Board of Investment

Submitted to: Sheikh Morshed Jahan Course Instructor Bangladesh Studies

Submitted by: Saif Bin Rashid ZR - 62 Ahmed Fai ZR - 6! M" In#amam Alam ZR - $% Maruf &asan 'ir hor ZR - () BBA-)!th Batch

Institute of Business Administration *ni+ersit, of -haka 2$ March. 2%)2

1. An Overview of the Board of Investment (BOI): What is BOI: /he Board of In+estment. Bangladesh or B0I 1as esta2lished under the In+estment Board Act of )(!( 1ith a +ie1 to 3romoting and facilitating in+estment in Bangladesh" At 3resent. the countr,4s dri+e for foreign as 1ell as local in+estors is 2eing s3earheaded 2, this 2oard" It is a high 3o1ered 5o+ernment a3e6 2od, +ested 1ith necessar, 3o1ers to take decisions for s3eed, im3lementation of ne1 industrial 3ro#ects and 3ro+ide o3erational su33ort ser+ices to the e6isting ones 7In+estment Board Act )(!(8" Composition: /he Board is headed 2, the countr,9s :rime Minister and includes Ministers and Secretaries from the concerned ministries and the 5o+ernor of Bangladesh Bank as 1ell as re3resentati+es from 2oth the 3u2lic and the 3ri+ate sectors" It also has an ;6ecuti+e Committee consisting of an ;6ecuti+e Chairman and Mem2ers 1ho are a33ointed 2, the 5o+ernment" /he committee is res3onsi2le for carr,ing out the da, to da, functions and decisions of the Board 1hich are deemed to 2e the decisions of the go+ernment" un!tions and "esponsibi#ities< /he ma#or res3onsi2ilities of the B0I can 2e categori ed into three 3arts In+estment :romotion In+estment Facilitation :olic, Ad+ocac,

/he res3onsi2ilities 1hich come under these categories areIn+estment 3romotion Countr, 3romotion Sector=industr, 3romotions :u2lications on 2usiness 3rocesses

In+estment facilitation :re-in+estment information and counseling ser+ice In+estor 1elcome ser+ice 7faster immigration8 Registration=a33ro+al of foreign. #oint-+enture and local 3ro#ects Registration=a33ro+al of 2ranch=liaison=re3resentati+e offices

A33ro+ing 1ork 3ermit for the foreign nationals Facilitating utilit, connections 7electricit,. gas. 1ater > se1erage. telecom etc"8 Assistance in o2taining industrial 3lots A33ro+ing remittance of ro,alt,. technical kno1-ho1 and technical assistance fees Facilitating im3ort of ca3ital machiner, > ra1 materials A33ro+ing foreign loan su33liers9 credit. :A?; scheme etc Assistance 1ith im3ort clearance and 1arehousing licenses

:olic, ad+ocac, Ad+ocating 3olic, suggestions to the go+ernment Assisting the go+ernment in framing ne1 3olicies for 3ri+ate sector de+elo3ment Assisting the 'ational /askforce on in+estment climate facilitation

Additiona# Servi!es< In addition to these official res3onsi2ilities B0I also 3ro+ides ad+ice and su33ort. on a com3lementar, 2asis. to the 3otential in+estors for setting u3 Business in Bangladesh" /hese Ser+ices includeCourtes, Ser+ice< /he Board of In+estment offers courtes, ser+ice to the +isiting foreign in+estors" /he ser+ice includes Rece3tion at air3ort &otel 2ooking /rans3ort arrangement -ra1ing u3 itinerar, in accordance 1ith their need

/o a+ail of the ser+ices the in+estors are ad+ised to intimate B0I in ad+ance" /he in+esting com3anies can contact B0I an,time to a+ail these ser+ices"

2" $ffe!tiveness: As a result of reformed 3olic, measures undertaken 2, the go+ernment and the Board of In+estment. 3ri+ate in+estments es3eciall, foreign in+estments in the countr, ha+e increased greatl, in the last t1o decades" /his has 2een achie+ed due to ado3tion of +arious 3rograms including holding of seminars=s,m3osiums. 2ilateral talks. 3ress 2riefings and other interacti+e 3rocesses at home and a2road" From )(()-)((2 to )(((-2%%% as man, as )%@)2 industrial 3ro#ects 2oth local > foreign ha+e 2een registered 1ith B0I ha+ing total in+estment outla, of *SA )(%$@ million 1ith em3lo,ment o33ortunities of )@@2B6! 3ersons" -uring that 3eriod a total of ((! industrial 3ro#ects 2oth under #oint +enture and )%%C direct foreign in+estment 1as registered 1ith Board of In+estment ha+ing 3ro3osed in+estment of *SA ))66$million 1ith em3lo,ment o33ortunities of 2B$)B( 3ersons 7Business info Bangladesh8" -uring our inter+ie1s 1e talked 1ith a fe1 in+estors on 1hat the, thought of the Board" From Mr" Manas :aul 72%)28. an em3lo,ee of Rahimafroo 5lo2att Dtd"1e learned that the Board of In+estment authorities 1ere encouraging and facilitating" Similarl, inter+ie1ing Mr" Ahmed Fuad 72%)28 of Che+ron Bangladesh 1e learned that the go+ernment 1as e6tremel, hel3ful in most cases 1hen dealing 1ith them" &o1e+er he admitted that this could 2e due to the fact that the, dealt directl, in the energ, sector 1hich is considered +er, critical"

