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FOR Bangladesh to catch up with the rest of the world and to reach the millennium development goals, an inflow of foreign direct investment (FDI) in larger volumes is extremely critical in view of the dearth of necessary domestic capital and technology. This is more so in the backdrop of the existing scenario of globalisation and liberalisation and the gradual decline of foreign aid.
Although the existing investment and trade related policies of the government and the incentive package for foreign investors are attractive on paper, the macro-economic indicators are not so favourable. The flow of FDI into the country remains much below compared to that in other countries of the region in spite of campaigns and road shows held by relevant agencies of the government. It is so because of factors like mismatch between the written policies and ground realities at the implementation stage, disturbing political and law and order situation, absence of good governance, rampant corruption, inadequate infrastructure and, last but not the least, non-observance of contract sanctity.
Of late, some new factors like -- a dramatic rise of terrorism and religious militancy have added to the already existing image problem of Bangladesh. These are worrisome for the country; as all these have been sending wrong signals to prospective foreign investors and the non-resident Bangladeshis willing to participate in the development process of their home country.
Unstable fiscal and monetary policies, bureaucratic procrastination coupled with alarming inefficiency and endemic corruption, and long drawn dispensation process are also creating road blocks to investment in general and foreign direct investment in particular. The fiscal and monetary policies of the government change quite frequently and at times -- dramatically -- thereby seriously upsetting one's business plans.
Although more than three decades have passed since Bangladesh has achieved independence, yet infrastructures like power, ports, air transportation and high speed data transmission facility which are vital for attracting investment, remain in shambles. Visible lack of determined efforts on the part of the government for improvement of the situation is frustrating to the concerned citizenry. Repeated appeals of the business community, civil society organisations, prominent think tanks and the development partners of the country to this effect have so far fallen into the deaf ears of the concerned quarters.
Its true that there has been marked improvement in the country's infrastructure facilities over the last three decades. But, simultaneously, these have failed to keep pace with the demands of the time. It is also true that there has been significant inflow of foreign direct investment during the last decade and a half. But it's peanut compared to the volume of FDI inflows in other countries of the region. Complacency in this regard would lead the country nowhere.
Concerned citizens feel very strongly that unless the government takes appropriate measures on a war footing to correct the situation as stated above, Bangladesh would miss the bus and prospective foreign investments would go to other favourable destinations. Posterity would not forgive us for the current inaction.
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The writer is former Secretary, Foreign Investors' Chamber of Commerce & Industry
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