Bangladesh is seeing a surge of big-ticket Chinese investments, with several major projects signed off in recent weeks as companies look to sidestep US tariffs and tap into the country’s growing export potential.
The surge follows Washington’s decision to lower its reciprocal tariff on Bangladeshi goods – a move that has made relocation deals far more attractive to Chinese
manufacturers caught in the crossfire of the US-China trade war.
The shift is most visible in the readymade garment (RMG), textile and infrastructure sectors, where Chinese firms are stepping up production plans and locking in long-term agreements.
Economists say the influx could quicken Bangladesh’s industrial growth, create tens of thousands of jobs, and strengthen its role in global supply chains.
Among the headline projects, Chinese manufacturing giant China Lesso Group has secured 12.5 acres in the National Special Economic Zone for a $32.77 million facility producing construction and
renewable energy products.
Kaixi Group is pouring $40 million into an apparel and accessories plant at the BEPZA Economic Zone in Mirsarai, expected to employ more than 3,000 people.
Hong Kong-based Handa Industries has upped its planned investment in Bangladesh’s textile sector from $150 million to $250 million, citing a stronger investment climate. Its three factories – two garment processing units and one knit-and-dyeing plant – are forecast to create 25,000 jobs.
A senior Bangladesh Investment Development Authority (BIDA) official told the Daily Sun the tariff decision would be a “positive tailwind” for both local and foreign investors. “It is an opportunity that must be capitalised on.
“We are receiving foreign direct investment from China as well as other countries. China is giving priority to investing here as the situation is business-friendly,” the official said.
“Recently, a large delegation of Chinese businessmen, led by its commerce minister, visited Bangladesh to assess the investment environment. They are positive about investing here,” the official added.
US tariff dynamics boost Bangladesh’s appeal
Recent moves in US trade policy have further strengthened Bangladesh’s attractiveness to foreign investors.
US President Donald Trump on Monday delayed the reinstatement of high tariffs on Chinese goods for 90 days, following the latest round of talks between US and Chinese trade negotiators in Stockholm.
Had the tariffs snapped back, duties would have returned to their April peak of 145% on Chinese imports, with China’s retaliatory duties at 125%. Instead, most tariffs remain paused at 30% for the U.S. and 10% for China, giving manufacturers more flexibility to explore alternative production bases.
At the same time, India faces a 25% reciprocal tariff on all goods, with an additional 25% levy on certain products, including gems, taking the effective rate to 52.1%.
By contrast, the Trump administration has reduced its reciprocal tariff on Bangladeshi goods from 35% to 20%, giving Bangladesh a clear competitive edge in the US market.
Trade analysts say these developments have made the country an increasingly attractive destination for Chinese and other foreign investors looking to produce for export.
Dedicated economic zones for Chinese investors
The Bangladesh Economic Zones Authority (BEZA) plans to establish two exclusive economic zones for Chinese companies, targeting more than $1.5 billion in investment and thousands of jobs.
Chandpur Economic Zone-1, spanning 3,038 acres in Matlab North upazila, Chandpur, will be developed by state-owned Power Construction Corporation of China Ltd (PowerChina) under a government-to-government agreement.
The second zone – the Bhola Eco-Development Economic Zone – will be set up in Bhola Sadar and Daulatkhan upazilas by Leez Fashion Industries Limited, a Chinese firm already operating in Bangladesh.
BEZA is also expanding the existing Chinese Economic and Industrial Zone in Anwara, Chattogram. Officials note that higher US tariffs on Chinese goods have pushed many export-oriented Chinese manufacturers – and suppliers of raw materials for Bangladesh’s RMG sector – to shift production to Bangladesh.
Chinese FDI climbing sharply
Chinese investment reached $113.48 million in the first quarter of 2025 alone, while the total inflow for 2024 stood at $208.23 million.
Mustafa K Mujeri, former chief economist of Bangladesh Bank, told the Daily Sun that Bangladesh should “seize the opportunity” to attract more Chinese capital.
“Bangladesh is a suitable place for China to expand its business and investment. The country’s investment promotion agencies should ensure the necessary facilities and services for Chinese investors are provided smoothly,” he said.
He added that deeper economic ties with China could bring huge employment gains: “This investment is building livelihoods, creating jobs, and delivering long-term benefits to local communities.”
FDI surges to record highs
According to Bangladesh Bank, net FDI hit $864.63 million in the first quarter of 2025 – up 114.31% from $403.44 million a year earlier, and 76.31% higher than the $490.40 million in the final quarter of 2024. Equity investment more than doubled year-on-year, from $188.43 million to $304.38 million.
Government sources say that between December 2024 and May 2025, investment promotion agencies received proposals worth $1 billion – evidence, they argue, of growing investor confidence bolstered by stabilising exchange rates, inflation and foreign reserves.
Reforms paying dividends
BIDA has rolled out reforms in four priority areas: speeding up high-impact projects, expanding and upgrading its One-Stop Service (OSS), resolving investor concerns swiftly, and building a strong investment pipeline.
An investor relationship management team – partly staffed by private-sector hires under an exchange model – now supports new entrants, while work continues on a unified investment portal linking OSS across multiple agencies.
BIDA has also launched a redesigned website featuring updated policy guidelines, sector-specific investment opportunities, and direct contacts for key ministries.
Promotion efforts in priority sectors and markets remain ongoing, coordinated with the private sector and building on April’s Bangladesh Investment Summit.
