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Regional integration is vital for attracting FDI

BTJ Desk Report
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Regional integration is vital for attracting FDI

Enhancing regional integration, demonstrating genuine political commitment, and ensuring effective governance are identified as crucial factors in attracting foreign direct investment (FDI) in South Asia, as per expert opinion. Experts point out that the region has not fully reaped the expected benefits of the South Asian Free Trade Area (SAFTA) due to a lack of coordination and political vision among member countries.

In contrast, the Association of Southeast Asian Nations (ASEAN) members have enjoyed trade and economic advantages through friendly relations, dialogues, and partnerships.

Buwaneka Perera, Secretary General/CEO of the Ceylon Chamber of Commerce in Sri Lanka, emphasized that strong political leadership, genuine commitments, and good governance would make South Asia more attractive to FDI. Additionally, improving regional integration would yield economic benefits. She also suggested that governments should facilitate private sector engagement in regional trade by closely collaborating with business chambers.

Priyadarshi Dash, an associate professor, stressed the importance of leveraging the Global Business Challenge to attract more FDI, focusing on managerial practices, technology, skilled workers, research and development, and technical education.

Shams Mahmud, a former president of the Dhaka Chamber of Commerce and Industry, highlighted the significance of FDI for technology transfer, value addition, and backward linkage industries. However, he noted that local investment in Bangladesh significantly outweighs FDI.

Biswash Gauchan, the executive director of the Institute for Integrated Development Studies in Nepal, proposed improving regional integration by providing landlocked countries with access to the sea, as only 4 percent of South Asia’s external trade occurs within the region.

Huma Fakhar, founding chairperson of MAP Capital Holdings in Pakistan, emphasized that technology has revolutionized supply chain management, making it essential to keep business planning free from political agendas.

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