Foreign investors have raised several concerns about the investment climate in Bangladesh, including lengthy customs procedures.
They raised the concern at a seminar on "Investment Climate: Current Landscape and Mission 2041" at the end of a two-day expo organised by the Foreign Investors' Chamber of Commerce and Industry (FICCI) to mark its 60th anniversary on Monday.
Rupali Chowdhury, former president of FICCI and managing director of Berger Paints Bangladesh Limited, said, "We have real problems and we have to solve them."
The discussion was initiated by Yuji Ando, country representative of JETRO (Japan External Trade Organisation). He said that customs procedures in Bangladesh are very slow. He said that if this process can be made quicker, it would help attract foreign investment.
Echoing him, Rupali Chowdhury said, "All the companies are actually facing it."
Commerce Secretary Tapan Kanti Ghosh urged foreign investors to come to Bangladesh and raise their concerns directly, rather than criticising the country from afar.
He said that land has been allocated to Japanese investors in the economic zone in Narayanganj, but not many Japanese investors have come to Bangladesh.
"We don't know if it is because of the customs issue," he said.
Rupali Chowdhury gave a detailed presentation, saying there is a lack of policy consistency.
"When investors invest in an economic zone, there was no value added tax (VAT) on land lease; however, suddenly the policy has changed, and now there is 15% VAT on it. Moreover, investors have to pay more utility charges at the national rate and other surcharges. So, rather than decreasing, Bangladesh Economic Zones Authority's overall charges have increased," she said.
"Electricity is sufficient, but there are issues in getting connections," she added.
Rupali Chowdhury also discussed the National Board of Revenue's (NBR) frequent policy changes.
"We don't know what policy the NBR will bring next year for us. There is a huge revenue collection target for the NBR, and the authorities will try to collect it anyhow from the existing taxpayers, rather than broadening the tax base," she said.
"We are not saying that 100% of businesses are transparent and compliant. But we cannot say that all the processes that the government has developed for ease of doing business are also not responsible," she added.
"There is a discretionary power given to the different bureaucratic processes, so we have to cut down this. It is not a criticism but rather a humble submission," Rupali Chowdhury said.
M Masrur Reaz, chairman of Policy Exchange Bangladesh, presented a keynote paper and pointed out some challenges and prospects of Bangladesh in the case of foreign direct investment.
In the closing remarks, Naser Ezaz Bijoy, president of FICCI, said, "There are a lot of headwinds, but there are also significant potentials."
He especially pointed out the potential of the agricultural business, the digital economy, and other new sectors.
Tofazzel Hossain Miah, principal secretary of the prime minister's office, urged foreign investors to come to Bangladesh and said, "Your engagement will help us to make a conducive environment."
He also urged the private sector to come up with new business ideas, including blue economy, energy exploration, and marine tourism.
"We have worked a lot, but we still have limitations and need to do more," he added.
Samsoo Kim, director general of KOTRA, and Saiful Islam, president of the Metropolitan Chamber of Commerce and Industry (MCCI), also spoke at the seminar.
Dollar crisis hinders LC openings
In a Q&A session, Syed Nasir, Managing Director of Xclusive Can Limited, said, "Due to the dollar crisis, we are unable to open an LC. Our suppliers have not received payments for up to four months. How reasonable is the discussion of the investment climate in such a situation?"
Highlighting the centrality of NBR-related issues in the discussion, Nasir questioned the absence of the NBR chairman, despite the presence of two senior secretaries.
FICCI's Executive Director, TIM Nurul Kabir, attempted to intervene, urging Nasir to refrain from criticism.
In response to Nasir's concerns, the Principal Secretary said, "He should be allowed to speak."
He attributed the challenges to global issues, particularly the Russia-Ukraine war.