The key challenge for the country in 2016-17 fiscal year is to address the rate of private investment to GDP ratio as it can affect the 7 per cent projected growth in coming year, said the International Chamber of Commerce, Bangladesh in its quarterly economic update on Thursday.
It said that private investment has remained virtually stagnant at 22 per cent of GDP, with foreign direct investment (FDI) accounting for about 1 per cent of GDP.
The government has given top priority to ten fast-track mega projects in the current FY budget and given Tk 187.27 billion fund allocations for eight out of total 10 fast-track mega projects, it said.
The mega projects are the Padma bridge, Padma bridge rail connection, Metro rail, Sonadia Deep Sea Port, Rooppur nuclear power plant, Payra sea port, Rampal Thermal power plant, Matarbari power plant, LNG terminal, and Dohazari-Cox’s Bazar-Gundum rail line.
‘During three months of current fiscal year many of the fast-track projects attracted foreign investment,’ it said.
The ICCB report showed that to achieve its goal of middle-income country status by 2021, the country will require a substantial increase in yearly investments from 29.0 per cent of GDP in FY2015 to 34.4 per cent of GDP by FY2020.
‘More than US$ 11 billion in external resources will be needed for public sector investments,’ it said.
In order to attract FDIs, the government agencies have to be more vibrant and proactive, it said.
It also said that the recent merger of Board of Investment and Privatisation Commission into one body – Bangladesh Investment Development Authority—will hopefully be able to meet long demanded ‘ONE STOP’ service for foreign investors.
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