FDI inflow up in July-Jan period
Thursday, 16 April 2009
FHM Humayan Kabir
Foreign direct investment (FDI) in Bangladesh shot up by 78 per cent in the first seven months of the current financial year, which will boost the country's economy, experts said.
During July to January period of fiscal 2008-09, the country received US$764 million in foreign direct investment against only $430 million in the same period in FY08, Bangladesh Bank said.
The FDI flow in seven months in current fiscal is also 18 per cent or US$114 million higher than the total investment of US$650 million in FY08, the central bank said.
"It's a great news for Bangladesh. At last, the poor FDI trend of last couple of years has reversed maintaining a significant growth," Zaid Bakth, research director of Bangladesh Institute of Development Studies (BIDS), told the FE.
He said: "Since Bangladesh has abundant cheap labour, some manufacturers of different countries, including China, have been relocating their units in the country."
Besides, the political stability after the general election has also enhanced chance of higher FDI in Bangladesh, he added.
Experts said during the interim government period imposition of the state of emergency had affected the FDI flow to Bangladesh.
In FY2007, the Bangladesh received $793 million worth of foreign investment, which declined to $650 million in FY2008.
Zaid Bakth said some Chinese investors have already been started relocating their textile and ready-made garment factories in Bangladesh due to higher labour cost and the affect of the global recession there.
"If the government can improve the power and energy supply situation and create an investment-friendly environment, I think there will be big jump in FDI flow," the BIDS researcher said.
Foreign direct investment (FDI) in Bangladesh shot up by 78 per cent in the first seven months of the current financial year, which will boost the country's economy, experts said.
During July to January period of fiscal 2008-09, the country received US$764 million in foreign direct investment against only $430 million in the same period in FY08, Bangladesh Bank said.
The FDI flow in seven months in current fiscal is also 18 per cent or US$114 million higher than the total investment of US$650 million in FY08, the central bank said.
"It's a great news for Bangladesh. At last, the poor FDI trend of last couple of years has reversed maintaining a significant growth," Zaid Bakth, research director of Bangladesh Institute of Development Studies (BIDS), told the FE.
He said: "Since Bangladesh has abundant cheap labour, some manufacturers of different countries, including China, have been relocating their units in the country."
Besides, the political stability after the general election has also enhanced chance of higher FDI in Bangladesh, he added.
Experts said during the interim government period imposition of the state of emergency had affected the FDI flow to Bangladesh.
In FY2007, the Bangladesh received $793 million worth of foreign investment, which declined to $650 million in FY2008.
Zaid Bakth said some Chinese investors have already been started relocating their textile and ready-made garment factories in Bangladesh due to higher labour cost and the affect of the global recession there.
"If the government can improve the power and energy supply situation and create an investment-friendly environment, I think there will be big jump in FDI flow," the BIDS researcher said.