Investment in the country’s private sector declined for the third consecutive fiscal year, which is affecting national economy and standing in the way of job creation.
Private sector investment constituted 23.51 percent of the GDP in the just concluded 2023-2024 fiscal year. It was down from 24.52 percent in 2021-22 fiscal and 23.64 percent in 2022-23 fiscal.
Business leaders blamed the high interest rates, dollar crisis and various other obstacles for the continued decline in investment in the country’s private sector.
Taking into account this grim picture, economists recommend that the economic zones in the country should go into operation soon to boost investment.
Economists said that consumer spending has drastically fallen due to high inflation, which has a negetive impact on the country’s overall production.
They opined that ensuring gas-electricity supply in the private sector, reduction in bank interest and investment-friendly environment can boost investment.
Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President S .M. Mannan (Kochi) said Bangladesh is a promising destination for business and investment for its strategic location, political stability, infrastructural facilities and logistics, He came up with this remark while talking to a visiting Chinese delegation about the Bangladesh’s investment potential.
BGMEA leaders highlighted the potential for Chinese investment in the high-end textiles and backward-linkage industries in Bangladesh.
In the last 2023-2024 fiscal year, the government aimed to increase investment-GDP ratio to 27.34 percent, which requires an additional Tk 193000 crore.
President of the American Chamber of Commerce in Bangladesh (AmCham) Ershad Ahmed said, “If we don’t identify the problems we have, how we will we get investors? In this case, we have to enhance logistics support. We have to devise a good policy. Another thing is, we should have enough money in our banking sector. It is very necessary for the local market.”
The government plans to meet more than half of its budget deficit through bank loans, with a target of Tk 1.37,500 crore for the current fiscal year. Economists argue that this extensive borrowing is hindering industrial investment.
Economist Mustafizur Rahman stressed the need for ensuring a conducive business and investment environment along with effective regulatory frameworks.
Business leaders also stressed the importance of curbing corruption and removing bureaucratic bottlenecks and enhancing port capacities to stimulate investment growth.
