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Home>>> Business Programmes & Policies>>Encouraging credit policy .....

A. Policy for BSB's own investment :

  • Debt equity Ratio ranging from 50:50 to 60:40 depending upon the nature of the project, repayment capability, sponsor credit worthiness etc.
  • Investment Limit Taka 10 crore in a single project but above Taka 10 crore may be financed in syndication.
  • Working capital loan for BSB-financed projects, especially, for operative and profitable projects under the branch offices of the bank.
  • BMRE (Balancing, Modernization, Replacement and Expansion) facility given to regular good borrowers of the Bank.
  • Reduction of 1.5% interest or 10% rebate of chargeable interest for regularly repaying borrowers.
  • Reduction of rate of interest to attract prospective entrepreneurs.
  • Introduction of lending facilities to proprietorship and partnership concerns alongside traditional financing of private and public limited companies.
  • Reduction of time limit for processing of loan application from 90 to 60 days.
  • Special emphasis to promote agro-based small industries.
  • Sub-sectors selected by Bangladesh Bank under EEF (Equity & Entrepreneurship Fund) is encouraged for financing.
  • Joint venture projects based on technical collaboration and foreign equity participation is given special preference.

B. Government Policy, Especially, for Foreign Investment:

    B.1 Major Fiscal Incentives

  • Generous Tax Holiday up to 12 years;
  • Concessionary Tax for 5 years after completing initial 10 years;
  • Duty free import of capital machinery and raw materials for export oriented industry and concessionary import for domestic industry;
  • Avoidance of Double Taxation;
  • Tax exemption on royalties, technical know-how fees received by any foreign collaborator, firm, company and expert;
  • Exemption of income tax up to 3 years for the foreign technicians employed in industries specified in the relevant schedule of income tax ordinance;
  • 100% export-oriented industry outside EPZ will be allowed to sell 20% percent of their products in the domestic market on payment of applicable duties and taxes;

    B.2 Major Non-Fiscal Incentives

  • 100% foreign equity allowed;
  • Unrestricted exit policy;
  • Full repatriation facility of dividend, profit and invested capital;
  • Complete legal protection for invested capital;
  • Local and foreign borrowing allowed;
  • Fund raising from local capital market allowed;
  • Permanent residence permit and citizenship for foreign investors;
  • Multiple Entry Visa for foreign investors and employees;
  • One stop service for foreign investors by BOI/BEPZA;
  • Permanent residentship by investing a minimum of US$ 75,000 (non-repatriable);

C. Foreign investment is specially desired in the following categories:

  • Export-oriented industries;
  • To set up Industries in the Export Processing Zones (EPZs);
  • Basic industries based mainly on local raw materials;
  • Labor-intensive/technology-intensive/capital-intensive industries.
  • High technology export-oriented or import substitution products;
  • Quality enhancement, marketing and capacity building of existing industries;

D. Prospective Sectors for Foreign Investment in Bangladesh :

  • Textile (Ready Made Garments, Textiles, Composite Textiles).
  • Frozen Foods (Frozen Shrimp, Frozen Fish, Other Items).
  • Leather (Finished Leather, Leather Goods).
  • Electronics (Home Appliances, Telecommunication Equipment, Semi-Conductor).
  • Agro-based Industry (Fresh Fruits & Vegetables, Cooked/Semi Cooked Food Items,Canned Juice, Dairy and Poultry, Livestock and Fisheries).
  • Information Technology (Data Processing, Software Development, Hardware manufacturing.
  • Ceramic (Tableware, Sanitary ware, Insulator).
  • Light Engineering (Machinery Parts, Bi-cycle, Other Consumer Items).
  • Natural Gas-based Industries (Electricity, Fertilizer, Petrochemicals, CNG Distribution Network).
  • Telecommunication.
  • Export-oriented and Export-linkage Industries.
  • Steel Industry in Bangladesh.