New investments slows in the country

Former FBCCI president and Ha-Meem Group managing director AK Azad addresses the seminarProthom Alo

The government has raised the value-added tax (VAT) rate on certain products without assessing its impact on the public. Similarly, decisions to increase gas prices are being made without consulting the business community, both of which negatively affect investment.

These observations were made by AK Azad, former president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) and managing director of Ha-Meem Group, during a seminar on Wednesday.

At the same event, former president of the Dhaka Chamber of Commerce and Industry, Abul Kasem Khan, criticised the National Board of Revenue (NBR) for harassing businesspeople.

He highlighted frequent policy changes driven by vested interests and a lack of policy continuity.

He further noted that the private sector is often excluded from the policymaking process, which hinders business growth and investment.

The seminar, titled Investment Prospects and Challenges, was organised by the Economic Reporters Forum (ERF), an organisation of economic journalists.

The event was attended by Bangladesh Investment Development Authority (BIDA) Executive Chairman Chowdhury Ashiq Mahmud Bin Harun as the chief guest.

How could this happen? Businesspersons are being treated like criminals. They’re saying the price of gas will rise from Tk 30 to Tk 75, claiming it won’t affect the industry! If it truly won’t affect the industry, I’m willing to hand over all my factories - let them run those
Former FBCCI president and Ha-Meem Group managing director AK Azad

Other speakers included FBCCI administrator Md. Hafizur Rahman, LafargeHolcim Bangladesh Chief Executive Officer (CEO) Mohammad Iqbal Chowdhury, and BIDA’s business development chief Nahian Rahman. 

ERF president Daulat Akhter Mala presided over the seminar at the organisation’s office in Purana Paltan, Dhaka, while General Secretary Abul Kashem moderated the discussion.

BIDA Executive Chairman Chowdhury Ashiq Mahmud Bin Harun refrained from commenting extensively on the statements made by AK Azad and Abul Kasem Khan.

He mentioned only that he would discuss the VAT issue with the NBR Chairman.

Highlighting BIDA’s efforts to attract investment, he noted that 19 sectors have been identified, with a focus on eight of them in the near future.

The executive chairman emphasised the need for a centralised authority to streamline investment promotion. According to him, having a single authority would eliminate the need for individuals to approach multiple organisations.

He pointed out that many government institutions possess unused resources, which could be utilised for industrialisation.

While he did not explicitly state it, Chowdhury Ashiq alluded to the possibility of merging the Bangladesh Economic Zones Authority (BEZA), BIDA, and similar organisations into a single entity.

Some say it’s 12 per cent, others say 27 per cent, and some even claim it’s 48 per cent. There’s no such policy inconsistency anywhere else in the world
DCCI ex-president Abul Kasem Khan on lack of clarity regarding effective tax rate in Bangladesh

He cited the formation of BIDA itself, which resulted from the merger of the former Privatisation Commission and the Board of Investment, as a precedent.

Former FBCCI president and Ha-Meem Group managing director AK Azad raised concerns about inefficiencies in the gas supply system, claiming that 10 per cent theft occurs under the guise of system loss.

He argued that curbing this theft would eliminate the need to raise gas prices.

Azad remarked that only an interim government, free from electoral pressures, could effectively address such systemic issues.

AK Azad emphasised that while existing companies are focusing on expansion and modernisation, new investments are not materialising.

He questioned, “How could this happen? Businesspersons are being treated like criminals. They’re saying the price of gas will rise from Tk 30 to Tk 75, claiming it won’t affect the industry! If it truly won’t affect the industry, I’m willing to hand over all my factories - let them run those.”

Former president of Dhaka Chamber of Commerce and Industry (DCCI), Abul Kasem Khan highlighted the lack of clarity regarding the effective tax rate in the country.

“Some say it’s 12 per cent, others say 27 per cent, and some even claim it’s 48 per cent. There’s no such policy inconsistency anywhere else in the world,” he said.

He further criticised widespread corruption, stating, “All sectors have been destroyed because of corruption. This must end, and institutional reforms must be implemented.”

FBCCI administrator Hafizur Rahman pointed out that the current VAT and tax arrangements discourage businessmen from investing.

Mohammad Iqbal Chowdhury, CEO of LafargeHolcim Bangladesh, remarked that while roadshows have been conducted abroad to attract new investments, it is crucial to first understand the current investment scenario within the country and address its challenges.