FDI reporting time slashed for firms, dealer banks

The Bangladesh Bank has cut down the time for foreign direct investment receiving and sending firms and their dealer banks to submit FDI reporting forms and supporting documents to the central bank.

All FDI recipients and sending firms, both 100 per cent foreign-owned companies and joint ventures, had to hand in the FDI reporting form and supporting papers to their dealer banks on a quarterly basis within a month after the end of a quarter.

Now, they will get 20 days, according to a notice of the Bangladesh Bank yesterday.

Supporting documents include all audited and un-audited financial statements and papers outlining both inward and outward FDIs.

The authorised dealer banks will verify the reporting forms. Afterwards, they will submit them to the central bank within a month after a quarter comes to an end. It was one month and 15 days previously.

Despite being a strong manufacturing destination, Bangladesh has not been able to attract a higher level of FDI.

The net FDI flow to the country stood at $3.4 billion in the last fiscal year of 2021-22, up about 36 per cent from $2.5 billion a year earlier, BB data showed.

The FDI comes in three forms: equity capital, reinvested earnings, and intra-company loans.

Net equity capital rose about 65 per cent year-on-year to $1.35 billion in FY22. It was $816.17 million in FY21.

Reinvested earnings stood at $2.04 billion, up 28.93 per cent from $1.59 billion in FY21. Intra-company loans, however, contracted 54.47 per cent to $47.90 million from $105.20 million in 2020-21, according to the central bank data.

In 2021-22, gross FDI inflows were $4.64 billion, recording an increase of $1.25 billion, or 36.9 per cent, year-on-year. FDI stock was $20.5 billion at the end of the last financial year.