%. &rob#ems: /he 3ro2lems associated 1ith the Board of In+estment are unfortunatel, man," In C*D/ 72%%E8 the authors argue that in realit,. B0I could not 3la, an effecti+e role in facilitating F-I 2ecause of a lack of e63ertise and ina2ilit, to cut through 2ureaucratic red ta3e" /his is also reflected 2, the lo1 fructification of the registered in+estment" It is 1idel, re3orted that B0I has 2ecome an autocratic 2ureaucrac,. taking unilateral decisions affecting com3anies 1ithout entering into meaningful dialogues" 0ther difficulties in+estors face include dela,s in acFuiring 3ermissions for in+estment. limited rele+ance of in+estment statistics 3ro+ided 2, B0I. non-a+aila2ilit, of a central data2ase regarding sector 3rofiles of the econom, and 3ersistent 3ro2lems in o2taining 1ork 3ermit and entr, +isas" It is e+ident that the most im3ortant 3ro2lems faced 2, the Bangladesh Board of In+estment are the shortage of electricit,. gas. 1ater and other utilities" /he -irector. Mr" A2dul Matin 72%)28 sa,s that foreign in+estors regularl, make demands such as guarantee of electricit, and gas" &o1e+er 1e are una2le to ensure it" /his detracts lots of in+estors" /he 2oard usuall, ends u3 guaranteeing electricit, for E%% da,s a ,ear instead of E6B" &o1e+er the Board of In+estment does not ha+e the a2ilit, to sol+e this 3ro2lem on its o1n" Dand facilities are also scarce in our countr," -ue to 2ureaucratic difficulties it is often not 3ossi2le for the Board of In+estment to secure land in 3rime 1ell-connected areas" /he Board has recentl, taken an initiati+e of allocating areas 2eforehand for in+estment 3ur3oses so that 1hen it is needed there is no sudden crisis" &o1e+er once again. the initiati+e has not 2een +er, successful due to 2ureaucratic 3ro2lems" Mr" A2dul Matin sa,s that the -e3ut, Commissioners all o+er the countr, ha+e 2een telling him that it4s not 3ossi2le and that there is no such a+aila2le land in their areas" &e goes on to sa, that areas such as the ;63ort :rocessing Zones 1hich ha+e good infrastructure and facilities are +er, rare in our countr," A3art from that the Board of In+estment does not ha+e a 3ermanent 2uilding" Mr" A2dul Matin sa,s that the cram3ed office s3ace sometimes creates a negati+e im3ression and lo1ers the morale of staff" &o1e+er a ne1 3ermanent office 2uilding is 3resentl, 2eing made" As for &uman Resource Management 3ro2lems. as 1ith all go+ernment offices there is a shortage of skilled em3lo,ees" A lot of the em3lo,ees do not ha+e the 3ro3er language skills to interact 1ith foreigners or are unskilled" Also a lot of the officers face similar 3ro2lems es3eciall, 1hen re3resenting Bangladesh in international conferences and 1orksho3s" /hese issues 1ere talked a2out 2, Mr" A2dul Matin" It is also seen that there is at times a shortage of creati+it, 1hich is needed for marketing a nation" Ge see that 2oard officials ha+e a fe1 read, made content and s3eeches 1hich the, continuousl, re-use" In her 2log Hirsten Boekhoff 72%%(8 also 1rote a2out some 3ro2lems she faced 1ith the Board In+estment" She 2eing a foreigner starting a small 2usiness on her had some difficult, 1ith 3a3er-1ork 1hich reFuired her to get land and ha+e a 2ank account" /o get land she reFuired a B0I account. and to get a B0I account she needed land" /here 1as a +er, confusing c,cle" *ltimatel, the 3ro2lem 1as sol+ed through a lease" &o1e+er she re3orted that the 3rocess 1as e6tremel, trou2lesome and confusing"

