Inflow of foreign direct investment (FDI) into the country dropped 36% year-on-year in the third quarter of 2023, owing to the rising US dollar rate and political uncertainty, which affected investors' confidence.
According to Bangladesh Bank data, Bangladesh received $913 million in gross FDI between July and September, down from $1.43 billion during the same period in 2022.
Net investments plunged to $670 million from $1.1 billion.
Between January and September of 2023, FDI flow dropped 24% year-on-year to $2.8 billion.
It comes as the US dollar appreciated by around 30% against the Taka in the past two years.
It traded at Tk111 on Sunday, which was Tk86 in January 2022.
Amid higher outflows caused in the form of an elevated level of imports against moderate export and remittance receipts, foreign currency reserves have halved to around $20 billion from more than $40 billion in August 2021.
The lower flow of FDI has been one of the major factors for Bangladesh's unprecedented financial account deficit.
The financial account, a key component of a country's balance of payments (BoP), records transactions that involve financial assets and liabilities and that take place between residents and non-residents.
Figures from the central bank showed that the deficit in the financial account stood at $5.39 billion in July-November of FY24, which was $4.03 billion in July-October.
