Enhancing institutional capacity and necessary reforms essential to attract investment
Managing any institution is a holistic economic issue. It is essential to ensure an entrepreneurial-friendly and business-friendly environment for establishing new institutions and initiatives.
There is no alternative to building an institutional foundation for investment to ensure this environment. But if investors cannot be made confident about trade, then this is not possible.
We know that the country’s economy has long been dependent on certain sectors. To overcome this dependence, massive investment is needed in pharmaceuticals, leather, information technology and agro-processing industries.
Increased investment leads to exchange of technology, increases productivity and raises the quality of products or services to international standards. As a result, competitiveness in the global market increases and foreign exchange reserves are strengthened.
Although various policies have been formulated to attract investment, there is no consistency. Thus, the country has repeatedly failed to gain confidence as an investment-friendly country.
Furthermore, the delays and lack of coordination in obtaining services to retain investment have not been eliminated to a large extent.
However, Bangladesh has huge potential for foreign investors. The reasons for not attracting large-scale investment in the country are internal.
They are lack of discipline in the financial sector, political instability, and lack of continuity in investment policies. In addition, the initiatives that have been taken to attract foreign investment have not yet shown any effectiveness.
The expansion of industrialization and the service sector is necessary to ensure quality employment for the large number of new faces entering the job market every year. This expansion requires a huge amount of private investment.
On the other hand, there is no alternative to public investment in infrastructure sectors such as electricity, energy, improved communication systems, and port modernization to attract private investment.
High interest rates, bureaucratic complexities, problems in obtaining land, and lack of policy consistency often discourage domestic and foreign investors.
Legal and administrative reforms are essential to create a sustainable investment-friendly environment. It is necessary to ensure good governance in the banking sector so that genuine entrepreneurs can easily access credit facilities.
Manpower has always been a big potential for us. If we can utilize this manpower, many economic problems can be solved. In this regard, we have examples of India, Vietnam and Mexico.
They have been able to present themselves as alternative centres of supply chains. For this reason, they have not only strengthened the institutional foundation but also ensured the rule of law.
We also need to develop an investment attraction plan based on their comparative investment frameworks.
