Bangladesh Prime Minister Sheikh Hasina invited Indian companies to invest in the country’s infrastructure sector that requires investments of about $20 billion a year till 2030, promising to exclusively dedicate at least three of the 100 proposed special economic zones in the country for Indian investors.
Speaking at the India Bangladesh Business Forum on Monday, Ms. Hasina, who has a 250-member industry delegation accompanying her, said she would encourage Indian investors to consider investments in Bangladesh in infrastructure projects especially in the energy sector, as well as manufacturing, transport and food processing.
“We need $20 billion annually till 2030 to take full advantage of our high demographic dividend and cheap labour costs,” Ms. Hasina said, stressing that apart from a bilateral investment pact to protect Indian investors, the country was also offering packages that allow 100% repatriation of profits and invested capital by foreign investors.
With a per-capita income of $1,446 and a growth rate of 6% to 7% in the last eight years, Bangladesh offers a fast-growing domestic market of 160 million consumers as well as special duty-free access to various global markets, Ms. Hasina pointed out, expressing hope that the country’s economy will grow at 8% by 2020.
As many as thirteen pacts were signed between Indian and Bangladeshi firms at the summit, entailing investments of about $9 billion. Apart from joint ventures between public sector firms of the two countries, these pacts included a $2-billion deal between Adani Power Limited and Bangladesh Power Development Board for purchasing power from the company’s 1,600 MW Power Plant in Jharkhand.
Made in Bangladesh
Claiming that Ms. Hasina was turning Bangladesh from ‘a basketcase to a miracle case,’ Federation of Bangladesh Chambers of Commerce & Industry president Abdul Matlub Ahmad said he was confident that Indian industrialists would invest about $7 billion into Bangladesh, but called for steps to correct the trade imbalance between the two nations.
Union Minister of State for Petroleum and Natural Gas Dharmendra Pradhan said that bilateral trade between India and Bangladesh had grown 17% in the past five years to reach $6.5 billion, but Bangladesh’s exports have failed to cross the billion-dollar mark.
“I must thank India for allowing duty-free access to Bangladesh goods, but our exports are hovering between $500 million to $750 million. We are not to cross the billion-dollar mark. Why is it so?” Mr. Ahmad asked.
“Indian companies like Emami and Dabur have set up factories in Bangladesh to supply to the local market. Why don’t we look at re-exporting these branded products Made In Bangladesh back to India?” he suggested as a measure to boost its exports to $1 billion.
While the proposed regional connectivity plans such as the Bangladesh Bhutan India Nepal corridor could boost economic ties, Mr. Ahmad said the project wasn’t moving.
“The biggest hurdle is the visa system. Bangladesh gives Indian people a visa so they can enter from any airport or any land port. But when Bangladesh people get a visa from India, we are given either for Petrapole or Agartala or some other place, (entry is) limited to only one point. Unless and until we can change this, it will be very difficult for the regional cooperation to ultimately come in place,” Mr. Ahmad said.
