1. In which sectors private investment are restricted?

  Ans. As per industrial policy, following sectors are restricted for private investment i.e. only public sector investment are included in this reserve sector:

• Arms, ammunition and other defense equipment and machinery.
• Production of Nuclear energy.
• Forest plantation & mechanized extraction within the bounds of reserved forest.
• Security printing (currency notes) and minting.
•  

1. Under which law foreign investment in Bangladesh is protected?

Ans. Foreign investment is known as “The Foreign Private Investment (Promotion & Protection) Act 1980 (Act No. XI of 1980).

1. Could the foreign nationals living in Bangladesh transfer their Assets?

  Ans. Yes, foreign nationals living in Bangladesh permanently on expiry of employment may transfer their genuine savings arising from the emolument and retirement benefits such as provident fund, pensions and gratuity as per employment contracts approved by the BOI including sale proceeds of household articles, real estate etc. requires Bangladesh Bank’s special approval. 

1. Are the foreign nationals eligible to purchase Government securities?

Ans. Foreign nationals in Bangladesh may invest in Govt. Securities for income tax relief. Bangladesh Bank approval may be asked for through the bank. The bank will furnish a certificate to the following effect on the application form:

• The investment would be made out of the applicant’s genuine savings in Bangladesh.
• The applicant does not have local borrowings and overdraft.
• The proposed investment qualifies for tax relief against the investment allowance allowed by income tax authorities.

1. What are the terms under which a foreign company can avail loans and advances from Bangladesh?

  Ans. Foreign Exchange Regulation Act empowers the Bangladesh bank to regulate the ways the banks can grand loans and advances to any company. Thus Bangladesh Bank has given blanket permission to provide working capital loan to foreign owned/controlled industrial and trading firms/ companies under following terms:

• The company is deemed to be controlled directly or indirectly by persons resident outside Bangladesh.
• If it is a branch office of a company incorporated outside Bangladesh.
• In the case of a partnership firm, if 50% or more of the capital of the partnership is owned by foreign nationals or majority of the partners are foreign nationals
• In case of companies incorporated in Bangladesh, if:

• 50% of the shares or more are owned by foreign nationals or
• 50% or more of the directors in the Board of Directors of the company are foreign nationals. In the case of equal share holding or equal representation of the Board of Directors, a company is deemed to be foreign controlled if its Chairman is a foreign national.

1. What are the procedures to grant trading loans against overseas collateral?

  Ans. Prior granting of Taka loans to local as well as foreign controlled firm against overseas guarantee or collateral outside Bangladesh requires approval of Bangladesh Bank & the application should be made on ‘Form-L’. The applicant is required to state the purpose for which the credit facilities are required, the period of which the facilities would be needed, the value of stocks and assets in Bangladesh an reasons why borrowing against an overseas guarantee of collateral outside Bangladesh is necessary and the manner in which the proposed loan or overdraft is expected to be paid off.

1. What do you mean by NITA account? What are the significance of NITA account?

  Ans. NITA means Non Resident Investors Taka Account. Non residents persons/institutions including non resident Bangladesh nationals may buy Bangladeshi securities against foreign exchange remitted from abroad.   Significance of NITA account:   i). NITA account can be opened with any authorized dealer in Bangladesh.   ii). NITA can be opened in convertible foreign currency remitted from abroad through normal banking channel or by transfer of funds from the non resident investors foreign currency account, if any in Bangladesh.   iii). The account holder or his/her nominee can operate the account. The latter could be the bank with which the account is maintained.   iv). Balance in NITA may freely be used to buy Bangladeshi shares securities. v). The balances in this account are freely remittable abroad in foreign exchange.

1. Write down the names of investment promotion and facilitation bodies of the Government?

Ans.  

1. What was the objectives to establish BEPZA? When the first EPZ was established & where?

  Ans. BEPZA was established in 1980 to set up and operate export processing zones in Bangladesh with a view to providing a congenial/friendly investment climate free from procedural complications.   EPZ was first established in 1983 in Chittagong and second one in Dhaka in 1993.

1. What are the major incentives & facilities provided by BEPZA?

Ans. Following:  

1. Write short notes on Board of Investment (BOI)?

  Ans. The Government of Bangladesh established the Board of Investment (BOI) in 1989 to promote and facilitate investment in the private sector both from domestic & overseas resources with a view to contribute to the socio economic development of Bangladesh. The Board headed by the Prime Minister of the republic and represented by Ministers/Secretaries of the relevant ministries with Governor of Bangladesh Bank, President of FBCCI and BCI. measure   Functions  of BOI are broadly categorized into three:   i). Investment Promotion. i). Investment facilitation & iii). Policy advocacy.   Facilities & services available to the investors from BOI could be described in following stages:   a). Pre investment information & counseling. b). Physical verification c). Getting structured.

1. Write down the operational set up procedure of BOI?

  Ans. i). Registration with BOI.

ii). Self financed local investment proposals including industries sanctioned/financed by financial institutions or local bank.

iii). Permission for setting up joint venture industrial units with the public sector corporation.

iv). Obtaining Industrial plot.

v). Registration/Approval for foreign loan, suppliers credit etc.

vi). Obtaining utility connection.

vii). Import of spare parts and raw & packaging materials.

viii). Obtaining work permit for foreign nationals.

ix). Registration under factories act.

x). Registering under environmental; legislation.

xi). Remittance of royalty, technical know how and technical assistance fees.

1. Write down the potential sectors for investment?

  Ans.   i). Textile. ii). Frozen Food. iii). Leather iv). Electronics v). Agro based industries. vi). Information technology: Data processing, software development & hardware manufacturing. vii). Ceramic viii). Light engineering. ix). Natural Gas based industries. X). Steel

1. Write down the conditions to allow credit facilities to ‘A’ type EPZ units?

  Ans. i). The loan shall be received through an authorized dealers in foreign exchange in Bangladesh.  

ii). The loan will be credited to the units FC account maintained by the AD’s.  

iii). The loan amount may be used to finance import of capital machinery and raw materials, payment of interest/service charges, repayment of loan and for crediting Taka account for meeting local expenses.  

iv). Only assets fully owned by the Type A industry may be lodged as collateral for such loan.  

v). Repayment of principal and interest ion the loan shall be remitted from the balances available in the FC account . No fund may be provided from the Ad’s own sources for repayment of loans except with prior approval of Bangladesh Bank.  

vi). In case the loan is called up by the creditor the assets charged in favor of the foreign lender may be sold only in foreign currency loan is allowed to a type a industry.