Bangladesh received investment proposals worth $1.25 billion during the first six months of 2025, demonstrating renewed investor confidence in the country's economic prospects despite ongoing challenges, according to the Bangladesh Investment Development Authority (BIDA).
The Investment Coordination Committee's fifth meeting, chaired by Chief Adviser's Special Envoy on International Affairs Lutfey Siddiqi at the Chief Adviser's Office, revealed that the investment proposals comprised $465 million in foreign investment, $700 million in domestic investment, and $85 million in joint venture investments.
China Leads Foreign Investment Interest
Chinese firms dominated foreign investment proposals, submitting nearly $330 million worth of investment plans, representing over 70% of all foreign investment proposals. Significant investment proposals also came from institutions based in Singapore, the United States, and the United Arab Emirates, indicating diversified international interest in Bangladesh's market.
The strong Chinese interest builds on existing commercial ties, with Chinese firms having invested $283 million in FY2023-24, making China the third-largest foreign direct investment (FDI) source for Bangladesh with a total investment stock of $1.56 billion.
Conversion Rate Exceeds Global Average
BIDA officials reported that $231 million of the total proposals have reached the final stage, representing an 18% conversion rate from initial proposal to advanced implementation stage. This conversion rate is notable as it meets the global average of 15-20% for investment proposal conversions.
Nahian Rahman Rochi, head of business development at BIDA, emphasized that around 20% of the proposals have reached advanced stages, including signed agreements, land lease confirmations, and letters of allotment. The remaining proposals are distributed across various implementation phases, with approximately 60% still in exploratory stages involving feasibility studies and early-stage discussions.
Special Economic Zones Drive Investment Interest
The investment surge reflects growing interest in Bangladesh's Special Economic Zones (SEZs), which continue serving as a cornerstone of the government's industrialization strategy. The Bangladesh Economic Zones Authority (BEZA) aims to establish 100 SEZs by 2030, targeting the creation of 10 million job opportunities and generating $40 billion in exports.
"The figures indicate rising investor interest in Bangladesh's special economic zones, which continue to be a core pillar of the government's industrialization drive," Rochi stated during a briefing with journalists at the BIDA auditorium in Dhaka.
Robust FDI Performance in Early 2025
The investment proposals complement strong actual FDI inflows recorded earlier in 2025. Net foreign direct investment surged to $864.63 million in the first quarter of 2025, representing a 114% increase from $403.44 million in the same period of 2024.
The FDI growth was driven by a sharp rise in intra-company loans, which reached $626.97 million, nearly two and a half times the $253.80 million recorded a year earlier. Equity investments also increased significantly to $304.38 million from $188.43 million in the previous year.
Investment Infrastructure Modernization
To improve transparency and streamline processes, BEZA is developing a Unified Investment Portal that will integrate investment status data, zone-specific developments, land availability, and approval timelines. The platform aims to standardize data-sharing across departments and enable real-time tracking of investment progress.
"Currently, updates are often fragmented across agencies," explained Major General (Retd) Md Nazrul Islam, executive member (planning and development) at BEZA. "This platform will standardize data-sharing and align decision-making processes across departments."
BEZA has also launched a dedicated research unit supported by international consultants to identify high-potential sectors including rubber, furniture, pharmaceuticals, and tourism.
Economic Context and Challenges
The positive investment figures emerge against a backdrop of mixed economic indicators. While Bangladesh's economy shows signs of stabilization driven by tight monetary policy and robust export performance, overall investment activity remains subdued.
Capital machinery imports have declined by 20-25%, and construction sector growth has decelerated sharply, indicating broader challenges for economic expansion and job creation. The Policy Research Institute noted that both public and private investment have stagnated, with public investment projected to fall to 6.4% of GDP in FY25.
Despite these challenges, business leaders remain cautiously optimistic. The World Bank projects Bangladesh's GDP growth to moderate to 3.3% in FY25 before recovering, while the Asian Development Bank forecasts 3.9% growth in FY2025, rebounding to 5.1% in FY2026.
Strategic Importance for Economic Development
The $1.25 billion in investment proposals represents a critical component of Bangladesh's economic diversification strategy. With plans to establish government-to-government economic zones with India and initiatives to attract climate-smart investments, Bangladesh is positioning itself as a competitive destination for sustainable foreign investment.
"Our focus is not just on the volume but also on the quality and sustainability of investments," Rochi emphasized. "If this momentum continues and facilitation becomes more streamlined, the next five months could yield even more impactful outcomes."
The investment proposals, combined with ongoing infrastructure development and regulatory reforms, signal Bangladesh's potential to maintain its position as an attractive investment destination in South Asia despite regional economic uncertainties and domestic challenges.
As these proposals move through various stages of implementation over the next 12-24 months, their successful conversion into operational projects will be crucial for Bangladesh's economic growth, employment generation, and export diversification goals.
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