Export Processing Zones of Bangladesh are generally acknowledged to be successful in attracting Foreign Direct Investment (FDI) thus contributing significantly to the overall economic development of the country. At the same time, they are playing a catalytic role in facilitating the transfer of technology and development of forward and backward linkage industries in Bangladesh. "The mission of BEPZA is to facilitate the economic development of our country through promotion of foreign and     local investment and certainly creation of employment," says Brigadier    General Jamil Ahmed Khan, ndc, psc; Executive Chairman, BEPZA  (Bangladesh Export Processing Zones     Authority).  
Pointing out that the primary objective of an EPZ is to provide special areas where potential investors would find a congenial investment climate, free from cumbersome procedures, he claims, "EPZs have been promoting FDI & local investment, diversification of export, development of backward & forward linkages, generation of employment, transfer of technology, upgradation of skill  and development of management."

Currently there are 8 EPZs in Bangladesh: EPZ-Chittagong, EPZ-Dhaka, EPZ-Mongla, EPZ-Ishwardi, EPZ-Comilla, EPZ-Uttara, EPZ-Adamjee and EPZ-Karnaphuli. In the context of growing demand from prospective investors, Board of Governors of BEPZA has formally approved two new EPZs: EPZ Meghna and EPZ Feni. Meghna EPZ, having the advantage of its excellent location (it is near   Dhaka-Chittagong National Highway, in close proximity to the capital city Dhaka (34km) and adjacent to an already growing industrial cluster) has great potential for flourishing. The project is expected to accommodate 130 Units with an estimated investment of $1625 million and employ fifty thousand people. The competitive advantage of Feni EPZ comes from its easy accessibility to Chittagong Port. The zone is only 120km away from the port, which will accelerate the export and import activities of this zone. An area of about 500 acres of land has been earmarked for the project which is expected to generate employment for more than 80,000 people. BEPZA has a vision of creating new zones to keep pace with the present day need of the investor and customizing the concept in the context of Bangladesh. The Government of Bangladesh has also taken an initiative to extend the area of EPZ-Comilla in near future. 

The cumulative 'Lease Signed Investment' 1 in December 2008 in EPZs was 3618 million US$, which increased 10% to 3983 million US$ in November 2009. On the other hand the cumulative actual investment in December 2008 was 1509 million US$, which increased 11% to 1673 million US$ in November 2009. The total number of local employees in December 2008 was 228,932, which increased 4% to 236,511 in November 2009. Among these employees 64% are female. The export figure of the EPZs is also notable. The cumulative export from the EPZ area in December 2008 was 17.21 billion US$, which increased 16% to 19.98 billion US$ in 2009. The export projection in this fiscal year is 2.8 billion US$. The authority is confident about achieving this target.

Jamil provides some other important facts. Approximately a little more than 300 industries are in production right at this moment. Other than the employees a huge number of people are dependent on the activities of EPZs.  Around 500,000 people are involved with the EPZs through the transport sector, food sector, housing sector, subcontracting and so on. So, about 2,400,000 people are earning their livelihood through EPZs. "Last fiscal year the total export amount from the EPZs was 2.4 billion US$, and we were able to retain 1.1 billion US$ in our country out of this 204 billion US$ through the salaries and wages of labor, other businesses operating inside EPZ areas, transportation, C&F, port charge, utility charge, and subcontracting to other local companies."

BEPZA provides a number of Fiscal Incentives for the investors such as 10 years' tax holiday, duty free import of construction materials, duty free import of machineries, office equipment & spare parts etc., duty free import and export of raw materials and finished goods, relief from double taxation, exemption from dividend tax, GSP facilities, accelerated depreciation on machineries or plants, remittance of royalty, technical and consultancy fees, duty & quota free access to EU, Canada, Norway, Australia etc.

There are Non-Fiscal Incentives as well such as 100% foreign ownership, entitlement to MFN (Most Favored Nation) status, no ceiling on foreign and local investment and full repatriation of capital & dividend. Also, foreign currency loan from abroad under direct automatic route, Non-resident Foreign Currency Deposit (NFCD) account and operation of FC account by 'B' and 'C' type Industries are allowed.

Other facilities include: no UD, IRC, ERC and renewal of Bond license; work permits issued by BEPZA; secured and protected bonded area; off-shore banking available; import on Documentary Acceptance (DA) basic allowed; bank of back L/C; import and export on CM basis allowed ; import from DTA (Domestic Tariff Area); 10% sale to DTA (Domestic Tariff Area); customs clearance at factory site; simplified sanction procedure; sub-contracting with export oriented Industries inside and outside EPZ allowed; relocation of foreign industries allowed; Resident status and Citizenship accorded and One Window same day service and simplified procedure.

The Brigadier General is hopeful that the EPZ areas will be self-sufficient in power supply within a short time under the concept of 'Public Private Partnership' (PPP) whereby government will provide land and the private entrepreneurs will come up with the capital to generate power.

The Executive Chairman points out EPZ-Chittagong, EPZ-Dhaka and EPZ-Karnaphuli are the prime areas of attraction for foreign investors in Bangladesh because of various location related advantages. Unfortunately, there are no plots vacant in these EPZs.

Another problem is the gas situation. Every 9 out of 10 investments require gas supply but the authorities are unable to provide any extra gas supply for new factories.

At the moment 212 industries are under implementation. These industries may start their operation within the next 6 (six) months. In keeping with the trend in global business and investment Bangladesh's EPZs have revised their expansion strategy; the investment incentives and facilities are being made more market oriented and flexible. New zones in strategic locations with state-of-the-art industrial facilities and pro-investment institutional framework are providing the right kind of enabling environment for businesses to grow.