Louisiana-based energy company Argent LNG announced on January 24 that it is building an LNG terminal in the United States with an annual capacity of 25 million tons. The company has signed a non-binding agreement with the Government of Bangladesh under which Bangladesh will be able to purchase up to 5 million tons of liquefied natural gas (LNG) each year. However, Argent LNG is a greenfield project, and there is little chance of gas being supplied before 2030. The agreement on behalf of Bangladesh was signed by Chowdhury Ashik Mahmud Bin Harun, executive chairman of the Bangladesh Investment Development Authority (BIDA). Questions were raised at the time over why the BIDA chairman had signed a gas-related deal.
After visiting the United States in January, the BIDA executive chairman traveled to Japan in February. The “Invest Bangladesh Road Show 2025” was held in Tokyo and Osaka, jointly organized by the Bangladesh embassy and BIDA. And in April, he joined the delegation of the Chief Adviser in Doha, Qatar, where he delivered a speech highlighting Bangladesh’s prospects in renewable energy and industrial development.
In July, Chowdhury Ashik led a high-level BIDA delegation to Shanghai, China. There, as the keynote speaker at the Bangladesh-China Investment Seminar 2025, he invited Chinese investors to invest in Bangladesh’s power, textile, and information technology sectors.
In August, Ashik Mahmud Bin Harun joined the Chief Adviser’s delegation to Kuala Lumpur, where he attended the Bangladesh-Malaysia Business Forum. There, he explained the special incentives available to Malaysian investors in Bangladesh’s special economic zones.
Most recently, on October 6, a high-level Bangladeshi delegation led by BIDA Executive Chairman Ashik Chowdhury — who also serves as executive chairman of the Bangladesh Economic Zones Authority (BEZA), and the Matarbari Integrated Development Authority (MIDA), as well as chief executive officer of the Public-Private Partnership Authority (PPPA) — arrived in Turkey for a six-day visit. In addition to attending seminars, he participated in several government-to-business (G2B) meetings during the trip.
Since his appointment more than a year ago, the BIDA executive chairman has conveyed Bangladesh’s investment potential through multiple international visits. According to officials from BIDA, BEZA, MIDA, and PPPA, his engaging presentations and discussions have highlighted new prospects in various sectors during each trip. They believe that, over time, these efforts will help Bangladesh attract substantial foreign direct investment (FDI).
However, investment officials caution that the scale of FDI inflow to Bangladesh will depend on long-term developments, a view reflected in official statistics.
According to the latest data from the Foreign Direct Investment and External Debt Management Cell (FIED) of Bangladesh Bank, net FDI inflows in the second quarter (April–June) of 2025 stood at $303.27 million. In the first quarter (January–March), the figure was $788.24 million. These figures represent a 61.53 percent decline in net FDI inflows in Q2 from the previous quarter. The central bank compiles FDI figures based on data related to capital (equity), reinvested earnings, and intra-company loans reported by foreign-investment firms operating in Bangladesh through the banking system. FDI inflows fell across all three of these categories.
On the other hand, a comparative analysis of FDI inflows between the second quarter of 2024 and the same period in 2025 shows an 11.41 percent increase in net FDI. The main driver of this growth was reinvestment by existing foreign investors, which surged by more than 595 percent in the April–June quarter of 2025 compared with the same period in 2024. During the same time, capital or equity investment fell by 62.03 percent, indicating a decline in new capital inflows.
Responding to Bonik Barta’s query regarding the 61.53 percent drop in FDI between the first and second quarters of 2025, BIDA spokesperson and Head of Business Development Nahian Rahman Rochi said, “In the second quarter of 2025, there was a sense of uncertainty in the global economy and trade environment. The U.S.-China trade tensions, disruptions in shipping through the Red Sea and Panama Canal, and changes in export subsidies and tariff policies in several countries have caused turmoil in global supply chains. As a result, many multinational companies have postponed or reassessed new investment plans both domestically and globally. This led to a temporary slowdown in emerging economies, particularly in greenfield equity investments.”
Addressing seasonal effects, Rochi added, “Sometimes, large one-time inflows of equity or loans for specific projects occur in the first quarter, making the following quarter appear weaker by comparison. So the decline in the second quarter is a normal seasonality impact. It is worth noting that in April–June 2024, total investment also fell by about 35 percent due to this same seasonality effect.”
He further claimed that the decline in Q2 of 2025 is not comparable, as investment had nearly doubled in Q1 of the year.
Highlighting the more than 11 percent year-on-year increase in total investment in the April–June quarter, the BIDA spokesperson said, “The main driving force behind this growth is reinvested earnings. Those already operating in Bangladesh have reinvested their profits here instead of repatriating them. This shows that existing investors are confident in Bangladesh’s business environment and are eager to expand their operations. The 62.03 percent drop in equity FDI is due to global challenges. Considering these challenges and to improve the domestic investment climate, BIDA is working on 32 priority reforms. These include addressing regulatory complexities, reducing paperwork delays, and resolving issues related to foreign exchange and profit repatriation.”
