Bangladesh is a combination of competitive market, business-friendly environment and cost

structure that can give the best returns. Bangladesh offers a well-educated, highly adaptive and
industrious workforce with the lowest wages and salaries in the region. 57.30 of
the population is under !5, providing a youthful group for recruitment. "he country has
consistently developed a skilled workforce catering to investors needs. #nglish is widely spoken,
making communication easy. Bangladesh is strategically located ne$t to %ndia, &hina and
'(#') markets. Bangladesh has proved to be an attractive investment location with its *+,.,
million population and consistent economic growth leading to strong and growing domestic
demand. #nergy prices in Bangladesh are the most competitive in the region. Bangladesh offers
the most liberal -.% regime in (outh 'sia, allowing *00 foreign e/uity with unrestricted e$it
policy, easy remittance of royalty, and repatriation of profits and incomes. Bangladesh offers
e$port-oriented industrial enclaves with infrastructural facilities and logistical support for foreign
investors.
Prospects of doing business in Bangladesh-
Formation of capital:
0oney making or creating capital is the most important for any business. %n Bangladesh there
have many sector where government and many )123s invest without any interest and gives lone
very easily. -or a good plane here have many financing instate whose financing business.
Low labor costs:
Bangladesh gains its competitive edge mainly from its low labor costs of semi-skilled workers.
"he country has a ade/uate pool of semi-skilled as well as unskilled workers who are willing to
work at very competitive rates, thus enabling Bangladesh to penetrate deep into the hearts of the
international markets, with comparative and competitive cost advantages.
Taxation:
%n Bangladesh some specific sector3s new company can be en4oy ta$ holiday up to *0 years.
'llowances of accelerated depreciation in lieu of ta$ holiday. "a$ e$emption and duty free
importation of capital machinery and spare parts for *00 e$port oriented industries.
Business environment:
"hough in our Bangladesh rules and regulation are changed very rapidly but this all this thing
can be used as positive. Bangladeshi rules mostly changed for the business advantage.
Government promoting5
'griculture 6including fishing7 is the dominant sector in Bangladesh, accounting for !0 of the
1.8. "he manufacturing sector 9 traditionally based on input from domestically produced
agricultural raw materials 9 take up *, of the 1.8. %n order to diversify the country:s industrial
base the 1overnment of Bangladesh is trying to promote private sector investments into many
different sectors.
(ome of the industries offering interesting opportunities for worldwide partners are found
especially in garments;te$tiles, %" < %" related services and food products.
Private EPs:
%n order to stimulate rapid economic growth of the country, particularly through industriali=ation,
the government has adopted an 2pen .oor 8olicy to attract foreign investment to Bangladesh.
-ollowing this, #8>s have been created to provide complete infrastructural facilities including
communication and utility connection where potential investors would find a congenial
investment climate, free from cumbersome procedures. "he Bangladesh 8rivate #$port
8rocessing 'ct allows establishment in private #8>s entirely through foreign investment or
through 4oint ventures or local initiative.
!hallenges of doing business in Banglsdesh-
"mperfect mar#et:
0arket imperfection bleeds the business specially the small players the most. .ominance of the
middlemen in the value chain often cost price distortion. %t is a common scenario for the product
to be sold at a significant premium while the producers take on a huge loss. ?ack of information
and the control e$ercised by these forces cause severe problem for the local producers.
Lac# of efficient distribution channels:
Bangladesh has one of the flattest land structures in the world. "he lack of obstacles 6hills,
desert etc7 and presence of cheaper transportation 6waterway7 makes the country any supply
channel manager:s dream. But unfortunately the real picture is somewhat different. "he
businesses lose near +0 of the perishable it ensue to lack of efficient distribution channel. ?ack
of supply chain management knowledge, a weak transportation system, and corrupt road
authorities are some factors that contribute to make the system inefficient.
Lac# of governance:
-or Bangladesh poor governance is one of the key points what makes the
firm unattractive to investors. "he e$istence of nepotism in the business circle is also something
which makes a firm weak. %t is a common trend among the business community to fill up the
e$isting positions within the firm with their relatives who may not be suitable for the post.
Terrorism:
)ow a day:s terrorism is becoming the cancer of Bangladesh. 'bove discussed political
instability is the reason for it. "his terrorism is also hampering this (mall Business very much.
"oll collectors are very daring and create pressure on the businesses to collect illegal tolls. "here
are also weekly, monthly or special tolls in any religious festival one need to pay. "errorists are
becoming daring day by day. %n recent times they kidnap entrepreneurs and businessmen if they
don:t get the money.
Tax structure:
"he ta$ structure of Bangladesh offers little intensive for a business. 'ccording to the @#"A2
survey Bangladesh holds the second highest corporate ta$ rate among the 'sian countries 6even
after the government has cut the rate to 37.57.
Lac# of connectivit$:
"he world moved on to connect itself to the Borld Bide Beb whereas
Bangladesh is lagging far behind. 'cross the world innovative business are emerging using a
clicks and mortar business model. "hey are leveraging the full potential of the
Borld Bide Beb. 's the access to high-speed internet connection becoming cheaper by the day
around the world the story is /uite different for Bangladesh. Businesses have to pay a handsome
amount in fact one of the world steepest fees to get access to the web.
Lac# of proper business #nowledge:
0ost of the entrepreneurs of Bangladesh apply the traditional hit and miss approach with their
businesses. "hey have little institutional knowledge and have little access to training as very few
organi=ations offer /uality facility. %n absence of know-how relating to general accounting,
branding, ta$ation, law etc the businesses tend to miss the opportunity that the regulatory
environment offers. %nternet can play a vital role here for knowledge dissemination but the access
to the nets not that easy.
!orruption:
"here is very little to add in this point since there is so much uproar from every kind
of mediaabout how corrupt the country is. &orruption isprobably one of the biggest problems fac
ed by theorgani=ations. "he recent drive against corruption is encouraging but unfortunately this
is focused around the urban centers whereas the rural corruption is still rampant.
Poor law and order situation:
Caving a sound law and order situation help flourish business. But the
situationhas deteriorated over the years. Aecent drive toimprove the situation has helped but it
has done damage to the business communities: confidence.
Fre%uent polic$ changes:
8olicies formulated get changed with the government. 's there is serious antagonism between
the main two parties, they tend to undo the work done by their predecessors. "his causes
pain to the business community as the highinvestment pro4ects re/uire serious policyconsideratio
n and longer payback period and suchchanges can create havoc for the pro4ect.
Political instabilit$:
'ccording to a D).8 research strike has led to 3-+ 1.8 losses during the *EE0s."here are
about ,** strikes during *EE5 to !00!. "his creates immense burden on the business firms as the
shops often get vandali=ed during strike violence.
&atural 'isasters:
(heer density of the country3s population- !,,3E people per s/uare mile- makes any natural
disaster a crisis. 'mong the time maga=ine3s list of top *0 natural disasters of !007 Bangladesh is
the only country to be featured twice. "hese disasters disrupt supply chain, damage business and
create untold suffering for the consumers.
(ualit$ of raw-materials:
"he material used to make a product lacks consistent /uality. "he country has to go miles to
achieve the structured type of business that we find common in the developed world. 0odern
/uality techni/ues found wanting in the manufacturing sector of the country. But as the
businesses get more sophisticated they will need /uality materials. 's the recent /uality scare in
&hina proves business has lotmore to lose 6e.g. /uick e$ecution7 than their business.