Bangladesh Bank Order, 1972 and Bank Company Act, 1991.
There are 6 state-owned commercial banks (SOCBs) that are fully or majorly owned by the Government of Bangladesh.
- Agrani Bank Limited
- Bangladesh Development Bank
- BASIC Bank Limited
- Janata Bank Limited
- Rupali Bank Limited
- Sonali Bank Limited
3 specialized banks are now operating which were established for specific objectives like agricultural or industrial development. These banks are also fully or majorly owned by the Government of Bangladesh.
- Bangladesh Krishi Bank
- Rajshahi Krishi Unnayan Bank
- Probashi Kallyan Bank
There is a total of 43 PCBs in operation right now. They are majorly owned by private entities and classified into two types.
In total 33 conventional PCBs are now operating in the industry. They perform the banking functions in conventional fashion i.e. interest-based operations.
There are 10 Islami Shariah-based PCBs in Bangladesh and they execute banking activities according to Islami Shariah-based principles i.e. Profit-Loss Sharing (PLS) mode.
In total 9 FCBs are operating in Bangladesh as the branches of the banks which are incorporated in abroad.
The Export Policy 2021-2024 has prepared with the aim to almost double Bangladesh’s export earnings to $80 billion from $45 billion within the period by facilitating shipments of diversified, non-traditional goods and labour based products.
The policy prepared for three years also aims to bolster the shipment of high-value products by ensuring standards and compliance as well as encouraging modern, sustainable and green technologies, to cope with the upcoming challenges that will emerge after the country’s graduation from the least developed country category. The policy has given emphasis on product diversification, identification of priority products, expansion of export industries, and making trade and investment easier to boost exports.
Special importance was also given to devise the strategy for the 4th Industrial Revolution, economic diplomacy to expand markets, and bring dynamism in exports. The policy gives priority to the ICT and services sectors, e-commerce, e-governance, and women as well as small entrepreneurs engaged in export-oriented industries. To attain the goal, steps will be taken to identify areas of cooperation among government chambers and related agencies. Specific, time-bound plans will be taken to achieve the targets.
For detail information please visit: www.moc.gov.bd and www.epb.gov.bd
There are two main sea ports in Bangladesh, which are located in Chittagong and Mongla. A lot of large shipping lines (such as Maersk, COSCO, CMA CGM) regularly call and depart from these ports.
Indeed, Bangladesh has a good transportation (air, land and sea) system which greatly facilitates international business between Bangladesh and its trading partners globally. Many well-known airlines such as Emirates, Saudi Airlines, Singapore Airlines and Turkish Airlines have a strong presence in Bangladesh and, making air traffic in terms of passengers and cargo.
In sum, Bangladesh is open for business. International buyers’ and investors’ expectations will be more than met when they choose to come to Bangladesh!