Structural ailments holding back businesses

While young Bangladeshi entrepreneurs are eager to innovate, start businesses, and scale up, their momentum is severely hindered by process-related bottlenecks, Hossain Zillur Rahman, chairman of Power and Participation Research Centre (PPRC), said yesterday.

Beyond bureaucratic hurdles and policy inconsistencies, he identified three major state-level ailments that continuously suppress entrepreneurial energy – corruption, harassment and underperformance.

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Extortion, bribery, and rent-seeking behaviour create unfair financial burdens on emerging businesses, Hossain also said at a panel discussion at the InterContinental Dhaka, organised by the Dacca Institute of Research and Analytics.

The economist noted that these issues drain resources from young entrepreneurs at both the inception phase and the scaling phase, discouraging investment and innovation.

Harassment, he said, operates even where favourable policies exist on paper, because implementation depends on individual officials – customs officers, for instance – who interpret regulations arbitrarily.

The result is administrative friction across the system, which is as damaging as corruption itself, said the PPRC chairman.

On chronic underperformance, he pointed to state infrastructure projects plagued by persistent delays and poor execution.

He cited Dhaka’s drainage and sewage pump project, which was launched in 2013 and originally scheduled for completion by 2020, but remains unfinished years later while continuing to draw budget allocations.

“All of these are state-level diseases that are holding back business,” said the PPRC chairman.

Also speaking at the event, Zonayed Saki, state minister for planning, outlined the government’s roadmap for economic recovery, including a five-year strategic framework meant to translate plans into implementation.

Ending capital flight, he said, is essential to redirecting capital toward productive domestic investment.

He said social safety net programmes – Family Card, Farmers Card, etc. – serve both as direct support for citizens and a stimulus for consumption.

Concurrently, he added that public investment in health, education, and skills training is prioritised to boost human capital and industrial productivity to match global competitors.

On energy, the state minister said the government is moving away from an import-dependent policy through domestic gas exploration, including the purchase of five rigs and drilling of five wells, alongside expanded storage capacity. It has also set a target of generating 20 percent of energy from renewables within a decade, driven mainly by private-sector incentives.

He also cited efforts to streamline bad loan management while offering targeted support to distressed but viable industries, and described plans to merge licensing processes under Bida, Beza, Bepza, and the PPPA into a single-window system aimed at issuing licenses within two days and utility connections within seven.

To cut delays and waste in public investment, Saki said the ministry is introducing programmatic project planning, revising Project Director appointment policy to allow private-sector professionals and retired experts, simplifying inflated rate schedules, and moving toward full digital automation.

Asif Ibrahim, former president of the Dhaka Chamber of Commerce and Industry, focused on regulatory hurdles facing entrepreneurs.

Existing one-stop-service systems, such as those run by Bida and Beza, operate in isolation, he said. “There must be a single, overarching OSS to handle all licensing centrally under one framework.”

He said trade licence fees based on factory square footage disproportionately burden large manufacturers, whose annual renewal costs can reach Tk 20-25 lakh, and that fee structures should instead be scaled to company size to avoid overburdening industry.

The former DCCI president also pointed to licensing overload from multiple sector-specific clearances.

He cited a prior reform that had allowed environmental licence renewals through banks rather than requiring annual visits to the relevant department — a change that was later reversed.

Such “reverse reforms,” he said, need to end.