Country profile

Bangladesh

A Global Manufacturing Platform, a Major Labour Migration Market and a Developing Digital Economy

Bangladesh is one of the most significant economies in South Asia, combining a large consumer market, a young population, a developed export manufacturing sector and considerable potential for further industrialisation. The country holds a leading position in global ready-made garment exports, is developing digital financial services and is gradually expanding its infrastructure to attract international capital.

In recent years, Bangladesh has faced economic and political challenges. However, implementing reforms, restoring investment activity and developing new manufacturing sectors remain important government priorities. For international investors, opportunities may exist in the textile industry, FinTech, agro-processing, logistics, energy and services for migrant workers.

01Economic Scale and Financial Flows

  • Nominal GDP: approximately USD 506.4 billion, according to the IMF's 2026 estimate.
  • Economic growth: IMF forecast of 3.6% in 2026; World Bank forecast of 3.4% in FY 2025/26.
  • Population: approximately 175.4 million, according to the IMF's 2026 estimate.
  • Merchandise exports: USD 48 billion in FY 2025/26.
  • Ready-made garment exports: approximately USD 38.7 billion in FY 2025/26.
  • Migrant remittances: a record USD 35.6 billion in FY 2025/26.
  • Foreign direct investment: net inflows of approximately USD 1.77 billion in 2025.

Bangladesh has a large domestic market and substantial labour resources. Its export economy is primarily based on ready-made garments and textiles, agricultural products, leather goods, pharmaceuticals and selected categories of manufactured goods.

However, economic momentum has slowed in recent years. The World Bank notes that energy constraints, weaknesses in the banking sector, high inflation and insufficient domestic revenue mobilisation are weighing on investment and economic activity.

02Geoeconomic Position

Bangladesh is located in South Asia on the coast of the Bay of Bengal, between India and Myanmar. Its geographical position provides access to maritime trade routes across the Indian Ocean and creates opportunities for international trade with countries in South and Southeast Asia.

The country participates in the South Asian Free Trade Area (SAFTA), the BIMSTEC initiative and other regional cooperation frameworks. These arrangements provide a foundation for developing trade relations with India, Nepal, Bhutan, Sri Lanka, Thailand and other regional markets.

Access to the Bay of Bengal and the presence of major seaports in Chattogram and Mongla are particularly important. Port infrastructure development, including the Bay Terminal project, is expected to increase the capacity of the country's foreign trade routes.

Another important factor is Bangladesh's participation in international trade preference schemes for least developed countries (LDCs). The country's graduation from this category was originally scheduled for 2026. However, a decision by the United Nations General Assembly extended the preparatory period until 24 November 2029.

This provides additional time for the country's export industries to prepare for changes in access conditions to certain international markets.

03Key Growth Drivers

01

Young Population and Large Domestic Market

Bangladesh has one of the largest and most densely populated consumer markets in South Asia. According to the IMF, the country's population is approximately 175.4 million in 2026.

Its demographic structure remains relatively young, with a substantial proportion of children, young people and working-age residents. This creates potential demand for education, housing, food, healthcare, transport, financial products and consumer goods.

At the same time, a large number of young workers enter the labour market every year, creating opportunities for manufacturing businesses and service companies.

Investment opportunities: consumer goods manufacturing, retail, e-commerce, healthcare, education, residential construction, consumer lending and digital services.

Why does this matter? The scale of the population provides the potential for substantial domestic demand. However, purchasing power and income levels vary significantly between social groups and regions, so projects need to take their target audiences into account.

02

Global Manufacturing Platform and Textile Industry

Bangladesh is one of the world's leading ready-made garment exporters and an important manufacturing centre for the international fashion industry.

According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), ready-made garment exports amounted to approximately USD 38.7 billion in FY 2025/26. This product category accounted for approximately 80.6% of the country's total merchandise exports.

The manufacturing ecosystem includes international brands, local factories, fabric suppliers, manufacturers of accessories and packaging, and logistics operators. Sustainable manufacturing is becoming increasingly important: the country has more than 230 light-industry facilities certified under LEED standards.

The next stage of the sector's development involves moving beyond basic clothing towards technical textiles, higher value-added products and more sophisticated manufacturing processes.

