Study on Foreign Direct

Investment in
Bangladesh
Submitted by
Mohammad Sayed Hasan
ID# 1505054
Major: Finance and Banking
Internal External
 Objectives of the study
To study and review the available scholarly
articles

To find out the inward FDI status in Bangladesh

To learn the factors influencing recent FDI

performance

To evaluate Bangladesh's prospect in attracting

FDI
 Methodology of the study

Secondary sources of data are used

The data are qualitatively analyzed

Trend analysis is used in time series analysis

 Limitations of the study

Unavailability of updated data

Small number of recent research articles

Unavailability of sufficient time

 Foreign Direct Investment

According to IMF, foreign direct investment

reflects the aim of obtaining a lasting interest by a
resident entity of one economy in an enterprise
that is resident in another economy.
 Importance of FDI
Building up physical capital

Creating employment opportunities

Developing productive capacity

Transferring technology and skills

Integrating the domestic and global economy

 Determinants of FDI
Market size

Openness

Labor cost and productivity

Political risk

Infrastructure

Growth

Tax
 Findings
Division among the experts on the impact of FDI on economic
development

Some experts believe positive relationship between FDI and

economic growth

Other experts believe negative relationship between FDI and

economic growth

Another group believe the impact relies on host economy

No substantial contribution by the foreign investments with deep

reliance on import
 Findings
Bangladesh has advantage of:

low cost labor and energy

strategic location

regional connectivity

highly facilitated EPZs

 Findings
Disadvantages of Bangladesh are:

limited supply of electricity and gas

poor infrastructure

corruption

political instability

inadequate skilled workforce

 Findings

Large investment prospect from India in power

and energy sector

Telecom, textiles, banking, gas and petroleum

receive major FDI
 Recommendations
More government investment on infrastructure
and education

More truly export oriented FDI

Establishment of one-stop investment services

center

Improving image of the country

Thank you