Budget pushes reforms in ports, logistics to attract investment

Finance Minister Amir Khosru Mahmud Chowdhury today proposed a series of policy reforms aimed at attracting foreign investment, boosting exports and upgrading Bangladesh’s logistics sector to international standards.

The proposals, outlined in the national budget for fiscal year 2026-27 (FY27), include new incentives and regulatory changes covering free trade zones, off-docks, inland container depots (ICDs), air cargo operations and port management.

Earlier in the day, the cabinet approved the proposed Tk 9.38 lakh crore budget for FY27 at a special meeting.

Read more

Budget FY27: Who stands to win and lose from tax changes

While presenting the budget in Parliament, the finance minister said the government would amend the Customs Act to create a legal framework for establishing free trade zones in the country. 

These zones would allow duty-free import of goods for export-oriented storage, packaging, manufacturing and processing activities.

The plan comes as the government moves ahead with preparations to establish the country’s first free trade zone in Anwara, Chattogram, which is expected to be developed as an international trade hub modelled on Dubai’s Jebel Ali Free Zone in the United Arab Emirates.

The budget also proposes removing the existing 49 percent cap on foreign ownership in privately operated off-docks and ICDs. More than 24 private ICDs are currently operating in the country, some with foreign equity participation. 

Industry stakeholders say the change could open the door to full foreign ownership and help attract major global logistics firms.

In the port sector, the government has proposed a separate regulatory framework for private port and terminal operators to improve service quality and encourage investment. 

This move aligns with recent efforts to involve international operators in managing key port infrastructure.
Talks are ongoing with Dubai-based global port operator DP World to run the New Mooring Container Terminal (NCT) at Chattogram Port, the country’s largest container-handling facility. 

Government project documents say the modernisation, operation and maintenance plan could attract about $205 million in investment.

Meanwhile, Denmark-based APM Terminals, a subsidiary of AP Moller-Maersk Group, has secured a contract to develop and operate the Laldia Container Terminal at Chattogram Port. 

Under a 30-year concession agreement, the project is expected to involve $550 million in investment, making it one of Bangladesh’s largest public-private partnership projects and the biggest European foreign direct investment in the country’s history. 

Once operational, the terminal is expected to handle more than 800,000 TEUs annually.

Swiss logistics company Medlog has also been selected to operate the Pangaon Inland Container Terminal, with an estimated investment of around $40 million. Together, the Laldia and Pangaon projects are expected to bring nearly $590 million in foreign investment.

In another initiative, the government has proposed regulations for Air Cargo Operator Stations, allowing leading international logistics companies to take part in cargo clearance activities. 

Officials said this would help transform the international airports in Dhaka, Chattogram and Sylhet into full-scale logistics hubs and support the rapid growth of the e-commerce sector.

The budget also includes significant incentives for the renewable energy sector. The finance minister proposed exempting key solar power equipment and components from customs duty, regulatory duty, supplementary duty and advance tax until June 2031. 

He said these measures are expected to attract both local and foreign investment in renewable energy and support Bangladesh’s shift towards cleaner energy sources.