Overview of the KDI EIPP Program (2022-23)
The Korea Development Institute (KDI), as the policy consulting partner for the 2022-23 Economic Innovation Partnership Program (EIPP), developed a strategic roadmap for Bangladesh's economic zone development. Its core mandate covered diagnosis of the country's investment climate, advisory support on economic zone operating models, regulatory reform recommendations, and prioritization of infrastructure investment. Over the two-year engagement, the project produced 28 policy recommendations and 5 pilot projects.
Investment Climate Diagnosis
KDI's investment climate assessment used the World Bank's Doing Business framework to identify Bangladesh's structural bottlenecks. The most severe constraints were power supply reliability (ranked 176 out of 190), construction permits (135 out of 190), and tax payment procedures (151 out of 190). The study also confirmed that unstable power supply inside economic zones remains a major factor behind investor hesitation and exit.
| Area | World Bank Rank | Key Issue | Recommendation | Priority |
|---|---|---|---|---|
| Power Supply | 176/190 | 150 hours of annual outages | Dedicated substations for economic zones | Highest |
| Construction Permits | 135/190 | Average 270 days | One-stop permit center | High |
| Tax Payments | 151/190 | 33 taxes, 435 hours | Electronic tax system | High |
| Trade Clearance | 168/190 | 8 days for import clearance | Introduce an AEO scheme | High |
| Contract Enforcement | 189/190 | 1,442 days in court | Commercial arbitration mechanism | Highest |
| Property Registration | 185/190 | 244 days required | Electronic registration system | Medium |
Five Pilot Projects
Based on the diagnostic results, KDI designed five pilot projects: dedicated power stabilization for economic zones, a one-stop investment permit center, a digital customs system, a technical workforce training center, and a commercial arbitration institute. The package was structured at a total scale of USD 45 million so it could be linked to EDCF and KOICA financing.
Core Policy Recommendations
Among KDI's 28 recommendations, the top 10 were positioned as immediately actionable institutional reforms. As of December 2023, the Government of Bangladesh had accepted and begun implementing four of them, was reviewing three, and classified the remaining three as longer-term priorities.