The New Nation - Internet Edition

FOREIGN direct investments (FDIs) are important because investments hold the key to economic growth which in turn leads to creation of jobs and increase of wealth for economic expansion. But FDIs into Bangladesh continue to be far less than the potential. Major foreign investors in some cases are losing their interest and this is a cause of concern. The United States and Japan are the leading foreign investors in Bangladesh. The embassies of both countries last year handed over reports to the government in which they expressed their dissatisfaction with the environment for foreign investments. Clearly, the government in Bangladesh needs to take these evaluations seriously and act in response to them.

The evaluation of the FDI scene, specially the one done by the Japanese, highlighted that the government then seemed to be completely uncaring about the difficulties pointed out by the foreign investors from time to time. The report stressed that governments of other countries which aspire to receive FDIs usually conduct surveys on their own to learn about what difficulties foreign investors face. They then take steps swiftly to remove them. But our government has not been seen engaging in such fact-finding exercises. One very serious problem stressed in the reports of the Japanese and US embassies was the lack of continuation of policies. Investors seek continuation of policies regardless of changes of government for the safety and viability of their investment in medium and long terms. But a successor government in Bangladesh tends to refuse to see the merit of the policies of its predecessor in some cases. Thus, foreign investors find it difficult to invest with medium or longer term objectives as government policies here fluctuate and add to risks to their investments.

The reports further underscored the gulf between the pledges and the reality in Bangladesh. The pledged one-stop service at the Board of Investment (BOI) is still not a reality. They also complain about delaying and frustrating bureaucratic procedures that undermine their interest to invest. Unreliable electricity supply is found to be a serious problem. Power supply is unsatisfactory even in the export processing zones (EPZs) where the foreign investments are concentrated. The efficiency of the Chittagong port has improved notably in recent months but more facilities at this port and related support in other areas of the country are needed to convince foreign investors that vital infrastructures in this country are competitive.

The reports also pointed to the weekly working days. Offices in Bangladesh close practically from Thursday evening and Friday is a full holiday. In other parts of the world, Saturdays and Sundays are holidays. The government needs to take these reports from the two biggest foreign investors very seriously. If increase of foreign investments is really desired, then the grievances of the foreign investors must be addressed properly.