Cabinet approves FDI incentive policy to encourage expatriates to attract investment in Bangladesh

Bangladesh’s cabinet approved the Foreign Direct Investment (FDI) Incentive Scheme Policy, 2026, aimed at encouraging Bangladeshi citizens, including expatriates, to attract foreign investment. The policy, initiated by the Prime Minister’s Office, was finalized during the ninth cabinet meeting on June 4, chaired by Prime Minister Tarique Rahman. Under the scheme, eligible individuals—whether inside or outside Bangladesh—will receive a 1.5% financial incentive for successfully bringing new equity-based FDI into the country, with a minimum investment requirement of $1 million. The draft policy includes a $7.5 million fund to finance the initiative, representing around 1.25% of Bangladesh’s total equity FDI inflow in fiscal year 2023-24, which amounted to approximately $600 million. The Ministry of Finance had earlier recommended reducing the incentive rate to 1% for all eligible investments, though the final policy retains the 1.5% rate. The scheme seeks to leverage the diaspora’s global networks to boost foreign investment in key sectors. In a separate decision, the cabinet approved the draft Bangladesh Medical University (Amendment) Act, 2026, proposed by the Health Education and Family Welfare Division. The amendments will allow the university to establish or participate in for-profit and non-profit entities, as well as acquire shares in such organizations, expanding its institutional and research capabilities. The changes aim to modernize the university’s operations under the existing 1998 Act. The cabinet also congratulated Khalilur Rahman on his election as president of the 81st session of the United Nations General Assembly (UNGA). The meeting concluded with these approvals and acknowledgments, marking key policy and diplomatic developments for Bangladesh.