Dhaka has protested New Delhi's discriminatory policy against Bangladeshi individuals and entities who plan to invest in India.
Officials said India has kept Bangladeshi citizens and companies in "restricted" category for a long time by stating that they can invest only under the "government route" category.
Under this route, prior approval from the government of India is required.
Proposals for foreign investments under this route are considered by respective ministries or agencies.
In its consolidated FDI policy framed in 2017, India kept Bangladesh in the category applicable to Pakistani nationals and organisations.
The rest of the countries in the world were allowed to invest in India under "automatic route".
Under the automatic route category, the non-resident investors or the Indian companies do not require any approval from the Indian government to invest.
Officials said at the recent bilateral commerce secretary-level meeting in New Delhi, officials from Dhaka vented their anger at the denial of opportunity to Bangladeshi investors to invest in India on the automatic route.
Also, they protested why Bangladesh and Pakistan ended up in the same bracket.
At the meeting, officials requested India to lift such restrictions on Bangladeshi investors.
In response to the request from Bangladesh, the Indian side said the issue would be brought to the notice of the departments concerned for review.
A senior official, who attended the meeting, told the FE India has prepared the policy that discriminates against certain countries and Bangladesh has been a victim.
He said India claims that bilateral relation is 'very friendly' and has now reached an 'all time high,' but its discriminatory policy conveys a different message.
Bangladesh has yet to allow, under the present Foreign Exchange Regulation Act, its resident nationals to transfer capital abroad.
Interested individuals or entities can apply to the central bank for permission to invest abroad.
The Bangladesh Bank under sub-section 6 of the section-4 of the law, in consultation with the government, can allow individuals or companies to make equity investment aboard.
In October 2017, local industrial conglomerate Akij Group was given green light to invest US$20 million to acquire a company in Malaysia.
Several applications of some companies seeking permission for outbound investment have remained pending with the central bank, according to officials.
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