Bangladesh Investment Guide 2021 Overview
Bangladesh's FDI inflows reached USD 2.9 billion in FY2020-21, recovering to pre-COVID levels. The government is improving the foreign investment environment through the Investment One-Stop Service (OSS), a 100-zone Special Economic Zone (SEZ) development program, and an expanding public-private partnership (PPP) framework. Korean company interest is concentrated in garment, electronics, food, and energy sectors, with BIDA and BEZA serving as the primary investment promotion agencies.
Investment Incentives and Tax Benefits
Bangladesh offers differentiated tax benefits across Export Processing Zones (EPZ), Special Economic Zones (SEZ), and Hi-Tech Parks (HTP). Key incentives include corporate tax exemption for up to 10 years, duty-free import of machinery and raw materials, unrestricted profit repatriation, and export income tax exemption.
| Incentive | EPZ | SEZ | HTP | General |
|---|---|---|---|---|
| Corporate Tax Exemption | 10 years | 10 years | 10 years | None |
| Customs Duty Exemption | Machinery and raw materials | Machinery and raw materials | Machinery and raw materials | Partial |
| Profit Repatriation | Unrestricted | Unrestricted | Unrestricted | Restricted |
| Export Income | Tax-exempt | Tax-exempt | Tax-exempt | Taxable |
| Land Lease | 99-year long-term | 50+ years | 30+ years | Negotiable |
| VAT | Exempt | Exempt | Exempt | 15% |
Priority Investment Sectors
High-value-added garment and textiles, electronics and appliance assembly, food processing, energy and infrastructure, and IT software are the priority investment sectors in 2021. In particular, the China+1 strategy is accelerating manufacturing relocation in garment and electronics, with Korean company inquiries for SEZ entry increasing accordingly.