Bangladesh needs to amend tax rules, simplify business procedures and ensure facilities for international investors to attract foreign direct investment, said speakers yesterday.
"It is crucial than ever to bring FDIs to tackle the Covid-19 fallout. For this reason, the government should relax rules and ensure competitive facilities," said Mohammad Abdur Razzaque, chairman of the Research Policy Integration for Development (RAPID), a think-tank.
Syed Nasim Manzur, managing director of Apex Footwear, alleged that the local tax system was not business-friendly, making it a significant obstacle to transforming Bangladesh into a manufacturing country.
The tax system discourages the FDI to flow to Bangladesh, he said.
They commented while addressing a webinar on "FDI for Export Diversification and Smooth LDC Graduation", organised by the Economic Reporters' Forum (ERF) in collaboration with the RAPID and The Asia Foundation.
The Bangladesh Investment Development Authority (Bida) can't directly work to improve the ease of doing business due to a lack of authority, said its Executive Chairman Md Sirazul Islam.
"The Bida has to contact concerned authorities to perform any action or reform activities," he said.
In some cases, the concerned authorities agree with the Bida, but usually, they waste time or do not take the initiative to fulfil its request, which is a big obstacle to bringing rapid change, he added.
For example, foreign investors and workers who availed visas for Bangladesh through the Bida had asked the organisation to manage Covid-19 vaccines for them.
The Bida has held meetings with the foreign ministry and the health ministry to arrange the coronavirus jab, Islam said. It is yet to provide vaccines to the roughly 15,000 foreigners working in Bangladesh.
"It is a matter of the country's image that the government would manage vaccines for foreigners, who would appreciate the initiative. This would help attract more FDIs," he added.
Islam also said that Bida had taken measures to set up two separate courts to deal with commercial disputes quickly and suggest updates on the arbitration act.
"We are continuously working to attract more FDI," Islam said.
Planning Minister MA Mannan said there was a lack of follow-up on the work done in Bangladesh even though the rules and laws are in place.
He urged government officials to create a more business-friendly environment and asked investors to push the concerned government offices to complete their work on time.
"Since the investors are free, they can create pressure on the government in this regard."
Nihad Kabir, president of the Metropolitan Chamber of Commerce and Industry, said: "If we want to bring FDI, we have to cooperate with the Bida and the country's businessmen. That way, both sides will be able to identify weaknesses to attract FDIs."
She went on to say that the business community in Bangladesh was not given the proper recognition, and the media solely focused on the negatives, which is another obstacle to attracting FDIs.
Kabir also said that both Bida and the National Board of Revenue did not have any research on local businesses.
There are even excellent officials in both offices that have no idea about business, she added.
Rizwan Rahman, president of the Dhaka Chamber of Commerce and Industry, urged the government to nurture non-readymade garment sectors to double export earnings.
The target on export diversification can't be achieved without giving attention to the non-readymade garment sector, he said.
Regarding the provision of amnesty on the untaxed income in the national budget, Rahman said it was discouraging as untaxed money-holders get an exemption of about 22 per cent.
Presided over by M Shafiqul Alam, ERF vice-president, Prof Abu Eusuf, executive director of the RAPID, Kazi Faisal Bin Seraj, country representative of the Asia Foundation, and SM Rashidul Islam, general secretary of the ERF, addressed the webinar.