Private and foreign investment critical for 2041 goals: FICCI

Private and foreign investment critical for 2041 goals: FICCI

Bangladesh is aiming to become a developed economy by 2041, with a focus on elevating living standards and attracting private and foreign direct investment (FDI). The Foreign Investors’ Chamber of Commerce & Industry (Ficci) highlighted several obstacles hindering FDI in Bangladesh, including issues in trade, logistics, infrastructure, investment policy, business regulations, and shortcomings in the financial sector and tax environment.

In its publication titled “Catalyzing Greater FDI for Vision 2041: Priorities for Building A Conducive Tax System in Bangladesh,” Ficci emphasized the critical role of taxation policies, such as corporate income tax rates and incentives, in influencing foreign investors’ decisions. Lower corporate tax rates were noted to correlate with higher FDI, while high tax rates were identified as deterring FDI inflows. Ficci urged for tax reforms aligned with international principles, emphasizing neutrality, effectiveness, fairness, efficiency, flexibility, certainty, and simplicity.

The trade body outlined various challenges in Bangladesh’s investment landscape. Ficci proposed 29 recommendations to enhance the overall investment climate, focusing on business regulations, access to land, infrastructure, logistics, skills, productivity, dispute resolution, trade facilitation, technology diffusion, and access to finance.

Ficci asserted that a more conducive tax environment could lead to increased FDI, projecting figures of $6.6 billion by 2025, $20 billion by 2031, and $50 billion by 2041. The trade body also estimated that tax revenue could rise to $227 billion by 2041 with tax reforms, compared to $98 billion without reforms. Private investment, including FDI, was highlighted as pivotal for Bangladesh to achieve its target of upper-middle-income status, contributing to economic growth, job creation, higher incomes, and improved living standards.

Source: The Daily Star

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