Doing business should not be so cumbersome
At a time when the country should be supporting entrepreneurs to bolster its faltering economy, it is disheartening to learn that they are facing unnecessary hurdles in their way, costing them both time and money. According to the findings of a study on the state of doing business in Bangladesh, there are a number of regulatory barriers that make entrepreneurship quite cumbersome. These observations not only bring forth the plight of domestic entrepreneurs, but also show where reforms are essential.
For example, the research paper points out that entrepreneurs have to pay six times more than the official rates to obtain licences and permits from various government agencies in order to do business. Astonishingly, if someone wants to set up a garment factory, they need to obtain no fewer than 20 licences! Imagine shuttling back and forth between different agencies in search of the licences, which may also involve paying hefty sums in bribe. Another big barrier is obtaining finance: on top of going through a complex process to obtain loans from banks, entrepreneurs have to face the added difficulty of getting the loans at competitive rates, because most banks are burdened with massive amounts of defaulted loans.
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The question is, why are entrepreneurs being forced to pay so much to start or continue their undertaking? Where is the extra money going? And why do they have to submit all of their documents every time they need to renew a licence? What is the point of digitisation if the documents are not kept on record? It is clear that corruption has a big part to play here—a fact also highlighted by the United States Trade Representative (USTR) in the 2024 National Trade Estimate Report on Foreign Trade Barriers. These obstacles are not just affecting domestic entrepreneurs, but foreign investors too. Germany, for example, is yet to find Bangladesh as an attractive investment destination, according to the deputy head of mission of the German embassy in Bangladesh. That is why Bangladesh lags behind its competitors such as Indonesia, Vietnam and India in getting German investment.
To attract or ensure ease of business, barriers like these must be removed. When the country is struggling with a persistent rate of unemployment, entrepreneurship, particularly youth entrepreneurship, can make a huge difference. With the right support, small and medium entrepreneurs can contribute to creating employment and increasing export earnings. All they need is a supportive entrepreneurial ecosystem across all sectors. The convoluted processes of licensing must be straightened out so that entrepreneurs don't have to go through unnecessary hassles.
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