# Introduction angladesh is a developing country. Government of Bangladesh is looking forward to be a middle income country within 2021. In order to do that requires huge investment. There exists a saving investment gap. Investible fund may come from internal as well as external. External sources may foreign direct investment and foreign aid. Foreign Direct Investment is considered as one of the crucial ingredients for fostering economic development of developing country. The gap between actual flow of total investment and target of Government articulated in the medium term macroeconomic framework is on the rise and might grow sharply in the upcoming years [1]. FDI plays an important part in creating jobs but also considered as a source of income. But the strong argument in favor of public support to FDI is based on the prospect for knowledge spillovers. Indeed, FDI appears as the way to get capital without assuming the risk linked to the debt. Despite the controversies surrounding the benefits and cost of FDI a number of developing. Governments have now changed their policies from restricting towards promoting foreign investment [2]. The gains from FDI inflows are unquestionable as it contributes to economic growth through an increase in productivity by providing new investment, better technologies and managerial skills to the host countries. The impact of FDI on economic growth depends on the degree of capacity of the host country to use FDI efficiently. Similarly, trade liberalization may facilitate economic growth through efficiency in production by utilizing the abundant factors of production more effectively and absorbing better technologies from advanced countries. On the one hand, it may harm the growth process through various forms of macroeconomic instability such as terms of trade deterioration and balance of payments crisis. Therefore, it is a challenge for developing countries to find out the appropriate direction of the role of FDI and trade liberalization in economic growth [3]. FDI is considered as an important tool for economic development of developing country. If the investing country is wealthier than the host country then capital will flow to the host country [4]. # II. # Literature Review Foreign direct investment has great impact on the development of developing country like Bangladesh. Several studies have been conducted on FDI. Faruk in his study "Effect of FDI to accelerate the economic growth of Bangladesh and some problem and prospect of FDI"found that FDI has greater impact on GDP or economic growth of Bangladesh [5]. Saha has seen that market instability, natural disaster, political instability, corruption, bureaucratic difficulties, power generation, inefficient labor, poor infrastructure, lack of joint effort, investors suspicious sentiments, regional and international politics are considered to be the hindrance in getting the sound FDI in Bangladesh [6]. Macroeconomic environment, governance, infrastructure, financial incentives, international integration, political stability, human resources, technological infrastructure plays vital role to bring more FDI in Bangladesh [7]. Nasrin et al in the paper "Major determinants and hindrance of FDI inflow in Bangladesh: perceptions and experience of foreign investors and policy maker" cheap labor, government incentives, investment friendly public policy and geographical location attract FDI [8]. Bhattacharya in his article he shown that industrious low cost workforce, strategic location, regional connectivity, strong vibrant local market and growth, openness to trade, low cost energy, proven export competitiveness, export and economic zones financial and fiscal incentives brings more FDI [9]. Alam in his paper shown that Bangladesh offers various fiscal, financial and other facilities to his research found that market size, labor cost, human resources, macroeconomic instability, regulatory policy, trade performance and competitiveness affect FDI [2]. Kafi et al in their study opined that infrastructure, macroeconomic environment, governance, international integration, political stability, human resources, technological infrastructures, bureaucracy, political unrest, corruption, insufficient power supply are fundamental ingredients to secure FDI [11]. Shahabuddin et al the study investigated that Bangladesh provides tax incentives, direct financial grants subsidies, loan guarantees to find