Investment opportunities: garment and textile factories, fabric and materials production, dyes and accessories, textile waste recycling, technical textiles, industrial equipment, factory automation and environmental technologies.

Why does this matter? Established manufacturing infrastructure, international supply experience and access to a skilled workforce allow Bangladesh to be considered a destination for export-oriented manufacturing.

03

FinTech and Digital Economy

Bangladesh is gradually expanding the use of digital financial services, mobile payments and electronic platforms. One of the best-known examples is bKash, a major mobile financial services company.

According to DataReportal, Bangladesh had approximately 82.8 million internet users at the end of 2025, equivalent to around 47% of the population. This indicates that the digital market has already reached considerable scale, while significant potential remains for expanding internet access.

According to Bangladesh Bank, by 2025 the Mobile Financial Services (MFS) ecosystem included approximately 250 million registered accounts and more than 2 million agents. However, the number of accounts should not be equated directly with the number of unique users: one person may hold several accounts or use services from different providers.

Other recognised technology companies and platforms include Pathao and ShopUp, which develop solutions for transport, e-commerce, trade and logistics.

Investment opportunities: mobile payments, digital banking services, e-commerce, lending platforms, InsurTech, business software, digital logistics, cybersecurity and SaaS services.

Why does this matter? The scale of the population and the development of mobile financial infrastructure are generating demand for digital products. At the same time, the relatively low share of internet users compared with the total population indicates considerable scope for further expansion of digital services.

04

Labour Migration, Diaspora and Remittances

International labour migration is highly important to Bangladesh's economy. Citizens of the country work in the Gulf states, Malaysia, Singapore, the United Kingdom, Italy and other countries, generating one of the largest remittance flows in South Asia.

According to Bangladesh Bank, remittances from migrant workers reached a record USD 35.6 billion in FY 2025/26, an increase of 17.3% compared with the previous financial year.

These funds make a significant contribution to household welfare, domestic consumption and foreign currency earnings. At the same time, expanding migration flows create demand for financial and service products connecting workers abroad with their families and businesses at home.

Investment opportunities: international remittances, digital payment platforms, overseas employment support services, recruitment, migration consulting, insurance, educational and pre-departure training, and services for migrants' families.

Why does this matter? Significant and recurring remittance flows generate demand for accessible financial services, cross-border payments and personal financial management solutions. Such projects must also comply with anti-money laundering requirements, licensing rules and customer protection standards.

05

Agro-Industrial Complex and Food Processing

Agriculture remains an important part of Bangladesh's economy. The country produces rice, jute, tea, sugarcane, potatoes, vegetables, fruit, fish and other agricultural products.

High population density and limited land resources make improving agricultural productivity one of the priorities of economic policy.

Significant opportunities exist in food processing, storage, packaging and cold-chain development. Technologies that reduce post-harvest losses and improve farmers' access to markets are particularly important.

Investment opportunities: agricultural processing, rice and fish industries, food storage and packaging, cold storage facilities, greenhouses, irrigation systems, agricultural technology and fertiliser manufacturing.

Why does this matter? Developing agro-industrial processing can increase the added value of agricultural products, improve food security and create additional export opportunities.

06

Government Support, EPZs and Investment Incentives

Bangladesh uses Export Processing Zones (EPZs) and Economic Zones (EZs) to attract international companies and expand industrial production.

The Bangladesh Export Processing Zones Authority (BEPZA) offers registered participants special business conditions. Depending on the company's category and the applicable rules, incentives may include tax holidays of 5–10 years, exemptions from certain duties on imported machinery and raw materials, and the possibility of full foreign ownership.

Where permitted by law, the repatriation of capital, profits and dividends is also allowed. However, the relevant banking, foreign exchange and registration procedures must be followed.

The Bangladesh Investment Development Authority (BIDA) provides additional administrative support. Through its One Stop Service system, foreign and domestic investors can access certain registration, licensing and other government services. According to published BIDA data, the system brings together 58 electronic services from various government agencies and organisations.

Investment opportunities: export-oriented manufacturing facilities, textile complexes, pharmaceuticals, electronics, food processing, logistics centres, assembly operations and industrial infrastructure.

Why does this matter? Special economic zones allow investors to use tax and customs incentives provided by law, while the One Stop Service system helps coordinate administrative procedures. However, incentives are not automatic and depend on the licence, location and type of business activity.

