Gas-power crises need to be resolved for the sake of investment
The government is working on establishing 100 economic zones to attract foreign and private investment. To achieve the desired investment in these economic zones, uninterrupted supply of gas and electricity must be ensured
Foreign and private investments in the country have stalled since the post-pandemic period. The economic instability triggered by the Ukraine-Russia war further affected the global economy, and this impact is also evident in the country's economy.
Overall, there has been considerable uncertainty in both the national and global economies.
Currently, an uninterrupted supply of gas and electricity is not available in the country. According to the government, an uninterrupted supply of gas will not be possible before 2026.
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As a result, the country is experiencing disruptions in the uninterrupted supply of gas and electricity, while uncertainty prevails in the global economy. In this situation, businessmen are reluctant to take the risk of making new investments. An exporter must consider the exchange rate at which he will sell his products in foreign markets before investing. Such assumptions are currently impossible due to the global instability, making investors hesitant.
Additionally, the sudden shift to market-based interest rates and the introduction of a crawling peg system for the exchange rate will increase import costs. This will also raise the investment and production costs for industries, which will also impact new investments.
In the budget for the next financial year, the government should take steps to control inflation, stabilise the dollar exchange rate and interest rates, resolve the energy crisis, and address the challenges following the LDC transition. In this context, ensuring a business and investment-friendly environment is crucial.
The government is working on establishing 100 economic zones to attract foreign and private investment. To achieve the desired investment in these economic zones, an uninterrupted supply of gas and electricity must be ensured.
The investment environment should be made more conducive. Businessmen's confidence will increase if the next budget provides additional benefits for new investments. The government has already formulated logistics policies to reduce the cost of doing business. Proper implementation of these policies will decrease business time and costs, thereby stimulating investment.
Mahbubul Alam is the president of the Federation of Bangladesh Chamber of Commerce & Industry (FBCCI) for the 2023-25 term.
