Foreign Direct Investment: Why Less FDI Comes In Bangladesh

"Comparative advantage" is the main determinant of Foreign Direct Investment (FDI) which relies on "resource seeking". It is a potent weapon of economic development, especially in the current global context. It enables a capital-poor country like Bangladesh to build up physical capital, create employment opportunities, develop productive capacity, enhance skills of local labor through transfer of technology and managerial know-how, and help integrate the domestic economy with the global economy. The major challenges for the host country are to ensure an eye-catching and conducive investment climate to foreign investors for FDI inflow. In recent years, Bangladesh has been devoting efforts for attracting FDI offering a lot of lucrative incentives and benefits. Though attempts are taken to increase FDI inflow, the result achieved is not appreciable enough for Bangladesh. This paper will portray the FDI inflow since 1995 and finds out causes and reasons of low-inflow based on secondary data. It also finds out the impediments and highlighted prospects for FDI in Bangladesh and provides some recommendations some unearthed problems.