Foreign Investment in Bangladesh: A 2025 Guide to Opportunities, Sectors, and Economic Potential

Author: SRCO Business Insights | April 22, 2025

In the past two decades, Bangladesh has transformed from a struggling economy into one of Asia’s fastest-growing markets. This transformation is the result of rapid industrialization, stable economic policies, strategic reforms, and a young, tech-savvy population. These changes have made the country an increasingly attractive destination for foreign investors from around the globe.

Whether you’re a multinational corporation or an individual investor, understanding the dynamics of foreign investment in Bangladesh is key to making informed investment decisions. This comprehensive 2025 guide explores emerging sectors, current trends, legal protections, practical steps, and how service providers like SRCO BD can help you establish and expand your business in Bangladesh.

Why Bangladesh is Gaining Investor Attention

Bangladesh has emerged as:

• One of the top 40 economies globally (GDP in PPP terms)
• A potential trillion-dollar economy by 2040
• A country with consistent 6–7% annual GDP growth
• Home to a domestic market of over 170 million people

What sets Bangladesh apart from other emerging markets is visible development — roads, bridges, power plants, metro rail systems, and even smart cities are reshaping the landscape. Combined with low labor costs, an increasingly digitized society, and favorable business policies, Bangladesh in 2025 is firmly on the radar of global investors.

Current Trends in Foreign Direct Investment (FDI)

Foreign Direct Investment into Bangladesh reached $3.5 billion in 2024. The trend remains upward despite global economic slowdowns. Leading investors include:

• China: Infrastructure, energy, and light manufacturing
• Singapore: Financial services, real estate, and logistics
• USA & UK: ICT, renewable energy, education, and healthcare
• India: Telecommunications, pharmaceuticals, and consumer goods

BIDA and Bangladesh Bank emphasize increased activity in joint ventures, especially within SEZs and high-tech parks, signaling robust investor confidence.

Key Sectors Open for Foreign Investment

1. Textiles & RMG

• Bangladesh is the world’s second-largest apparel exporter
• Competitive manufacturing costs and a skilled labor force
• Duty-free access to major markets like the EU
• Shift toward green and sustainable fashion manufacturing

2. Energy & Infrastructure

• Strong demand for power generation and renewable energy
• Government offers tax incentives and BOT/PPP models
• Key opportunities in LNG terminals, solar farms, and transmission upgrades

3. ICT & Telecom

• Over 125 million mobile users, 100M+ internet subscribers
• Growth in mobile banking, software outsourcing, and e-commerce
• Scope for investment in edtech, healthtech, and fintech startups

4. Pharmaceuticals & Healthcare

• Government support for API production and healthcare innovation
• Export-oriented manufacturing units enjoy long tax holidays
• Growing demand for modern healthcare infrastructure and services

5. Agriculture & Agro-processing

• High-value crops, aquaculture, dairy, and agro-tech gaining traction
• Investments in cold chain logistics, food processing, and export-oriented agri-business

Step-by-Step: How to Invest in Bangladesh

1. Initial Consultation

• Reach out to BIDA or a consulting firm like SRCO BD for sector-specific guidance

2. Name Clearance

• Submit application via RJSC (Registrar of Joint Stock Companies)

3. Business Licensing

• Obtain trade license from the local municipal office
• Register with the National Board of Revenue (NBR) for TIN and VAT

4. Bank Account Setup

• Open a local bank account for capital remittance and operational transactions

5. Investment Approval & Capital Remittance

• Inform Bangladesh Bank and route funds through official banking channels

6. Compliance Registration

• Enroll for VAT, secure fire/environmental licenses, and industry-specific clearances

7. Office Setup & Recruitment

• Establish a local presence, hire staff, and onboard service providers

8. Ongoing Compliance

• File tax returns, financial statements, and regulatory reports annually

Taxation & Financial Considerations

• Corporate Tax: 22.5% (non-listed companies); up to 40% for sectors like tobacco
• VAT: 15% standard rate; reduced for certain industries
• Withholding Tax: 10–20% on dividends, services, interest (subject to DTT)
• Incentives:
  • 5–10 year tax holidays for investments in SEZs and priority sectors
  • Accelerated depreciation, duty-free import of capital machinery
  • Exemptions from certain withholding taxes for export-focused entities

