BIDA wants ‘good’ Companies Act for ease of doing business in Bangladesh

The Bangladesh Investment Development Authority or BIDA, which is working for easing the doing business process in the country, wants a ‘good’ Companies Act for the businesses to flourish.

“We face barriers in many places due to this Companies Act,” Executive Chairman Kazi M Aminul Islam said at a meeting on “sectoral diversification in Bangladesh – combined efforts to achieve goal” on Thursday in Dhaka.

He said almost a decade has been lost to make “the best” Companies Act, but by this time “we could have a good Act”.

“And then [after amendments] we could take suggestions every day and incorporate those to improve the Act to make that the best one,” he said.

Businesses want to amend the existing Companies Act which stands in the way of ease of doing businesses.

Bangladesh is currently ranked 177th among 190 countries in the World Bank’s ease of doing business ranking.

BIDA, which was formed by merging the Board of Investment and Privatization Commission in October last year, set an ambitious target of securing a place below 100 by 2021, which means at least 15 notches improvement would be required a year.

It has also taken steps to take investments across Bangladesh, apart from traditional places of Dhaka and Chittagong zones.

Diversification of export products is another area of its focus as Bangladesh’s export basket is dominated by only ready-made clothes.

Chief Executive Officer of Business Initiative Leading Development, a public private dialogue platform, Ferdaus Ara Begum, said leather and leather goods, light engineering and plastic sectors combined are contributing about $3 billion in export and creating about 2.3 million jobs, of which about 50 percent is for women.  

“If some policy support is given, there is every possibility to increase sectoral export to $10-$12 billion within the next five years,” she said.

She identified some key constraints including lack of skilled workforce, lack of cold storage, lack of access to proper roads, difficulties in getting electricity, lack of awareness of social and environmental compliance, and weak integration of local industries with global value chain.

Ferdaus Ara said their survey found that government usually prepares policies without proper consultation with the private sector and thus increases the cost of doing business. “There are conflicting laws, rules and regulations.”

Private Sector Specialist of the World Bank Hosne Ferdous Sumi said promoting investment requires “holistic approach” to support priority areas.

She also cited global evidence of how countries could diversify their export products.