Ali, a retired senior diplomat, will replace Tariq A Karim in New Delhi, the foreign ministry said in a media statement on Sunday.
Karim has been the Bangladesh envoy to India for the past five years.
After obtaining his MSc in Zoology from Dhaka University, Syed Muazzem Ali joined the erstwhile Pakistan Foreign Service in 1968.
In August 1971, he declared his allegiance to the Bangladesh Government in exile while working in the Pakistan Embassy in Washington DC.
Later, he played a major role in setting up the embassy of independent Bangladesh there.
Ali, a career diplomat, served as the Bangladesh ambassador to Bhutan, Iran and France.
He also worked at Bangladesh missions in Washington, Warsaw, New Delhi and Jeddah in different capacities.
He had retired after serving as the foreign secretary in 2001.