China's Xinyi Glass Holdings Limited has recently proposed investing $200 million to set up a glass factory, for which the company has reached out to the Bangladesh Investment Development Authority (Bida), seeking land for establishing the factory through Foreign Direct Investment (FDI).
Two other Chinese companies – Kaixi Lingerie Bangladesh Corporation and SSH (BD) Sustainable Fashion Ltd – have proposed investments of $61 million and $24 million, respectively, to establish a high-end garments industry.
Among other recent Chinese investment interests, Sinovac Biotech has moved to establish a Plasma Centre in Bangladesh with an investment of $500 million. The company has already started the construction of its infrastructure.
According to Bida, at least 15 Chinese companies have brought direct investment in Bangladesh in the last year alone. Besides, another $1.5 billion worth FDI proposals came last year.
Bangladesh Bank data says the country's yearly growth of FDI from China stood at 13.5%. In 2015, FDI from China was only $56 million, which in seven years has increased 11.5 times.
"We are tirelessly working to bring in big investments from China and we are getting good responses," said Lokman Hossain Miah, executive chairman of Bida.
Bangladesh will see an increased investment in the textile and clothing sectors in the coming days as the business environment has marked tremendous improvement in recent years, said Calvin Ngan, president of the Overseas Chinese Association in Bangladesh (Ocab).
"In 2023, we see our motherland opening up the border and there will be no more quarantine. Flights between Bangladesh and China are increasing. Economic and cultural activities are beginning to pick up. We are seeing more Chinese coming to Bangladesh and more Bangladeshis going to China," he added.
Economists said the US-China trade conflicts are forcing Chinese manufacturers to relocate their production facilities to alternative locations and Bangladeshi zones will be able to attract those investors.
Dr Mohammad Abdur Razzaque, research director of the Policy Research Institute (PRI), said due to the elimination of our huge trade deficit with China and geopolitics, Bangladesh has got the attention of China's entrepreneurs. Moreover, during the latest visit of the Chinese president, they pledged to invest $27 billion in Bangladesh.
"It is possible to bring in more Chinese investment by presenting Bangladesh's potential," he added.
Govt making special economic zone for China
To give special benefits to Chinese investors, the government is making a special economic zone on about 783 acres of land in Anwara upazila of Chattogram.
When the project is completed, it is expected that employment opportunities will be created for approximately 2 lakh people.
Shaikh Yusuf Harun, executive chairman of the Bangladesh Economic Zones Authority (Beza), said many Chinese companies have already shown interest in investing here.
Al Mamun Mridha, acting secretary-general of the Bangladesh China Chamber of Commerce and Industry (BCCCI), also said they are trying to bring large investments to the Chinese Economic Zone.
Jinyuan chemical, Yabang Group, Techno and Miago are among the Chinese companies investing in the economic zones. In the Bay Economic Zone, MEIGO Bangladesh Ltd proposed a $50 million investment.
20-member Chinese delegation at Bangladesh Investment Summit
A delegation of 20 members including some members of the China Council for the Promotion of International Trade and various other business organisations are participating in the Bangladesh Business Summit to explore investment opportunities in Bangladesh.
The BCCCI said the delegation will meet with various authorities and business organisations including Bida, Beza as well as the commerce minister of Bangladesh,
Al Mamun Mridha, acting secretary-general of BCCCI, said they have a meeting with the visiting delegation on Sunday afternoon.
The delegation will discuss investments in high-tech industries, semiconductors, automobiles, agri machinery, cold storage chain, poultry and cow feed and technology transfer in Bangladesh.
"We will propose to them to import more sea fish, fruits, vegetables, jute and jute products from Bangladesh to the Chinese market," he said.
"We will also propose to set up a joint think tank with the participation of policy-makers as well as businessmen from both countries," added Mridha.
China a major partner in infrastructure and trade
China has huge investments in the infrastructure sector of the country. According to China Daily, China is implementing a $10 billion infrastructure project in Bangladesh.
The same trend is noticeable in trade. China is now Bangladesh's largest trading partner. The trade volume between the two countries is about $25 billion. Bangladesh mainly brings capital machinery, raw materials from China.
On the other hand, Bangladesh exports vegetables, frozen and live fish, leather and leather products, textile fibres, paper yarn and woven fabrics, garments and apparel items to the country.
China implemented duty-free facilities on 97% of Bangladeshi products from 1 July 2020. Later, it was increased to 98%. The export of crabs and eels to China resumed from last July. By exporting these two items, Bangladesh earns about $50 million a year from China.
Commerce Minister Tipu Munshi said, "China is Bangladesh's largest trading partner. Leather, ICT, and light engineering sectors can be potential investment sectors for the Chinese investors."