Industrial Zone Expansion in Bangladesh: Where to Invest Next

As Bangladesh strides toward its 2041 Vision of becoming an upper-middle-income country, one of the most pivotal drivers is the expansion of industrial zones. These zones—often known as Export Processing Zones (EPZs), Special Economic Zones (SEZs), or Industrial Parks—are transforming the country’s economic landscape by attracting foreign direct investment (FDI), generating employment, and boosting export competitiveness.

For businesses and investors looking to enter or expand in Bangladesh, knowing where to invest next within the country’s growing industrial ecosystem is crucial.

Why Industrial Zones Matter

Bangladesh’s industrial zones offer:

• Tax incentives

• Duty-free import of machinery

• Streamlined licensing and customs clearance

• Better infrastructure and logistics connectivity

• Clustering of related industries for value chain efficiency

These zones are strategically located to optimize trade flows, especially via key ports like Chittagong and Mongla, and are increasingly backed by government-private partnerships.

Key Government Bodies Leading Expansion

1. Bangladesh Economic Zones Authority (BEZA)
   Oversees planning and development of 100 economic zones.

2. Bangladesh Export Processing Zones Authority (BEPZA)
   Manages 9 EPZs across the country catering to export-driven industries.

3. Public-Private Partnership Authority (PPPA)
   Facilitates collaboration on large-scale industrial and infrastructure projects.

Top Industrial Zones to Watch in 2025

1. Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN), Mirsarai

• Location: Chattogram

• Size: 30,000+ acres

• Sector Focus: Textiles, logistics, electronics, light engineering

• Why Invest: Largest planned industrial city in South Asia, near Bay of Bengal and Dhaka-Chattogram Highway.

👉BSMSN Project Overview

2. Mongla Economic Zone

• Location: Khulna Division

• Sector Focus: Shipbuilding, agri-processing, leather

• Strategic Advantage: Close to Mongla Port and Sundarbans

• Foreign Interest: Attracting Indian, Japanese, and Chinese investors.

3. Kamalapur Inland Container Depot (ICD) Zone, Dhaka

• New Hub for Logistics

• Located near the central railway network and ICD.

• Offers potential in e-commerce warehousing, freight consolidation, and cold storage.

4. Ishwardi EPZ, Pabna

• Already housing textile and apparel exporters.

• Proximity to northern agriculture belt opens scope for agri-processing, food packaging.

👉 Full List of EPZs – BEPZA

5. Araihazar Economic Zone (Japanese EZ)

• Backed by JICA and Japan International Cooperation Bank

• Japan’s flagship investment zone in Bangladesh

• Designed to host high-tech industries including electronics, precision machinery

In 2022, Sumitomo Corporation began infrastructure development.

What Sectors Are Seeing the Most Demand?

With industrial zones diversifying beyond garments, several key sectors are heating up:

Criteria for Selecting the Right Zone

When choosing where to invest next, consider:

• Proximity to port or airport

• Target market (export vs. domestic)

• Incentives offered (tax holidays, VAT exemptions)

• Labor availability

• Utility readiness (gas, electricity, fiber optic internet)

• Zone management (public vs. private)

Challenges to Watch

Despite the rapid industrial expansion, investors should be aware of:

• Land acquisition delays

• Regulatory red tape in non-EZ areas

• Insufficient logistics outside major corridors

• Power outages in underdeveloped zones

However, most government-backed zones provide dedicated investor services to mitigate these risks.

Case Study: GPH Ispat in BSMSN

GPH Ispat, a leading Bangladeshi steelmaker, invested in the BSMSN zone to expand its production facility. By leveraging port proximity and uninterrupted power, they increased export capability and cut logistics costs by 20%.

What’s Next for Investors?

The government is now offering:

• Long-term land leases

• Profit repatriation guarantees

• Simplified customs procedures

• Skill development partnerships

As Bangladesh integrates deeper with regional supply chains and eyes $100B in exports by 2030, industrial zones will play a central role.

Conclusion

Industrial zone expansion in Bangladesh is not just about land and factories—it’s about joining a fast-growing economy positioned between South and Southeast Asia. For international manufacturers, traders, and tech-driven SMEs, choosing the right industrial zone can unlock tax benefits, faster market access, and efficient logistics.

As the infrastructure improves and more zones become operational, the next five years will be defining for smart industrial investments in Bangladesh.

Further Reading:

• Invest Bangladesh Portal

• Bangladesh Export Processing Zones – BEPZA

• Bangladesh-agent.com