Challenges & Risk Factors

• Political Uncertainty: Mitigated by strong legal protections and international arbitration (ICSID)
• Infrastructure Deficiencies: Being addressed through mega projects like Padma Bridge, Metro Rail, and deep-sea ports
• Currency & Repatriation: Bangladesh Bank supports foreign exchange remittance, though approval processes can be bureaucratic
• Regulatory Complexity: Procedures vary across sectors; legal advisors like SRCO BD simplify the process
• Bureaucracy: The One-Stop Service (OSS) at BIDA is helping streamline processes, but delays still occur

Special Economic Zones (SEZs) & High-Tech Parks

Over 100 SEZs and IT parks are operational or under development. These include:

• Mirsarai Economic Zone: Coastal industrial hub for garments, steel, and electronics
• Mongla EPZ: Near seaport, good for agro-processing and logistics
• Kaliakoir Hi-Tech Park: Ideal for ICT, software, and data center investments

Benefits include:

• Fast-tracked approvals
• Ready-to-use infrastructure
• Utilities (power, water, internet)
• Access to bonded warehouses and skilled labor

Legal Protections for Investors

• Over 30 Bilateral Investment Treaties (BITs)
• Member of MIGA (World Bank Group) for political risk insurance
• Member of ICSID for investor-state dispute resolution
• Investment Act 2019 ensures equal treatment for foreign investors

Case Studies: Real Success Stories

1. GreenTex (China): Set up a $30M sustainable garment factory in Narayanganj SEZ. Now exporting to Europe and hiring over 5,000 locals.
2. SingPay (Singapore): Launched a digital payments platform in Dhaka via a JV. Scaled to 2 million users within 18 months.
3. PharmaMax UK: Established an API production facility near Dhaka. Enjoys a 7-year tax holiday and exports to Southeast Asia.

Visual Insights (To Be Included)

• Line Graph: FDI inflow from 2015–2024 (BIDA/TradingEconomics data)

Downloadable Resource

[click Here]

• Step-by-step registration guide
• Documents needed
• Estimated timeline and costs
• Sector-specific compliance checklist

How SRCO BD Supports Foreign Investors

SRCO BD is a premier investment consultancy firm helping foreign investors successfully enter and operate in Bangladesh. Their expert services include:

• Business Setup: From name clearance to complete company incorporation
• Regulatory Compliance: TIN, VAT, trade licenses, and industry-specific permits
• Tax Strategy & Filing: Tax planning, DTT application, audit support
• Banking & Capital Structuring: Guidance on repatriation and local banking laws
• Post-Investment Support: Payroll, HR outsourcing, office operations
• Sector Expertise: ICT, RMG, pharma, logistics, agro-processing
• Risk Management: Legal reviews, insurance facilitation, dispute resolution
• Government Liaison: Help with BIDA, BEZA, EPZ, RJSC, and NBR
• Exit Planning: Business dissolution, asset transfer, and tax clearance

🔗 Contact SRCO BD to Start Your Investment Journey

Frequently Asked Questions (FAQ)

Q: Is foreign investment safe in Bangladesh?
Yes. Protected by international treaties, repatriation policies, and arbitration frameworks.

Q: Can foreigners own 100% of a company?
Yes, with few sectoral exceptions (defense, arms, tobacco).

Q: How do I register a business?
Via BIDA’s OSS or through professional firms like SRCO BD.

Q: Are there DTTs?
Yes, with over 30 countries, reducing tax burdens for international investors.

Q: What are common investment hurdles?
Regulatory red tape, infrastructure gaps, and approval delays—but most can be managed with local support.

Final Words: Bangladesh’s Investment Future is Bright

Bangladesh in 2025 is no longer just a low-cost manufacturing hub — it’s a dynamic, digital-forward economy with strong legal protections, young labor force, and expanding global trade ties.

🔗 Visit bida.gov.bd or partner with SRCO BD to turn your investment plans into a thriving business

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