Bangladesh eyes foreign investment to unlock agro-processing potential

Highlights:

• Bangladesh's agro-processing sector poised for major growth and foreign investment
• Processed food market projected to reach $5.8 billion by 2030
• Lack of infrastructure causes food surplus waste, hurting farmer profits
• Summit aims to attract global investors to agro-processing opportunities

With over 70 million tonnes of agricultural production annually and a rapidly growing $7.3 billion packaged food market, Bangladesh's agro-processing sector is poised for transformative growth. 

Tapping into this potential, however, hinges on attracting robust foreign investment.

Currently contributing 1.7% to GDP and 13% to the country's manufacturing value, the agro-processing industry has already seen significant momentum. Market forecasts suggest the processed food sector, now valued at $4.8 billion, will grow to $5.8 billion by 2030. Agro-processed exports have also risen consistently, with a 16.6% annual growth rate over the past four years.

To harness this potential, the Bangladesh Investment Development Authority (Bida), in partnership with the Embassy of the Netherlands and LightCastle Partners, is set to host a dedicated session on Agriculture and Agro-Processing today, on the final day of the Bangladesh Investment Summit 2025 at Hotel InterContinental Dhaka.

The four-day summit, taking place from 7 April, has already drawn over 2,300 participants from 50 countries, including more than 550 foreign investors. Organisers said they hope the summit will serve as a milestone in highlighting Bangladesh's investment potential amid ongoing economic reforms.

Key opportunities include strengthening public-private partnerships in the seed industry to improve quality through better certification and import systems, with an emphasis on high-yield varieties and efficient distribution networks

The summit has put spotlight on five high-priority sectors – agro-processing, renewable energy, digital economy, textiles and apparel, and pharmaceuticals.

The session on Agriculture and Agro-Processing aims to bring together global investors, policymakers, and local businesses to explore opportunities in technology transfer, value chain integration, and export diversification. 

Talking to The Business Standard regarding the importance of the session, Professor Jahangir Alam, an agricultural economist, said, "Agriculture is a sector where Bangladesh enjoys a natural advantage." 

"But our agro-processing capabilities, especially for fruits and vegetables, remain underdeveloped. This summit can showcase the sector's untapped potential and attract vital investment," he said.

He added that Bangladesh already exports a wide variety of agro-processed goods globally, from the US to the Middle East. "Despite temporary tariff-related challenges, investors will eventually realise the benefit of entering a low-cost, high-yield market like Bangladesh," Jahangir noted.

According to Bida, Bangladesh produces over 70 million tonnes of Agricultural products each year, including nearly 46 million tonnes of food grains. Potatoes, fruits, and vegetables also make up a significant share. 

However, experts point out that a lack of large-scale processing infrastructure often results in wasted surplus, especially when market demand dips.

On this, Professor Abu Noman Faruq Ahmmed from Sher-e-Bangla Agricultural University pointed out, "Farmers are incurring losses due to falling potato prices, yet we continue to import products like potato flakes. If we had local processing industries, this demand could be met domestically."

"Value-added processing not only gives better returns to farmers but also reduces import dependence. We produce enough tea, yet import beauty care products made from tea extracts. The lack of industrial infrastructure is the gap foreign investors can fill," he added.

Ahsan Khan Chowdhury, chairman and CEO of PRAN-RFL Group, underscored the value of Dutch collaboration. "The Dutch bring not just capital but also cutting-edge agricultural technologies. With their expertise, we can enhance productivity and diversify our export base."

He called for greater ease of doing business to unlock investment. "We want more global players to come in and collaborate. If we can improve the investment climate, the agro-processing sector will see significant growth."

Talking to reporters on Tuesday, Chowdhury Ashik Mahmud Bin Harun, executive chairman of Bida and Beza, said, "Agro-processing remains vastly underutilised. It offers vast investment opportunities, from livestock to value-added food products. With a domestic market of over 170 million people and access to neighbouring export markets like Nepal, Bhutan, and India's northeastern states [Seven Sisters], the potential is enormous."

"Using the Chattogram seaport, it will be easy to export to these regions," he added.

Currently, Bangladesh has around 1,000 food processing units, 90% of which are small-scale. Around 250 of these companies export a wide range of products, including frozen seafood, tea, spices, fruit juice, and dry food, to more than 140 countries. 

According to Bida, the agriculture sector employs over 36.9% of the national workforce and contributes 11.2% to GDP. Meanwhile, agro-processing contributes about 3.5% to total exports, a share expected to increase.

To capitalise on this momentum, Bida has identified potential for foreign investment in several areas within the agriculture and agro-processing sector.

Key opportunities include strengthening public-private partnerships in the seed industry to improve quality through better certification and import systems, with an emphasis on high-yield varieties and efficient distribution networks.

In protected horticulture, Bida highlights prospects for expanding mid-tech greenhouses, precision irrigation, and climate-controlled farming to grow high-value crops such as cherry tomatoes, capsicum, and exotic fruits.

The poultry and fisheries sectors also present investment potential, driven by growing domestic demand and export opportunities. Areas of focus include sustainable aquaculture, modern poultry production systems, cold-chain logistics, and automated processing facilities.

In food processing, Bida points to a $7.3billion packaged food market and Bangladesh's exports to over 140 countries. Investment opportunities lie in processed fruits, vegetables, seafood, and meat, as well as in advanced packaging and manufacturing technologies.