Categories: Economy

Covid 19 impact: FDI inflow into Bangladesh drops

<p>
Inflow of foreign direct investment (FDI) into Bangladesh has fallen by 11 per cent last year as the Covid 19 pandemic hit the global economy forcing many countries to cancel their orders.</p>
<p>
This took FDI in the country to $2.56 billion in 2020 from $2.87 billion in 2019, Dhaka Tribune said. As of April 2020, the country’s garment manufacturers and exporters association estimated that more than $3 billion worth of exports had been canceled or suspended, it added.</p>
<p>
<strong>Also read: <a href="https://www.indianarrative.com/economy-news/th-budget-showcases-bangladesh-s-breakout-from-extreme-poverty-92674.html">50th budget showcases Bangladesh's breakout from extreme poverty</a></strong></p>
<p>
According to data portal Santandertrade, China, South Korea, India, Egypt, UK UAE and Malaysia are the top investors in the country. The data portal also said that while the country ranked 168th out of 190 countries in the World Bank’s Ease of Doing Business index, the government has been actively promoting private sector-led growth. The country also has a healthy foreign currency kitty due to remittances, “and the central bank respects the transferability of foreign currency.”</p>
<p>
A number of more developed Asian countries have outsourced their factory production, mainly textile, to the country.</p>
<p>
“The global flow of FDI has decreased due to the disruptions of the pandemic. But the flow of FDI will largely depend on how we improve the ease of doing business, competitiveness, support mechanisms, infrastructure and ports,” Dhaka Tribune quoted Mustafizur Rahman, distinguished fellow at the Centre for Policy Dialogue (CPD) as saying. Rahman also said that special economic zones,one-stop-service for investors, and infrastructure development would facilitate FDI, only if those are properly developed and implemented, the news organisation reported.</p>
<p>
<strong>Also read: <a href="https://www.indianarrative.com/world-news/india-and-bangladesh-likely-to-sign-free-trade-deal-by-year-end-despite-covid-blues-90418.html">India and Bangladesh likely to sign free trade deal by year-end despite Covid blues</a></strong></p>
<p>
Meanwhile, according to the Daily Star the World Bank said that Bangladesh's manufacturing sector risks becoming uncompetitive because of lower productivity and reliance on low labour costs. Wages are rising locally besides the use of labour-saving technologies is also growing globally. The World Bank report also noted that the export-led manufacturing growth model will remain central to Bangladesh's sustained growth and job creation, but continued reliance on low labour costs to maintain the competitive edge is increasingly untenable as the country consolidates its middle-income status and its wage costs rise.</p>

IN Bureau

Recent Posts

“Indian Armed Forces displayed valour and bravery, scripted new history”: Rajnath Singh lauds Operation Sindoor

Defence Minister Rajnath Singh said on Wednesday that the Indian Armed Forces displayed their valour…

8 hours ago

Ajit Doval speaks with Rubio, NSAs from several other countries after Operation Sindoor; says India’s action measured, non-escalatory

Soon after the focused strikes on terrorists and terrorist infrastructure at nine sites in Pakistan…

10 hours ago

“Very proud of the operation; name is inspiring, to the point”: Israel envoy hails Operation Sindoor

Consul General of Israel at Mumbai, Kobbi Shoshani, on Wednesday hailed 'Operation Sindoor' which was…

11 hours ago

PM Modi meets President Murmu, briefs her on Operation Sindoor

Prime Minister Narendra Modi met President Droupadi Murmu on Wednesday and briefed her on Operation…

11 hours ago

Amit Shah calls meeting with Chief Ministers of various states

Union Home Minister Amit Shah on Wednesday held a meeting with the Chief Ministers and…

11 hours ago

IndiGo cancels flights to eleven cities due to airport closures following Op Sindoor

The budget airline carrier IndiGo on Wednesday cancelled its flight operations in 11 cities across…

11 hours ago