Analysis of Foreign Direct Investment (FDI) Inflows in Bangladesh (2020–2024): Trends, Structural Challenges, and Policy Recommendations

This report provides a comprehensive financial analysis of Foreign Direct Investment (FDI) inflows into Bangladesh over the period 2020–2024, based on data from Bangladesh Bank and BIDA. The study reveals a clear inverted-V pattern — FDI rose to a peak of $1,572 million in 2021 driven by post-COVID recovery, then declined for three consecutive years, dropping sharply to $1,270 million in 2024 (a −13.25% fall). Over the five-year period, total FDI amounted to $7,289 million with an annual average of $1,458 million, while the Compound Annual Growth Rate (CAGR) stood at a concerning −3.6%, indicating a structural decline rather than a temporary dip. Key factors behind the downturn include energy infrastructure deficits, BDT depreciation (~25–30% against USD), global interest rate hikes, banking sector vulnerabilities, political transition uncertainty, and bureaucratic barriers. The report concludes with targeted policy recommendations across short, medium, and long-term horizons to reverse the decline and attract $2,000M+ in annual FDI by 2027.