Foreign Direct Investment Promotion Project (FDIPP)

Bangladesh has been averaging relatively high annual GDP growth rate at 5 to 6 % over the past 10 years. However in order to achieve a transition to a middle income nation by 2021 as the country envisions as its national goal, the country needs to accelerate its GDP growth rate to about 8%. To realize this goal, the country needs to break away from the existing economic structure that is heavily relying on garment exports and remittance from overseas workers.

Moreover, it is essential that the country should seek diversification of the national industries and exports, and promote investment and strengthen industries with a focus on manufacturing industries that have competitiveness in export. Therefore, it is necessary for the country to improve the system, the administration and the implementation capacity of the pertinent government agencies responsible for the promotion of investment and industrial development. 

The government of Bangladesh has announced that no new EPZ is needed, but instead, it has launched a new policy to establish “Economic Zones (EZs)” to reinforce enter industrial relationship of export industry and domestic industry, and to optimize the domestic market.

Under these circumstances, the government of Bangladesh has requested the government of Japan to provide Yen loan for “the Foreign Direct Investment Promotion Project (hereinafter FDIPP)” in order to establish a new EZ mainly targeting Japanese companies and to further facilitate investments from Japan. The loan agreement for FDIPP was already signed in December 2015. The loan is expected to provide both short term and mid to long term low interest financing for operation and capital investment of the EZ. Additionally, a part of the loan will contribute to the development of infrastructure such as roads, power and gas, as well as to assure the involvement of the government of Bangladesh to resolve and simplify the complicated system and procedure s so that Japanese companies can be more confident and comfortable about their investment decision.

Taking into consideration the site location, available infrastructure, existing industries, investors interest and infrastructure and logistic requirement of the proposed industries, Araihazar Economic Zone is more like to be selected for EZ development through FDIPP.

The proposed Araihazar Economic Zone (AEZ) site is located at Mouza: Panchrukhi, Panchgaon, Union: Satgram & Duptara, under Araihazar Upazila, which is adjacent to the Dhaka Sylhet highway. The project area is mainly covers agricultural low land.

The total land of Araihazar Economic Zone (AEZ) is approximately 218.84 ha. Upon completion, AEZ is envisaged to create approximately 10,000 jobs when fully occupied by investors.

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