Intellectual Property (IP) and the Innovation Economy: Bangladesh’s Next Growth Engine
Sakif Shamim:
In today’s global economy, the primary drivers of economic growth and long-term success are no longer cheap labor or raw materials. Instead, they are the power of knowledge and innovation, secured by Intellectual Property (IP). Higher profit margins are established when a nation moves beyond merely manufacturing products to owning the knowledge and technology required to create those products. For local industries to secure elevated profits, adopting a strategy focused on IP creation and transitioning to research-based production is now indispensable.
Our economy stands at a critical juncture. International competition will intensify significantly following Bangladesh’s graduation from the Least Developed Countries (LDC) status. To meet this challenge, we must move away from conventional production methods and substantially increase investment in Research and Development (R&D). Unfortunately, Bangladesh currently allocates only 0.03% of its Gross Domestic Product (GDP) to R&D (Planning Commission data, 2022–23). This compares poorly to neighboring countries, such as India at 0.7%, Vietnam at 0.54%, and China at 2.55%. This disparity clearly presents a major obstacle to developing our innovation economy.
However, there is a positive trend: interest in R&D investment from the private sector is growing. According to the Bangladesh Bureau of Statistics (BBS), approximately 72.63% of total R&D expenditure in the 2021 fiscal year came from domestic sources, primarily the private sector. This suggests that our entrepreneurs are starting to prepare for the future.
An innovation cannot remain merely a concept; it must be legally protected. This protection is the foundation of intellectual property. When a company secures its innovation through a patent, copyright, or trademark, it gains an exclusive commercial advantage, which directly paves the way for higher profitability. This strategic move grants the local industry a strong position in the global market.
To achieve higher profitability, our local industry must rapidly embrace this transformation. This necessitates a well-thought-out strategic roadmap. At this pivot point toward a knowledge-based economy, the full implementation of the World Trade Organization’s (WTO) TRIPS (Trade-Related Aspects of Intellectual Property Rights) Agreement presents a significant opportunity for Bangladesh.
The TRIPS agreement establishes international standards for IP protection, helping our local innovators and industries protect their intellectual assets globally. When a country adheres to stringent IP standards like TRIPS, multinational companies are encouraged to invest and transfer technology. For example, global giants like Microsoft or Syngenta feel comfortable operating in a country with their cutting-edge software, seed technology, or chemical formulas when they see international-standard legal protection for their patents and copyrights. By fully implementing the TRIPS agreement, Bangladesh can ensure high-quality IP protection, which will not only benefit domestic innovators but also attract advanced technology and research-based employment through foreign investment, thus building the foundation for sustained, higher economic growth.
It is within this context that I would like to introduce my new venture, LABAID AI. My long experience in the healthcare and technology sectors has led me to understand that future services will be Artificial Intelligence (AI)-based. This newly established institution is pioneering a new horizon in HealthTech. Crucially, LABAID AI has launched with the protection of eight groundbreaking patents. These eight patents set a rare precedent, not only in the wider South Asian region but globally.
The government should provide special tax exemptions to encourage private sector investment in R&D. Currently, excessive R&D expenditure is often treated as revenue and taxed, which discourages investment. It is essential to change this policy and create a separate tax structure for R&D activities.
The Department of Patents, Designs and Trademarks (DPDT) must be modernized, and its legal processes made faster and simpler. Bangladesh’s current weak ranking in the Intellectual Property Rights Index (IPRI) (Global Rank 114/126 in the 2025 IPRI) creates obstacles for foreign investment and technology transfer. Legal protection must be reinforced so that initiatives like LABAID AI can easily protect their innovations.
We must establish strong links between universities, research institutions, and local industry. Academia should be encouraged to conduct market-driven research, and policies must be formulated for the commercialization of innovations. The fact that the talented young domestic workforce built the technology for LABAID AI proves that they can compete globally if given the right environment.
We must shift our focus from apparel and other lower-skilled sectors to high-tech, knowledge-based industries like Pharmaceuticals, ICT, HealthTech, and Engineering. These sectors offer the highest potential for maximizing profits through patents. The Bangladeshi pharmaceutical industry is already showing a positive sign by spending well on domestic R&D (approximately BDT 23,735 per employee).
A successful business is not just about profit and loss; it creates value for the future. I firmly believe that the nation that protects its talent and innovation is the nation that will reach the economic pinnacle. The launch of LABAID AI with eight global patents is more than just a business beginning—it is a clear message in Bangladesh’s industrial history: we are ready to lead the world.
To achieve higher profits and build a sustainable economy, every industrial enterprise must adopt research and innovation as its core mantra. By protecting intellectual property, we will not only safeguard our current assets but also establish a foundation for our future generations to compete in the global marketplace. This path holds the golden gate to the economic prosperity of developing Bangladesh.