Foreign Direct Investment in Bay of Bengal Initiative
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Foreign direct investment (FDI) in the Bay of Bengal initiative for Multi-Sectoral Technical and Economic co-operation’ (BIMST-EC) comprising Bangladesh, India, Myanmar, Sri Lanka, Thailand, Bhutan and Nepal has declined to US$12 billion in 2003-04 from US$15 billion in 1999-2000, according to an ASSOCHAM study.
An analysis conducted by associates chambers of commerce and of India revealed that India on an average accounted for 69.6% while Thailand attracted 21.7% of total FDI inflows in the region during the year 2003-04.
ASSOCHAM president M.K.Sanghi said in a statement that,” The region has lagged behind in attracting FDI because it still operates within framework of regulatory reforms beside it faces infrastructure and procedural bottlenecks. Socio political conditions are not so conducive to attract foreign investors.”
A study said despite the fall in FDI the total International trade from the region has increased rapidly. Total exports from BIMST-EC countries have increased to US $143.2 billion in 2003-04 fromUS$ 104.9 billion in 1999-2000 and imports touched to US$152.5 billion fromUS$103.4 billion in 1999-2000.
The US is the leading trade partner with BIMST-EC countries followed by Japan and Singapore.
The member countries feel that integration of textile and clothing sector into WTO would impact the exports prospects of the region, as majority of them are exporters of textiles and clothing. There is need of strong ties among themselves with introducing innovations in these areas to increase shares in the overseas market.
