The economy of Bangladesh is primarily dependent on agriculture. About 84% of the total population lives in rural areas and are directly or indirectly engaged in a wide range of agricultural activities. Agriculture contributes about 20.29% (Source: Bangladesh Economic Review – 2011 Bangla Version) to the country’s GDP- 23%. About 43.6% (Source: Bangladesh Economic Review – 2011 Bangla Version) of the labor force is employed in agriculture with about 57% being employed in the crop sector.
The abundance of natural resources available in Bangladesh supports a range of highly profitable investment opportunities in agribusiness. Over 90 varieties of vegetable are grown in Bangladesh, yet in this fertile land there is under utilization of the country’s agricultural capacity. This presents many opportunities for investors seeking to export agricultural products, or to meet the rapidly growing local demand.
Thriving in this sector are canned juices, fruits, vegetables, dairy and poultry. The country offers:
- Huge supply of raw materials exist for the agribusiness industry.
- A tropical climate for all year growing, a lot of fresh water, indeed a land interspersed with numerous rivers, available land with fertile soil.
- Government and NGOs conduct regular training programs to develop skilled manpower in the industry.
- Wide range of biodiversity exists for different crops.
- Agricultural commodities have a comparatively higher value added than non-agricultural commodities.
There is a wide variety of investment opportunities including:
- Cold storage facilities serving the supply chain, especially fresh produce for export.
- Fresh produce production for local and export markets.
- Production of fertilizers and cultivation of seeds.
- Eco-friendly jute production, supported by jute technology development institutes.
- Shrimp farming.
- Halal foods.
- Milk and dairy products.
- High value-added foods for export, including herbs, spices, nuts and pulses.
Bangladesh has the essential attributes for successful agri-based industries namely rich alluvial soil, a year-round frost-free environment, available water and an abundance of cheap labor. Increased cultivation of vegetables, spices and tropical fruits now grown in Bangladesh could supply raw materials to local agribusiness industries for both domestic and export markets.
Progressive agricultural practices, improved marketing techniques and modern processing facilities have raised the quality of agribusiness and expanded production levels significantly.
The government encourages development of the agricultural sector through measures to increase crop sector productivity and production of non-crop agriculture. To achieve this it provides increased credit, and facilitates greater access to inputs and modern technology. Investments in agribusiness industries in Bangladesh are encouraged with the following support measures:
- The Equity Entrepreneurship Fund for development of agribusiness industry.
- Special loan facilities available to set up an agribusiness.
- Agribusiness industry enjoys tax holidays.
- Any investment in this sector will enjoy similar tax amnesty as available in other sectors.
- Imposition of supplementary duty on mango, orange, grape, apples, dates and others to utilize the high quality and cheaper local resources.
- Cash incentives to the exporters ranges from 15% to 20% in various sub sectors.