more FDI [12]. # III. # Objective of the Research Work The study is conducted for attaining the following objectives, ? To show the scenario of FDI. ? To analyze the incentives available for investor in Bangladesh. IV. # Research Methodology The present study is conducted based on secondary data. These data have been collected from various sources. They are -journal, books, Daily news paper, Bangladesh economic review, Bangladesh bank, Bureau of statistics, various websites. The analysis has been performed through tabular form, charts, and diagrams on the basis of available data. Specially methodology is known as content analysis. V. The figure-IV shows joint venture investment in different sector. The service sector investment alone 65.80% and investment in chemical secctor is 13.89%. # Foreign The lowest investment in Printing publishing and packaging is accounted only 0.17% of total investment. # Special incentives for power sector Incentives for private sector power generation for private sector power generation policy of Bangladesh (revised in Nov 2004) provide a number of fiscal incentives for foreign investment in power sector [14]. Some of them are depicted below. ? The private power companies shall be exempted from corporate income tax for a period of 15 years. ? The companies will be allowed to import plant and equipment and spare parts up to ten percent of original value of total plant and equipment within a period of twelve year of commercial operation. VII. # Global # Conclusion There are number of positive factors which can draw attention of foreign investor from developed and developing country. Factors those make Bangladesh distinct from other country are availability of skilled and unskilled labor, relative low wage, natural resources, port, geographical location, large size of local market, reasonable macroeconomic environment. To attract more FDI, the Government of the People's Republic of Bangladesh has offered many fiscal, financial and other incentives for foreign investors. Still, it is seen in the study that actual FDI investment has been remain at very insignificant level compared to registered FDI investment proposal. 2![Figure 2 : Shows 100% foreign investment in different sector from 1990-2010](image-2.png "Figure 2 :") ![Global Journal of Management and Business Research Volume XIII Issue XI Version I Scenario and Incentives of Foreign Direct Investment (FDI) in Bangladesh d) Joint Venture Investment Joint venture investment refers to investment by Bangladeshi investor and foreign investor. The investment comes in the form of equity, borrowings and reinvested earnings of existing the projects. The highestTable 3 : 100% foreign investment in different sector. joint venture investment had come in the year of 2008 of USD 2403.328 million and the lowest investment USD 1.938 million in year of 1981](image-3.png "C") 3![Figure 3 : Shows Joint Venture Investment trend from 1977-2010](image-4.png "Figure 3 :") 4![Figure 4 : Shows joint venture investment in different sector from 1977-2010](image-5.png "Figure 4 :") ![Scenario and Incentives of Foreign Direct Investment (FDI) in Bangladesh problems and prospects of FDI"; Asian Business Review.Vol.2, Issue.4 (2013) p.p .37-43.](image-6.png "C") 1Sl ParticularsNo.unitsInvestment in (USDEmploymentregisteredmillion)(person)A100%Foreign Investment4187012.768141957BJoint Venture Investment117910172.470259207Total159717185.238401164Source: Investment Implementation Monitoring Cell (IIMC), Board of Investment100% Foreign Investment:received the highest USD 3197.623 million and yearThe below table shows yearly 100% foreign1994 received lowest USD 0.200 million investment. Theinvestment registered in Bangladesh employmentfluctuation may cause of political unrest and incentivesopportunities for the period of 1990-2010.and appears thatto the investor.there is fluctuation in investment. The year 2005 has 2increase flow of FDI in Bangladesh [10]. Bouoiyour in2013earY( )b)YearInvestment in (USD million)Employment Opportunities(Person)19900.62310019912.841344199218.91920619930.200150199428.0372521199510.318252199622.25741251997191.242399819981018.87138871999436.90713116 SlSectorsNo. ofInvestmentPercentage ofEmploymentunitsin(USD million)investment total(person) opportunities1Agro based59154.2912.20244342Chemical651985.93828.3161473Engineering5738.9630.5643884Food and Allied1319.1120.2716625Glass and