If the private sector needs to play the desired key role in elevating the country to an upper middle-income country, it needs to be freed from the hassles of bureaucratic red-tape, speakers at a discussion said on Wednesday.
It would also need infrastructure and policy support and to be shielded from corruption, they said at a session of the Bangladesh Development Forum that kicked off in the city on Wednesday.
Such measures are important because it is the private entrepreneurs who would generate 2.2 million jobs every year, they said.
For this, they need a proper business environment and trade policy, they added.
Dr Md Zafar Uddin, secretary of the Ministry of Commerce, presented the keynote paper titled "Private Sector Engagement and Trade Facilitation" while Sheikh Fazle Fahim, president of the Federation of Bangladesh Chambers of Commerce and Industries (FBCCI), presided over the session.
Dr Zafar said there is a lack of coordination among ministries and divisions in facilitating the private sector.
He said Bangladesh will graduate from a least developed country (LDC) by 2024 and receive all LDC support until 2027.
"To meet further challenges, the government is seeking opportunities to sign preferential trade agreements and free trade agreements in order to boost regional trade. Bangladesh is also trying to improve bilateral relations with other countries.
"The government plans to diversify products and market to meet the challenges that will arise after 2027. Footwear, leather and leather products, plastic, light engineering, jute and agriculture-based products could boost export earnings," said Dr Zafar.
He also said to meet future challenges, Bangladesh needs to push private investments significantly, which was 23.10 percent of the GDP in the fiscal year 2017-18.
"Foreign direct investment in the country is only $3.6 billion, which is substantially lower than that in Vietnam ($15.5 billion) and the Philippines ($6.4 billion).
"Bangladesh lags behind competing countries in overall competitiveness, securing 103th position among 140 nations," said Dr Zafar.
He identified the lack of infrastructure as a major obstacle to industrialisation and said, "The global infrastructure outlook estimates an investment need of $608 billion in infrastructure in Bangladesh until 2040. This translates into an average investment requirement of $24.3 billion in infrastructure annually since 2015."
The keynote speaker also said almost 35 percent of the products were damaged during cargo and container handling at the country's key ports.
"Delay in shipment by a day may lead to reduction in overall trade by one percent."
As a panelist of the session, Md Sirazul Islam, executive chairman of the Bangladesh Investment Development Authority, said despite being among the top 20 improvers and advancing eight notches on the World Bank's Doing Business index, Bangladesh is still far behind many countries.
"Bangladesh ranks 176th in the trading across borders indicator. Our organisation coordinates with several ministries, such as the commerce ministry, law ministry, local government division and planning ministry, and the private sector too," he added.
At the programme, Rubana Huq, president of the Bangladesh Garment Manufacturers and Exporters Association, raised questions about the government's preparation for meeting the challenges that will arise after graduating from the LDC status.
"What would be the export situation after we graduate?" she questioned.
Rubana said government officials lack coordination and transparency required for boosting private investment.
She also said the readymade garment businessmen are trying to diversify their products and markets with new processes and technologies.
Paban Chowdhury, executive chairman of the Bangladesh Economic Zone Authority, said, "Policies will not work and we will not get out of the trap of the middle-income economy if bureaucrats do not change their mindset."
He emphasised preventing corruption to break free from the trap of the middle-income economy.
"The per capita income in Bangladesh is rising but there are 16 million people in the country who earn less than Tk163 per day," said John Smith-Sreen, economic growth office director of the UK government's Department for International Development.
He said lack of land will create crisis in Bangladesh.
"The country's export is dependent on the RMG sector only. The government and the private sector should think what is next after RMG," said John.
He called on the authorities to minimise the gap between policy and practice.
Yutaka Yoshino, programme leader of the World Bank, said Bangladesh has high export earnings from the RMG sector which is based on low-cost labour.
"But the economy is not diversifying due to lack of competition. Foreign direct investment would diversify technology and skill, and increase productivity," he added.