A33ointed foreign em3lo,ees4 1ork 3ermits are authori ed and issued 2, B0I" Mr" Ahmed Fuad 72%)28 an em3lo,ee of Che+ron Bangladesh sa,s that the, face some red ta3e 3ro2lems here" 0ften. the, ha+e to 2ri2e in some le+els of officers 1ho are in charge of this 3rocess" Also. things like these take more time and it can 2e detrimental for com3anies like Che+ron Bangladesh 1here a dangerous accident or shut do1n of an, o3eration unit can ha33en an,time" For this +er, reason. Che+ron Bangladesh has legall, authori ed a Erd 3art, com3an,. 'ational ;nerg, Ser+ices Dimited 7';SD8 to re3resent Che+ron Bangladesh in issuing the 1ork 3ermits of the foreign em3lo,ees" &e then sa,s that +arious additional documents are reFuired 2, B0I to issue the 1ork 3ermit of the foreign em3lo,ees 1hich are not the 1orld 1ide 3ractice in this case" /he M'Cs or foreign com3anies do not kee3 those documents or 1hile o3erating in other countries the, do not need those documents" For Bangladesh. the, ha+e to s3eciall, arrange and make these documents 1hich usuall, take more time and the 3rocess gets com3licated for the M'Cs or foreign com3anies" A strong recommendation for B0I is to ado3t the 1orld1ide standard and 3ractices for issuing 1ork 3ermit to foreign nationals"

'. "e!ommendations: )8 /raining for ;m3lo,ees and 0fficers< /he Board of In+estment needs to ha+e more efficient em3lo,ees" /hese em3lo,ees need to 2e trained in effecti+e communication as 1ell as matters related to in+estment and economics" Better training facilities for officers must also 2e 3ro+ided in communication and in matters related to 2usiness negotiations and la1" 28 Reduction of Corru3tion and Inefficienc,< As this is one of the most im3ortant sectors of the countr, and one 1here the go+ernment is taking initiati+e to im3ro+e. the go+ernment should tr, to remo+e=transfer all officers or em3lo,ees 1ho are sus3ected of corru3tion" Similarl, inefficient officers must 2e transferred as 1ell" /his must 2e 2acked 1ith 2enefits and incenti+es for honest. efficient em3lo,ees" 'onmonetar, 2enefits 1ould 2e the least com3licated to gi+e" E8 Restructuring of Marketing /eam< For ensuring 3ro3er 3romotion. the marketing team needs to 2e restructured to ha+e a team 1hose sole 3ur3ose 1ould 2e to make custom-made 3resentations. gra3hics and materials as 1hen reFuired" /hese 3eo3le also need training in Marketing" @8 Reduce com3lications< /he go+ernment needs to make the 3rocess easier" /his is needed es3eciall, for small and medium enter3rises" ;6cessi+el, com3licated 3a3er1ork can 2e a great source of confusion for man," ;+en for large com3anies. documents 1hich are not reFuired internationall, greatl, ham3ers 2usiness acti+it," B8 0fficers 1ith 5reater :o1er and Rank< As there is great need to co-o3erate 1ith other ministries the officers of the Board of In+estment need to 2e more 3o1erful so that their +oice is heard" :utting officers of higher rank into the Board of in+estment. it 1ould 2e a2le to assist the in+estors to a greater deal" 68 Gings A2road< /o 3romote in+estment to a greater e6tent the Board of In+estment could o3en 2ooths or offices in countries 1ith high 3otential to in+est in Bangladesh" /his could 2e done in colla2oration 1ith the foreign ministries and the em2assies"

"eferen!es: )8 Board of In+estment Ge2site htt3<==2oi"go+"2d= 28 C*/S. 2%%E. In+estment :olic, in Bangladesh I An Agenda for Action htt3<==111"2ei2d"org=images=3u2lication=1hc@f@2a$$a@@fdc"3df. Jie1ed March 2%)2 E8 Business Info Bangladesh< htt3<==111"2i 2angladesh"com=in+estmentK2angladesh"3h3 . Jie1ed March 2%)2 @8 In+estment Board Act )(!(. htt3<==111"sai"uni-heidel2erg"de=1orkgrou3s=2dla1=)(!(a)$"htm Jie1ed March 2%)2 B8 Hristing Boekhoff 72%%(8 htt3<==k2oekhoff"2logs3ot"com=2%%(=%2=com3an,-formation-in2angladesh-3art-@"html Jie1ed March 2%)2 68 Inter+ie1 1ith Mr" A2dul Matin 72%)28 Board of In+estment $8 Inter+ie1 1ith Mr" Ahmed Fuad 72%)28 Che+ron 2angladesh !8 Inter+ie1 1ith Mr" Manas :aul 72%)28 Rahimafroo 5lo2att Dtd