Swedish IT firms interested in Bangladesh

Some of the top Swedish IT firms that have operations in the Indian city of Bangalore are interested in relocating to Bangladesh for lower costs of production, Commerce Minister Tofail Ahmed said yesterday.

To explore the relocation prospects, a delegation comprising top businessmen from Sweden is due in the country on March 11, the minister told reporters after a meeting with Swedish Ambassador in Dhaka, Johan Frisell, at the secretariat.

Bangladesh is a good destination for investment for its good and continued economic growth, long-time macroeconomic stability and for good environment, Frisell said.

However, the country needs to address issues like transportation and logistics services.

He also said the country should find new products to export to Sweden other than garment.

In response, Ahmed said that IT is one of the most promising sectors for Bangladesh.

The government has already marked it down along with pharmaceuticals, leather, shipbuilding, and furniture as thrust sectors that can go on to reduce the current overwhelming export dependency on the garment sector, he added.

At present, the garment sector contributes more than 80 percent to the total export earnings.

Regarding the current political impasse and trade scenario, the minister said the whole supply chain is running as normal, with no disruptions in transportation of goods from factories to port and vice versa. “People are facing traffic jams on the roads.”

The minister, however, said the situation has already improved a lot and will improve further in the coming days.

He also acknowledged that transport fare for carrying goods from factories to port and vice versa have increased for the blockade and shutdowns, ongoing since January 6.

Describing the relationship between Bangladesh and Sweden as warm and healthy, Frisell said Bangladesh is fast approaching the middle-income status, which is good news for all.

At present, the bilateral trade balance is heavily tilted in Bangladesh's side, mainly for higher export volumes of apparel items to Sweden.

In fiscal 2013-14, the country exported goods worth $421.74 million to Sweden, up 4.39 percent year-on-year. It imported goods worth $69.40 million, which is an increase of 13.4 percent from the previous year.

Apart from apparel items, Bangladesh exports footwear, home textile, ceramic table wares, terry towel, handicrafts, wooden furniture, jute and jute yarn, leather, tents and shrimps to the Scandinavian nation.

On the other hand, it imports machinery and machinery appliances, electrical equipment, vehicles, aircrafts, vessels and associated transport equipment from Sweden.

Bangladesh enjoys zero-duty benefit on export to Sweden under the European Union's Everything But Arms scheme.