Ceramics38.1880.123286Printing publishing and packaging72.2690.033257Tannery and Rubber products44.0130.066028Textiles115221.2593.16845789Services914775.90168.101875810Miscellaneous72.8340.04735Total4187012.678100141957 4YearJoint venture investment in (USDEmployment opportunities(person) 52013earY20( )Sl SectorsNo. ofInvestmentPercentage ofEmploymentunitsin(USDtotalopportunities(pmillion)investmenterson)1Agro based111329.8073.24125882Chemical1691413.02513.89213193Engineering151412.8214.06188474Food and Allied5054.6500.5430695Glass and Ceramics1569.4240.6823346Printing publishing and packaging1317.1590.178777Tannery and Rubber products4285.7540.84172198Textiles3201093.16810.741350539Services3016693.35265.794739410 Miscellaneous83.3100.03507Total117910172.47100259207Source: Investment Implementation Monitoring Cell (IIMC), Board of Investment © 2013 Global Journals Inc. (US) Agro basedChemicalEngineeringFood and AlliedGlass and CeramicsPrinting publishing and packagingTannery and Rubber productsTextilesServicesMiscellaneous3.24%0.03%13.89%4.06% 0.54%0.68% 0.17%0.84%10.74%65.80%g) Registered FDI Inflows and Actual FDI Investment 6YearRegistered FDI investmentActual FDI investment in USD © 2013 Global Journals Inc. (US) ## The package of Incentives is Listed Below Many developing countries have developed their economy tremendously through attracting FDI ? Repatriation of equity along with dividends will be allowed freely. ? Exemption from income tax in Bangladesh for repatriation of equity along with dividends will be allowed freely. ? Exemption from income tax in Bangladesh for foreign lenders to such companies. ? Tax exemption on interest on foreign loans. ? Avoidance of double taxation incase of foreign investors. ? Remittance of up to 50% of salary of the foreigners employed in Bangladesh and facilities of for repatriation of their savings and retirement benefits at the time of their return. ? No restriction on issuance of work permit. ? Provision of transfer of shares held by foreign shareholders to local shareholder. ? Re-investment of remittable dividend to be treated as new foreign investment. ? Facilities for repatriation of invested capital, profits and dividends. ? Free importing of furnace oil, equipments, and spare parts for captive and commercial power plants entrepreneurs. ? License fee for captive power of taka 500000 is waivered. * Source: Investment Implementation Monitoring Cell (IIMC), Board of Investment e) Trend of Joint Venture Investment from Year 1977-2010 * There is a upward trend up to year 1990 again a drift in trend line and again upward trend to 1997. The trend line in at the peak in year 2008. The reason for that are incentives and change of Government and change of regulations Like 100% foreign investment joint venture investment also shows no specific trend * Scenario of Foreign Direct Investment in Bangladesh: An Evaluation AKSaha ISOR Journal of Business and Management 5 6 2012 * Foreign Direct Investment Scenario: Bangladesh Perspective MABillah Thoughts on Economics 22 01 2010 * Major Determinants and Hindrance of FDI inflow in Bangladesh: Perceptions and Experiences of Foreign Investors and Policy Makers SNasrin ABaskaran MMuchie GLOBELICS-8th International Conference Kuala Lumpur, Malaysia Nov.1-3 University of Malaya * FDI in Bangladesh: An Overview DBhattacharya Journal of the American Chamber of Commerce in Bangladesh 5 1 2012 * Incentives: Tools for Attracting Foreign Direct Investment in Bangladesh MSAlam * Foreign Direct Investment in Bangladesh: Problems and Prospects MAKafi MMUddin MMIslam M The Journal of Nepalese Business Studies 4 1 2007 * An Analysis of Tax Incentives to Attract FDI in Bangladesh: An Empirical Study MAShahabuddin MMChowdhury GMAzam China-USA Business Review 12 8 2013 * Prime Minister's Office, Government of the People's Republic of Bangladesh Foreign Direct Investment in Bangladesh 1971-2010 Board of Investment * References Références Referencias * Bangladesh Economic Update 3 2 February 2012 * The Determining Factors of FDI in morocco JBouoiyour 2003 University de pau et des pays del * A note on casual relationship between FDI and Savings in Bangladesh MSalauddin IMShahbaz MChani Theoretical and Applied Economics XVII 11 2010 * The impact of Foreign Direct Investment on wages and employment LZhao Oxford Economic Papers 50 1998 * The Effect of FDI to Accelerate the Economic Growth of Bangladesh and some MFaruk