Bangladesh Industrial Park and Factory Setup Investment Guide
Setting Up a Factory in Bangladesh: Why, Where, and How
A growing number of Korean companies are considering manufacturing investment in Bangladesh. Key attractions include a minimum wage of around $115 per month, a young labor force drawn from a population of 170 million, preferential tariff access to the EU and U.S. markets, and corporate tax holidays of up to 10 years. The most important decisions in a factory project are site selection (EPZ, SEZ, or general area), facility strategy (build-to-own or lease), and workforce planning.
This guide provides a practical walkthrough of factory establishment in Bangladesh, including industrial estates operated by BEPZA, BEZA, and BSCIC, from initial location review to plant commissioning.
$115/mo
Minimum Wage
Garment sector benchmark
8
EPZs
Operated by BEPZA
97
SEZs
Designated by BEZA
80+
BSCIC Parks
SME industrial estates
$2-8/m²/yr
Land Lease
Varies by location
$200-400/m²
Construction Cost
Depends on structure
$0.08/kWh
Power Tariff
Industrial use
6-18 months
Setup Period
From site to operation
Choosing a Location: EPZ vs. SEZ vs. General Area
Location selection has the greatest impact on the profitability of a factory investment. EPZs generally require exporters to ship most output overseas, although the framework has become more flexible than before. SEZs allow domestic sales, while general areas permit freer land ownership or acquisition. Each option should be assessed against the investor's target market, infrastructure needs, and implementation speed.
Bangladesh generally has an abundant labor supply, so sourcing workers is usually manageable. In EPZs and SEZs, recruitment can be coordinated through the relevant authority's labor support channels. In general areas, companies typically use local agencies and factory-gate announcements. Korean-speaking interpreters and supervisors are often hired from returnees from Korea or graduates of Korean-language programs.
02
Wage Structure
The minimum wage in the garment sector stands at BDT 12,500 per month, roughly $115, with tiered rates by grade. Skilled workers often earn $150-200, line supervisors $200-300, and middle managers $300-500. Two festival bonuses per year are mandatory, and overtime is usually paid at twice the basic wage.
03
Core Labor Law Requirements
Standard working time is 48 hours per week or 8 hours per day, with overtime capped at around 12 hours per week. Paid annual leave generally starts from 10 days, and paid maternity leave is set at 16 weeks. Dismissal typically requires severance of one month per year of service. EPZs operate under a separate labor regime with some procedural differences.
04
Productivity Improvement Strategy
Bangladesh's labor productivity is often estimated at about 60-70% of Vietnam's level, but structured training and industrial engineering methods can materially improve performance. Korean firms have raised output by 20-30% above industry averages by introducing Korean-style production control, incentive-based wage systems, and technical training programs.
05
Dispatching Korean Expatriates
If Korean expatriates are deployed for factory management, E visas and work permits are typically obtained through BIDA or the relevant zone authority. Under BEPZA practice, expatriate staffing is tied to investment size. In the initial phase, it is common to assign three to five Korean managers covering plant operations, quality, and production control.
Factory setup in Bangladesh depends on aligning three variables: location, construction, and workforce execution. EPZs offer infrastructure readiness and administrative convenience, SEZs provide domestic market flexibility and longer tax holidays, and general areas offer greater freedom in land ownership. Initial investment typically ranges from $2 million to $10 million, and companies can materially reduce uncertainty by drawing on the experience and networks of Korean firms already operating in the market.