Increased Efficiency With Free Trade Zones In Bangladesh
A country’s access to more markets around the world is facilitated via free trade zones. It has the potential to stimulate local industries to increase their competitiveness while relying less on government subsidies. It’s a process that can result in the opening of new markets, increased GDP, and new investment opportunities.
Bangladesh plans to create at least 100 special economic zones or free trade zones in Bangladesh as part of its Vision 2041. The Bangladesh Economic Zones Authority was founded in November 2010 with the goal of attracting more foreign direct investment as well as diversifying the country’s exports. It is also authorized to establish private export processing zones.
5 Special Advantage Of Free Trade Zones
1. Increased productivity
A free trade area’s benefit is that it stimulates competition, which boasts a country’s efficiency as it strives to keep up with its competitors. As a result, products and services improve in quality while costing less.
2. Countries’ specialization
Countries will tend to produce the products or goods that they are most efficient at when there is fierce competition. Profit maximization is achieved by making efficient use of resources.
3. There is no monopoly
Because more players can enter and join the market when there is free trade and tariffs and quotas are gone, monopolies are also eliminated.
4. Price reductions
When there is competition, especially on a worldwide scale, prices will almost always fall, giving customers more purchasing power.
5. Expanded variety
Imports are getting more affordable, giving customers access to a wider range of low-cost products.
Some Free Trade Areas In Bangladesh
Bangladesh currently following 16 free trade zones:
- Agailjhara Economic Zone, Barisal (Under construction)
- Anowara (Gohira) Economic Zone, Chittagong (Under construction)
- Anowara Economic Zone-2, Chittagong (Under construction)
- Ashuganj Economic Zone (Under construction)
- Bagerhat Economic Zone (Under construction)
- Bhola Economic Zone (Under construction)
- Cox’s Bazar Free trade Zone (Maheshkhali) (Under construction)
- Dohar Economic Zone, Dhaka (Under construction)
- Habiganj Economic Zone (Under construction)
- Jaliardip Economic Zone, Teknaf-Cox’s Bazar (Under construction)
- Jamalpur Economic Zone (Approved)
- Kushtia Economic Zone (Under construction)
- Maheshkhali Economic Zone-1 (Under construction)
- Maheshkhali Economic Zone-2 (Under construction)
- Maheshkhali Economic Zone-3 (Under construction)
- Manikganj Economic Zone (Under construction)
Requirements For Starting a Business In a Free Zone
If you want to open a company in one of Bangladesh’s free zones, you have to follow certain rules, which must respect the Company Law as well as the Free Trade Zones Act. Investing in any of the city-state’s free zones is allowed by both local and foreign investors, who have to get permits from the government-run PSA Corporation Authority in order to participate.
Legal Licenses & Permits to Operate in Bangladesh
To operate in Bangladesh’s free zones, businesses will need to obtain two kinds of licenses. Corporate users can receive the first, while individuals can obtain the second, which has a limited validity.
One must comply with the agency’s safety and security rules before applying for a PSA Pass.
Documents must be submitted for a temporary pass, which is usually issued by an employer or sponsor for employees in the company:
- Name of the applicant.
- Applicants must provide their NRIC numbers.
- Passport number of the applicant.
- Work permit number of the applicant.
- Date and time of applicant’s request to enter Restricted Areas.
- The reason the applicants need to enter the Restricted Areas.
Permits for a temporary stay can be obtained for 24 hours or 2 weeks, the latter being the maximum period.
The validity period of a PSA permit is either one or three years, depending on the fee. In either case, it takes the Authority no more than four days to issue the pass.
Our agents here are available to answer any questions you may have about free zones in Bangladesh.
Our Core Roadmaps For Trade Areas
All the free zones created in Bangladesh are characterized by their extensive storage facilities, which can be accessed by both local and foreign companies. Bangladesh companies will also benefit from the following:
- Throughout the free zone, transshipment of non-controllable goods is not subject to any permits or licenses.
- Free zones do not charge customs duties on goods transiting or being stored there.
- Imported products into Bangladesh’s free trade zones are not subject to GST.
- Simplifying customs procedures will benefit free zone companies.
There are several large bodies of water transiting Bangladesh’s free zones, which is a great advantage for shipping companies. We have local advisors who can help you open a company in Bangladesh as a shipping company.
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The Bangladesh Free Zone Authority has proposed flirtatious incentives for investors in 100 proposed special economic zones designed to attract manufacturing investors from home and abroad. Duty-free imports of raw materials, capital machinery, capital gains tax cuts, and more. Get in touch with NetworkBD for More.