07

Logistics, Seaports and Regional Trade

Access to the Bay of Bengal gives Bangladesh the opportunity to participate in trade flows between South and Southeast Asia. The Port of Chattogram handles the largest share of the country's international cargo traffic.

The Bay Terminal project near Chattogram is being implemented to increase transport infrastructure capacity. In June 2024, the World Bank approved USD 650 million in financing to support maritime infrastructure development, including construction of a six-kilometre breakwater and improvements to access channels.

The development of the terminal is expected to improve container handling efficiency, reduce vessel turnaround times and lower logistics costs.

Investment opportunities: port infrastructure, warehouses, container terminals, freight transport, multimodal logistics, customs support, digital supply chain management systems and services for export businesses.

Why does this matter? Modernising ports and transport corridors can increase the competitiveness of export manufacturers and strengthen Bangladesh's role in regional trade.

08

Renewable Energy and Sustainable Manufacturing

Bangladesh faces growing demand for electricity, particularly from manufacturing companies and urban populations. Dependence on conventional fuels, limitations in energy infrastructure and supply reliability issues are creating a need to diversify the energy mix.

Under the Renewable Energy Policy 2025, the country set a target of meeting 20% of its electricity demand from renewable sources by 2030 and 30% by 2040. In June 2026, installed renewable energy capacity was estimated at approximately 1.78 GW.

Additional opportunities are emerging due to growing environmental requirements imposed by international manufacturers and buyers on exported products. This is particularly relevant to the textile industry, where energy efficiency, water resource management and emissions reduction play an important role.

Investment opportunities: solar power, rooftop solar systems for factories, energy storage systems, energy-efficient equipment, electricity grid modernisation, industrial wastewater treatment and waste recycling projects.

Why does this matter? Energy constraints are creating demand for alternative electricity sources and improved industrial efficiency. However, project implementation depends on grid connection conditions, tariff regulation and the financial sustainability of electricity buyers.

04Taxation and the Investment Environment

Bangladesh generally allows significant foreign capital participation in its economy. In most industries, companies can be established with 100% foreign ownership, although restrictions and local participation requirements remain in certain business categories.

Key tax reference points for the 2026/27 assessment year
  • Corporate income tax: 27.5% for most unlisted companies; a rate of 22.5% applies to certain listed companies, subject to the relevant conditions.
  • VAT: standard rate of 15%; exports are zero-rated, while special rules may apply to certain categories of goods and services.
  • EPZs: depending on the company's category and the applicable incentive period, tax holidays of 5–10 years may be available.
  • Foreign ownership: 100% foreign participation is permitted in most sectors, although certain services and regulated activities are subject to restrictions.

Foreign investors also have mechanisms available for repatriating capital, profits and dividends. Their use depends on the origin of capital, investment registration, Bangladesh Bank requirements and compliance with foreign exchange regulations.

05Investment Rationale

Bangladesh is of interest as a manufacturing and consumer market with a large population, a developed export-oriented textile industry and growing demand for digital financial services.

The most notable areas to explore include ready-made garments and technical textiles, FinTech, migration and payment services, food processing, port logistics, renewable energy and industrial infrastructure.

Particular attention should be paid to export-oriented projects, as they can benefit from established production chains and access to foreign markets. At the same time, investors should assess cost structures, the condition of the banking infrastructure, foreign currency liquidity, energy availability and potential changes to trade preferences after 2029.

Conclusion

Bangladesh has significant long-term potential thanks to its large population, one of the world's major ready-made garment industries, substantial remittance flows from migrant workers and the expansion of digital financial services.

The country is gradually diversifying its economy and developing infrastructure for international business. For investors, it may offer opportunities in export manufacturing, FinTech, agro-processing, logistics and energy projects.

At the same time, Bangladesh is undergoing institutional and economic reforms, while current constraints in the banking sector, energy supply and foreign trade require thorough assessment of every project and its financial model.

If you are interested in projects from this country, send us a private message — we will be happy to help you identify suitable opportunities.

