An investor needs up to a year and a half to get approvals from 42 desks of different government offices for starting a business, which according to the businesses is depriving Bangladesh of the much-needed foreign direct and domestic investments.
The foreign direct investment (FDI) Bangladesh receives is insignificant compared to its peers and neighbours. Even Myanmar, with its troubled economy, received four times more than Bangladesh's around $2 billion in 2016-17 fiscal year. India got around $50 billion last year.
Even domestic investments, which had been hovering between 22 percent and 23 percent of the GDP for a decade, project a gloomy picture.
Understanding the issue, the government last year made a move to render faster services to investors and improve the country's abysmal ranking in “ease of doing business”, 177th among 190 economies.
A cabinet meeting chaired by the prime minister approved the One-stop Service Act 2017 on May 8 last year to provide investors 16 types of services faster and under one roof.
But it took the lawmakers 10 months to approve the proposed law, a move that contradicts the spirit of the act. Over three months have gone by since the parliament passed the law, yet investors know nothing about when they would get the faster services.
The Bangladesh Investment Development Authority (BIDA), which is one of the four secretariats that is supposed to provide one-stop services, is uncertain when they will be able to provide the services.
“I am hopeful that the one-stop service at the BIDA can be launched at the end of this year,” said Kazi M Aminul Islam, executive chairman of the BIDA. He said the good thing was that the rules and regulations for implementing the act had already been formulated.
He said they were supposed to provide the services from June this year, but it had been delayed due to the poor progress of other government agencies.
He said government offices, such as the Registrar of Joint Stock Companies and Firms, land registration, central bank, controller of export and import, the revenue board and the authorities of gas, electricity and water were not ready for the one-stop service centre integration.
Aminul said some 18 such government agencies and departments were in the process of joining the one-stop centre, but they need several other government offices to get connected to the BIDA.
Once the one-stop centre is operational, an investor may get approvals like registration of a company within one day and maximum 15 days. Similarly, connections to utilities will be given within a week. Only the approval for construction of a building may take 60 days.
“The one-stop service should start functioning immediately to attract investment and create jobs,” said MA Jabbar, managing director of the DBL Group, a leading garment exporter.
Jabbar said many countries, including China, were facing rising cost of doing business and they want to move their garment, pharmaceuticals, footwear, and food-processing factories to low-cost places, where Bangladesh ranks at the top.
“It is high time and there is no scope for delay in implementing the one-stop service centre,” he said.
BIDA needs the right leadership and right support staff for serving investors properly, Jabbar said.
“Improving the ease of doing business is urgent and the BIDA is the primary agency to lead the reforms,” said Asif Ibrahim, vice-chairman of Newage Group and former chairman of Dhaka Chamber of Commerce and Industry.
However, he said it would not be possible without the full support of the NBR, RJSC, CCI&E and the Bangladesh Bank.
“I hope that BIDA will get full inter-ministerial and departmental cooperation to make the reform successful,” he said.
Saiful Alam, president of the Leathergoods and Footwear Manufacturer and Exporter's Association of Bangladesh, said one-stop service centre should be empowered in the real sense so that the body could meet the requirements of the investors.
He went on to say that foreign investors would not come until and unless the one-stop service centre could work efficiently with full authority.
Paban Chowdhury, executive chairman of the Bangladesh Economic Zones Authority (BEZA), another government agency entitled to delivering the one-stop service, said they were currently providing nine types of services to its investors.
“We are hopeful of providing fully-fledged services by the year end,” said Paban.