Investment Facilities in Bangladesh

Bangladesh offers an unparalleled investment climate compared to the other South Asian economies. Here are eight key pointers to Bangladesh’s investment climate today.

Bangladesh is a largely homogeneous society with no major internal or external tensions and a population with great resilience in the face of adversity (e.g. natural calamities).

Bangladesh is a liberal democracy. The population of this country irrespective of race or religion have been living in harmony and understanding for thousands of years.

Broad non-partisan political support for market oriented reform and the most investor-friendly regulatory regime in South Asia.

Trainable, enthusiastic, hardworking and low-cost (even by regional standards) labor force suitable for any labor-intensive industry.

The geographic location of the country is ideal for global trade, with very convenient access to international sea and air routes.

Bangladesh is endowed with abundant supply of natural gas, water and its soil is very fertile.

Although Bengali (Bangla) is the official language, English is generally used as a second language. The majority of the educated population can read, write and speak in English.

As a result of low per capita GDP, present domestic consumption is not significant. However, it should always be considered that there exists a middle class with over 10% of the population. As economic growth picks up, the purchasing power will also grow substantially.

Bangladeshi products enjoy duty free and quota free access to almost all the developed countries. This access to the global market is further helped by the fact that the policy regime of Bangladesh for foreign direct investment is by far the best in South Asia. Most Bangladeshi products enjoy complete duty and quota free access to EU, Canada, Australia and Norway. Though in limited scale, Bangladesh products already found their access with lower duty in the markets of Thailand, India and Pakistan. However, talks are underway with China, Russia, Malaysia and other neighbouring countries in this regard.

List of incentives granted:

Bangladesh´s tax incentives and benefits are standardized. They apply to any and all companies according to their operation, so there is no need for negotiation on a per case basis. In addition, entities wishing to set up operations in areas outside the Greater Industrial Area can enjoy greater benefits. Discover the option according to your needs.

Incentives & Benefit for Developers:


Income tax exemption on income derived from the business development of EZ in a block of 10 years in 15 years. After expiry of 10th year tax exemption will be 70% in 11th year and 30% in 12th year. But the tax exemption will not be applicable from 13th year.


Exemption of VAT on electricity or taxes on sale, of self generated or purchased electric power for use of processing area of EZ (for 10 years).


All purchase excluding petroleum product from Domestic Tariff Area (DTA) shall be exempted from VAT, sales tax etc.


TAX HOLIDAY For all Economic Zones Income Tax Holiday (ITH)- 1st and 2nd year 100%, 3rd year 80%, 4th 70%, 5th 60%,6th 50%, 7th 40%, 8th 30%, 9th 20% and 10th year 10%.
CUSTOM DUTY Duty free import of raw materials, construction materials, capital machineries, finished goods.
INCOME TAX-OTHERS Exemption from dividend tax (After tax holiday over)
REPATRIATION Full repatriation of capital and dividend.
FREE FLOW FDI No ceiling of FDI.
BACKWARD LINKAGE 100% backward linkage raw-materials and accessories to sell for export oriented industries( EOI) in Domestic Tariff Area( DTA).
LOCAL SALE 20% sale of finished product to DTA (From Export Processing Area –EPA).
SUB- CONTRACTING Sub-contracting with DTA allowed.
STAMP DUTY 50% exemption of stamp duty and registration fees for registration of leasehold land/ factory space.
VAT 80% exemption of VAT on all utility services consumed inside the zone.
CUSTOM DUTY Duty exemption on Export.
CD ON VEHICLE Exemption of CD for import of 2 vehicles within 1st 5 years for foreign investors.
DOUBLE TAXATION Exemption of double taxation subject to Double taxation agreement.
IT INDIVIDUAL 50% Rebate of income tax on salary income of expatriates for 5 years.
CUSTOM BOND Consider EZ as custom bonded area.
FOREIGN EXCHANGE FC loan availability (To ease business activity).
FC Account for Non-Resident.
FC Account for both local and joint venture industry.
JOINT VENTURE Joint venture allowed.
ROYALTIES Royalty, technical fees will be exempted from income tax.
CAPITAL GAINS Tax exemption on capital gain.
SHARE TRANSFER Share transfer allowed.
WORK PERMITS Work permits – No restrictions on issuance of work permits on project related foreign nationals and employees but limited up to 5% of total employees.
RE- INVESTMENT Re-investment of remittable dividend to be treated as new foreign investment.
RESIDENT Resident visa for investment of US$ 75000 or more.
CITIZENSHIP Citizenship for investment of US$ 500000 or more.