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Sources and information base
  1. International Monetary Fund (IMF) — World Economic Outlook, October 2026: GDP forecasts, economic growth, inflation and population estimates for Bangladesh
    https://www.imf.org/external/datamapper/profile/BGD
  2. World Bank — Bangladesh Development Update, October 2026: economic growth forecasts, banking sector challenges, energy, investment and domestic revenue mobilisation
    https://www.worldbank.org/en/news/press-release/2026/10/06/bangladesh-needs-urgent-financial-energy-and-revenue-reforms-to-restore-growth-cre
  3. United Nations — Bangladesh's graduation status from the Least Developed Country category and the extension of its preparatory period until 24 November 2029
    https://www.un.org/ldcportal/en/content/bangladesh-graduation-status
  4. Bangladesh Bank — annual data on workers' remittances and the amount received in FY 2025/26
    https://www.bb.org.bd/en/index.php/econdata/bop_yearly/5
  5. Bangladesh Garment Manufacturers and Exporters Association (BGMEA) — ready-made garment exports and total merchandise exports in FY 2025/26
    https://www.bgmea.com.bd/page/Export_Performance
  6. Invest Bangladesh / Bangladesh Investment Development Authority — sector overview of the textile and garment industry, export indicators and environmental standards in factories
    https://investbangladesh.gov.bd/investment-sector/textiles-apparels
  7. Bangladesh Bank — Annual Report 2024–2025, development of FinTech and mobile financial services
    https://www.bb.org.bd/pub/annual/anreport/ar2024-2025.pdf
  8. DataReportal — Digital 2026: Bangladesh: number of internet users, internet penetration and the demographic structure of the digital audience
    https://datareportal.com/reports/digital-2026-bangladesh
  9. Bangladesh Investment Development Authority (BIDA) — net foreign direct investment inflows in 2025 and their composition
    https://investbangladesh.gov.bd/press-release/bangladesh-net-fdi-inflows-rise-39-36-in-2025
  10. Bangladesh Export Processing Zones Authority (BEPZA) — tax holidays, customs incentives, foreign ownership and repatriation of capital and profits
    https://www.bepza.gov.bd/public/pages/incentives-facilities
  11. Bangladesh Investment Development Authority (BIDA) — One Stop Service, electronic services for foreign investors and project registration procedures
    https://irms.bida.gov.bd/header/bida_oss
  12. Bangladesh Bank — conditions for foreign direct investment, foreign ownership and capital repatriation
    https://www.bb.org.bd/en/index.php/Investfacility/invesfac
  13. National Board of Revenue (NBR) — corporate tax rates for assessment years 2026/27 and 2027/28
    https://nbr.gov.bd/uploads/budget/English.pdf
  14. National Board of Revenue (NBR) — standard VAT rate and tax rules for imports and exports
    https://nbr.gov.bd/faq/vat-faq/eng/contents/e-services/vatcalculator/eng
  15. Ministry of Energy of Bangladesh — Renewable Energy Policy 2025 and government targets for increasing the share of renewable energy
    https://objectstorage.ap-dcc-gazipur-1.oraclecloud15.com/n/axvjbnqprylg/b/V2Ministry/o/office-powercell/2024/12/e090083ecd2142208d945bcb086334e0.pdf
  16. Invest Bangladesh — sector overview of renewable energy, current capacity and development targets
    https://investbangladesh.gov.bd/investment-sector/renewable-energy
  17. World Bank — infrastructure financing and the Bay Terminal project; approval of USD 650 million for maritime infrastructure development
    https://www.worldbank.org/en/news/press-release/2024/06/28/world-bank-helps-bangladesh-develop-bay-terminal
  18. Government of the United Kingdom (GOV.UK) — overview of Bangladesh's political situation in October 2026, election results and transition to the new government
    https://www.gov.uk/government/publications/bangladesh-country-policy-and-information-notes/country-policy-and-information-note-political-situation-bangladesh-october-2026-accessible
  19. Bangladesh Bank — monthly trends in remittance inflows for FY 2025/26 and FY 2026/27
    https://www.bb.org.bd/en/index.php/econdata/wageremitance
This material has been prepared exclusively for informational purposes on the basis of publicly available sources and constitutes a general overview of the relevant country's market. The information presented does not constitute an investment recommendation, analytical assessment, financial, legal or other professional advice, nor does it constitute a solicitation or invitation to invest, conduct business activities or establish business relationships in the country concerned. Any decisions made on the basis of this information should be based on an independent assessment and additional professional advice.
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