Analysts believe that political uncertainty, a shortage of foreign currency, and challenges in the power and energy sectors have made foreign investors more cautious, which has affected FDI inflows in Q2 of 2025. They said the rise in reinvested earnings in the April–June quarter this year, compared with the same period last year, was primarily because the dollar shortage remained severe until the September quarter of 2024, but the situation gradually improved afterward. Even so, many multinational companies (MNCs) may have spent part of their profits on operational expenses instead of repatriating them. Rising business costs and higher interest rates may also have led companies to use their profits as working capital rather than borrowing from banks. For these reasons, experts believe, reinvested earnings appear higher in 2025 FDI data compared with 2024.
Tareq Rafi Bhuiyan (Jun), president of the Japan-Bangladesh Chamber of Commerce and Industry (JBCCI), told Bonik Barta, “We believe Japanese and other foreign investors are still interested in Bangladesh. They are in a ‘wait-and-see’ mode. Once a stable government is in place, they will invest more. The companies currently investing, such as the Chinese firms for example, may be doing so because of tariffs and other advantages. But those who can wait will wait for the election. And I think that’s reflected in the data. I recently visited Japan with a delegation, and we held major seminars in Tokyo and Osaka attended by more than 100 investors in each city. We saw considerable interest among them. The truth is, investors, regardless of nationality, want policy stability. Since the current government is an interim one, investors are continuing feasibility studies. But they want stability before investing.”
Malaysian investors were reached out for comment. Speaking on condition of anonymity, they said they were assessing whether their investments in Bangladesh are secure and whether returns are guaranteed. Some firms faced major obstacles even before 2024 in implementing their planned large-scale investments. At one stage, some had even signaled to the previous government that they might withdraw investments. They said many of those obstacles—such as tax policies, regulatory controls, and overall business environment issues—remain unresolved in some areas and have been largely overlooked.
Shabbir A Khan, president of the Bangladesh-Malaysia Chamber of Commerce and Industry (BMCCI), told Bonik Barta, “Malaysia is one of the largest investors in Bangladesh. Robi and Edotco are the major investors. Both companies have kept funds ready for investment since 2024. But given the current situation, they are waiting to observe the investment climate. When the chief adviser visited Malaysia, there were discussions with the country’s biggest investors. However, no visible investment movement has taken place yet. I think they are still waiting, and that’s the main reason—they’re waiting for a more favorable investment environment.”
Experts say Bangladesh must undertake deep reforms to make its investment environment more attractive and boost foreign direct investment (FDI). First, the country must make the Special Economic Zones (SEZs) fully operational so investors can access promised facilities and infrastructure. Second, trade policy liberalization is needed—particularly simplifying tariffs, barriers, and approval processes in import and export operations. Third, excessive government control must be reduced to establish a more competitive market system. They also stressed the need for transparency in the tax structure, faster enforcement of contracts, and consistency in policy. Improving infrastructure, strengthening the skilled workforce, and expanding technological cooperation could help transform Bangladesh into a more investor-friendly destination, thereby revitalizing FDI inflows.
Selim Raihan, executive director of the South Asian Network on Economic Modeling (SANEM), told Bonik Barta, “In the second quarter (April–June) of the current fiscal year, FDI fell by 61.53 percent compared to the first quarter. This is a serious warning that could negatively affect the investment climate and the overall macroeconomy. Over time, such a decline hampers economic growth, job creation, and technology transfer. It clearly shows that foreign investors are either reluctant or uncertain about making new investments in Bangladesh. Although total FDI rose 11.41 percent compared to the same period last fiscal year, the main driver of that growth was reinvested earnings.”
Highlighting that new equity investment fell 62.03 percent, Raihan said, “This indicates that while existing investors still have partial confidence, Bangladesh is failing to attract new ones. To overcome this situation, both policy and structural reforms are essential. Many procedures here remain complex, time-consuming, and inefficient, which discourages foreign investors.”
It is not just foreign investors who are cautious. Local entrepreneurs, too, are avoiding major investments due to political uncertainty, weak law and order situation, extortion, and bureaucratic bottlenecks. Many say that while they are not expecting all problems to be solved immediately, they are waiting for the upcoming election before making major decisions. With nearly four months to go until the polls, as announced by the Interim Government, industry insiders see little chance of a revival in investment activity before then.
Zaved Akhtar, president of the Foreign Investors’ Chamber of Commerce & Industry (FICCI), told Bonik Barta, “The Bangladesh Bank’s recent report on declining FDI has deeply concerned us all. It’s a challenging signal for the dynamism of our economy and its future prospects. We believe greater policy transparency, a better business environment, political stability, and stronger infrastructure can reverse this trend. FICCI Bangladesh is ready to work closely with the government to help achieve these goals and make the country a more attractive destination for foreign investment.”