BIDA fails to create impactNo new hope in investment

Despite a change in the political landscape following the 2024 July Uprising, no new momentum has been created in investment and employment over the past one and a half years, raising questions over the effectiveness of the Bangladesh Investment Development Authority (BIDA).

Although BIDA organised an international investment summit last April, officials now said that it will take more time for its impact to be reflected in actual investment inflows.

After the political transition on 8 August, Dr Muhammad Yunus took charge of running the country. BIDA organised the investment summit on 7–10 April last year, which created widespread expectations about fresh investment and job creation.

The interim government spent only Tk5 crore on the event, which drew positive public response at the time.

The summit generated investment proposals worth Tk3,100 crore. However, no significant new proposals have come since then. Instead, in the 2024–25 fiscal year, the registration of domestic and foreign investment proposals with BIDA fell by 58% compared to the previous year, and the negative trend has continued.

Analysts say entrepreneurs and investors, both local and foreign, are now waiting for a national election before making major commitments.

After assuming office in September 2024, BIDA Executive Chairman Chowdhury Ashik Mahmud Bin Harun visited the United States, Japan, the United Kingdom, Qatar, China, Malaysia, Turkey and South Korea by October. In the 2024–25 fiscal year, he officially visited the US in January, Japan in February, the UK in March and Qatar in April.

However, no investment came from Qatar during this period, while net foreign direct investment (FDI) from the UK fell by 40.71%. More capital was repatriated from the US than invested. Compared to the previous fiscal year, investment proposal registrations from Japan and the UK also declined, while no new proposals were registered from Qatar.

According to BIDA data, total registered domestic and foreign investment proposals in the private sector stood at Tk66,057 crore in 2024–25, down 58% from the previous year. The number of proposed projects also declined.

Economists say the interim government should have prioritised removing structural barriers to investment instead of raising unrealistic expectations. Although the one-stop service has been repeatedly promised on paper, it has not materialised in practice. Gas and electricity shortages remain unresolved, with frequent load-shedding continuing even during the winter season. As a result, no improvement has been seen in employment, and a large number of people have become unemployed since 5 August 2024.

According to the latest estimate of the Bangladesh Bureau of Statistics (BBS), the country’s GDP in the current fiscal year stands at around Tk5.5 million crore. However, registered investment intentions remain limited to only Tk1–1.5 lakh crore, which is just 2–3% of GDP.

Actual realised investment is often half or even less due to delays in utility connections, energy shortages and logistical constraints.

Long-standing problems such as bureaucratic inefficiency, corruption and administrative complexity also remain unresolved. Moreover, the absence of an elected government has further deepened the confidence crisis among investors.

China remains one of Bangladesh’s largest sources of FDI stock. The Chief Adviser visited Beijing in March last year, and a large Chinese delegation attended the Dhaka investment summit in April. BIDA’s executive chairman also led a delegation to Shanghai in July, inviting Chinese investors to invest in power, textiles and IT.

Although strong interest and commitments were expressed, these did not materialise. As a result, new investment proposals from China fell by 89% in 2024–25, while net FDI inflows from China declined by 3.3%.

Commenting on the situation, BIDA Chairman Chowdhury Ashik Mahmud Bin Harun said foreign investment does not come overnight in any country.

“Preparing the ground for investment takes time. Bangladesh is no exception. We need to give more time to see the results of last year’s investment summit,” he said.

Meanwhile, country-wise data show a major shift in investor interest. In 2023–24, China, Japan, Singapore, Saudi Arabia and Germany were the top sources of investment proposals. In 2024–25, only China remained in the top five.

South Korea emerged as the largest source last year with proposals worth Tk1,820 crore, followed by China with Tk620 crore, down from Tk5,730 crore the previous year. Proposals from the US stood at Tk410 crore, the UAE at Tk310 crore and Hong Kong at Tk220 crore.

Former World Bank Dhaka office chief economist Dr Zahid Hussain said the decline in investment proposals was expected.

“Bangladesh was in a transitional phase last year. In such a situation, investors naturally hesitate. We have also failed to resolve long-standing infrastructure and opportunity constraints. As a result, investment not only failed to rise, it declined,” he said.

He added that if political stability is restored after an elected government takes charge, the investment climate may improve.