Bangladesh

 
Bangladesh, officially the People's Republic of Bangladesh, is a country located on the fertile Bengal delta in South
Asia. It shares its borders with India to its west, north and east, by Burma to its south-east and by the Bay of Bengal
to its south. It is separated from Nepal and Bhutan by the narrow Chicken's Neck. Bangladesh has the world's
eighth-largest population with more than 160 million people, also making it one of the world's most densely
populated countries. Dhaka is the capital of Bangladesh and also the world's twentieth largest metropolitan city.
Bangladesh is identified as a next eleven economy. According to the United Nations in 2010, the country is making
major strides in human development, including significant progress in the areas of gender equity, universal primary
education, and the empowerment of women, reducing population growth, food production, health and renewable
energy. Bangladesh is a pioneer and founding member of SAARC. It is the world’s largest contributor to UN
peacekeeping operations. It is a founding member of the Developing 8 Countries and BIMSTEC, and a member of
the Commonwealth of Nations, the OIC, the NAM and the G-77
 

Bangladesh Country Information (Source: OECD)

Population 154.7 million (2012)

GDP $116.4 billion (2012)

Improved Water Resources 82%

Life Expectancy 70

Low
Income Level
 

 
PEST Analysis of Bangladesh
 

Political environment
The political system of Bangladesh is followed by representative democracy. Despite being a democratic country the
safeguards of democracy are not being exercised properly which have negative impact on business operation.
Political unrest is almost a daily occurrence in Bangladesh which hinders the daily national and international trading
system of the country. Foreign firms are feared to come in Bangladesh with FDI. Bangladesh is a democratic
country in name but not in action. The following biased democracy safeguards are some of the main hindrances of
international business in Bangladesh, such as, individual right to freedom of expression, opinion and organization
are restricted, media are more or less biased to the current government, there is more or less regular election
sometimes major parties avoid election, there are often face to face clashes among the leading political parties,
despite being the court system is independent most of the times its functions are directed by current government,
corrupted political state bureaucracy, and corrupted political police and armed force. Bangladesh is a unitary state
and parliamentary democracy. Direct elections in which all citizens, aged 18 or over, can vote are held every five
years for the unicameral parliament known as the Jatiyo Sangsadh. The Prime Minister, as the head of government,
forms the cabinet and runs the day-to-day affairs of state. While the Prime Minister is formally appointed by the
President, s/he must be a member of parliament who commands the confidence of the majority. The President is the
head of state, albeit mainly ceremonially in his/her elected post, however, the President's powers are substantially
expanded during the tenure of a caretaker government, which is responsible for the conduct of elections and transfer
of power. The officers of the caretaker government must be non-partisan and are given three months to complete
their task. This transitional arrangement was pioneered by Bangladesh in its 1991 election and then institutionalized
in 1996 through its 13th  constitutional amendment.
 

Economical Environment
The economic system of Bangladesh is characterized by mixed economy in Bangladesh certain sectors of the
economy are left to private ownership and free market mechanism while other sectors have significant state
ownership and government planning. Once there was a large state sector in Bangladesh but recent tend to
privatization has reduced state ownership of various businesses. Bangladesh is a developing nation. However, the
poverty rate has declined by 25% since 1990, and per-capita GDP has doubled from 1975 levels. Dhaka and
Chittagong, the country's two largest cities, as well as other urban centers, have been the driving force behind much
of the recent growth. Goldman Sachs named it one of the next eleven. Bangladesh gradually decreased its
dependency on foreign grants and loans from 85% to 2%, for its annual development budget. Its per-capita income
as of 2013 is $1,044 compared to the world average of $8,985. In December 2005, the Central Bank of Bangladesh
projected GDP growth around 6.5%. Bangladesh has seen a dramatic increase in foreign direct investment. In order
to enhance economic growth, the government set up several export processing zones to attract foreign investment.
These are managed by the Bangladesh Export Processing Zone Authority. Some of the recent privatized sectors are
airlines, banking, customs etc, and this tend to privatization is creating a favorable atmosphere for international
business. As foreign firms can invest in the privatized sector there will be a positive impact on the economy of
Bangladesh.
 

Social Environment
Bangladesh is also known as the land of rivers, and together with the neighboring Indian states of West Bengal and
Tripura, it makes up the ethno-linguistic region of Bengal. Social value consists of social custom, practice, religion
and social moral standard. Social value shows the moral standard of ours. Without social values we cannot grow up
as a complete social man. In the past social values were more conservative, rigid and strong. We all know that
Bangladesh is a conservative Muslim country. People used to live a more religious. The young were more respectful
to the old and superior. Smoking in front of the superior was forbidden. People used to believe in joint families. But
now people are getting more and more liberal. They follow religion in a more relaxed way. Men and women now
mix frequently. Our social values are changing fast. There is a clear western influence on our culture and values.
Many people now accept western values. The causes of the present social values are satellite, television,
globalization, free exchanges among the nations and free trade. There are certain effects of social values. People
now abide by religion in a more relaxed way. Women are now playing a more important role in different parts of our
society. As western music, culture, and modes.
 

Technological Environment
The need for faster technological development is increasingly felt in Bangladesh. Development plans of Bangladesh
have emphasized science and technological research to develop technologies through adoption of imported
technology as well as development of indigenous technologies. As the country is heavily dependent on imported
technologies, proper planning is required for its effective transfer through acquisition, assimilation and adoption. A
National Science and Technology Policy has been formulated and adopted by the Government. It has laid down the
directions for S and T activities and research, institutional and manpower development. Dissemination and
documentation facilities. The National Council for Science and Technology determines S&T policies, reviews the
activities of different institutions and provides direction towards S and T research and activities. Technology
dimension plays an important role in enhancing the development activities and growth of Bangladesh business
environment potentiality. The application of new technologies, particularly computers and software applications, has
been a major factor driving productivity growth in recent decades. It is observed that information and
communication technologies (ICT) development is running rapidly. Basically, at this moment the business people
are much more aware about technology because they know technology can enhance their operation. ICT is an
umbrella term for a range of technological applications such as computer hardware and software, digital broadcast
technologies such as radio and television, telecommunications technologies such as mobile phones, and electronic
information resources such as the world wide web. The present government has recognized IT as one of the priority
sectors and is providing all support to the private sector to enable them to enter the export market for software and
data processing services. Recognizing the bright future of IT, a large number of students, young professionals and
businessmen are taking keen interest in acquiring knowledge about computers and its applications. This is reflected
in the tremendous enthusiasm generated in the on-going International Computer Show organized by Bangladesh
Computer Samity. It is expected that within the next 3 to 4 years, IT applications in Bangladesh would not only
spread to various private and public sector offices and industrial units, but Bangladesh would emerge as a regional
hub for software development.
 
 

Future Trends in Bangladesh

The Bangladeshi government has started addressing back-end bottle necks to apparel industry growth. For instance,
work on gas transmission lines has started in order to increase the supply of gas for electricity generation over the
next few years. Electricity interruptions are an immediate hold-up to industry growth. Another speed bump, labor
unrest, is also being targeted. The aim is industry stability and gradual transition to higher value output. Because
there is such a massive workforce in the sector, labor unrest can interrupt growth. So the government is
implementing many welfare schemes and participatory decision making mechanisms for garment workers, to ensure
labor stability in the sector, The industry has already started shifting into little more high value, higher return areas.
There has been a lot of technology and skill upgrading happening. Government and industry representatives say
Bangladesh is aiming to become the leading manufacturing destination for apparel over the next decade.