Dhaka, August 30, 2025 — Bangladesh’s investment climate remains a mixed bag. While the country continues to draw proposals and pledges, persistent structural and political barriers are dampening investor confidence and slowing growth.
1. Investment Proposals Keep Rolling In — But Mood Remains Cautious
Bangladesh has garnered $1.25 billion in investment proposals in the first half of 2025 (January to June), signaling clear interest from investors BSS.
Meanwhile, net FDI inflows surged to $864.6 million in Q1 2025 (January–March), marking a sharp 114% rise from the same period in 2024 BSS.
For the full fiscal year 2024–25, total FDI reached $1.71 billion, up nearly 20% year-on-year The Daily Star.
2. Structural Hurdles Undermine Investor Confidence
Despite positive numbers, investment remains subdued in critical sectors:
Capital machinery imports are down 20–25%.
The construction sector is showing signs of slowdown Dhaka Tribune.
According to experts, political instability, energy shortages, bureaucratic red tape, and extortion by tax officials are major obstacles for private investment Apparel ResourcesThe Financial Express.
The Policy Research Institute (PRI) emphasizes that addressing energy supply, logistical bottlenecks, and political uncertainty is imperative to unlock new investment opportunities Bangladesh Post.
3. Calls for Reform and Policy Stability
The Bangladesh Bank is urging the adoption of a rule-based monetary policy to ensure long-term stability, with a goal of keeping inflation around 4% BSS.
Economic commentators argue that reform rhetoric must translate into tangible results, especially to sustain investor trust beyond the interim government's term Future StartupThe Daily Star.
4. Summit Buzz and Global Engagement
The Bangladesh Investment Summit 2025, held in April, drew over 550 foreign investors from 50 countries and featured participation from companies like Inditex, Handa Industries, and Holcim Group The Financial ExpressThe Daily Star.
At the event, Handa Industries committed $150 million across textile and garment sectors The Daily Star.
Investor visits to the Korean Export Processing Zone (KEPZ) in Chattogram highlighted improvements in infrastructure, streamlined licensing, and worker amenities, showcasing a more investor-friendly environment The Financial Express.
5. Beyond FDI: Strategic Partnerships & Regional Moves
Bangladesh continues to draw strategic international interest. Notable developments include:
Japan’s announcement of $1.06 billion in budget support, covering infrastructure and education Reuters.
China discussing reduced interest rates on loans; renewed commitments to invest in manufacturing and negotiate trade and investment treaties Reuters.
Earlier proposals by the European Investment Bank (EIB) to double funding to €2 billion, though concerns about political stability and human rights linger AP News.
Bottom Line: Fragile Momentum, But Potential Persists
Despite headwinds, Bangladesh continues to draw investment interest. Fiscal early-year numbers show renewed inflows and trust, while summits and bilateral engagements hint at longer-term possibilities.
However, investment growth remains fragile. To translate interest into sustained capital—and to meet ambitious development plans—Bangladesh must:
Ensure political and policy stability.
Bolster energy, logistics, and regulatory frameworks.
Deliver on reform promises with concrete, systemic improvements.