Business leaders say lawsuits, harassment, arson, factory takeovers, and labour unrest have pushed the country’s trade and investment into a crisis of confidence. Many investors now struggle just to protect their capital, rather than considering new investments. Conversations with entrepreneurs and experts reveal a grim picture, as the wheels of productive industry slow down.
After the political shift on 5 August, a wave of cases, vandalism, and violent labour protests created a culture of fear. Many business owners fled abroad, most of whom have not yet returned. Their idle factories now struggle, leaving thousands of workers facing financial hardship. The renewed trend of businessmen leaving the country under political uncertainty has alarmed analysts, who call it a dire warning for the economy.
Entrepreneurs say their hopes of recovery have faded. Despite government assurances of positive measures, large sections of the business community remain uneasy. Analysts note that the climate of lawsuits and intimidation continues to push back investment and job creation.
Former FBCCI president Abdul Awal Mintoo told Kaler Kantho, “Private industry cannot improve until the political turmoil ends. Investment requires not just money but also a stable environment. Financial institutions are already in poor shape, and only a free, fair election producing a democratic government can restore confidence.”
Mahfuz Kabir, research director at the Bangladesh Institute of International and Strategic Studies (BIISS), said, “Harassment through lawsuits has discouraged many from investing, and some have left the country. BGMEA and BKMEA data confirm that over a hundred factories have shut down, while others have laid off workers. Despite government efforts, confidence has not returned. Restoring trust is now urgent.”
Former DCCI president Ashraf Ahmed explained that investment in any given year affects growth for several years. He warned that low investment in 2025 could slow the economy’s trajectory, fuelling unemployment and poverty. “Bangladesh needs stable growth to reduce poverty, even at a minimum level,” he said. “Without stability, short, medium, and long-term recovery measures may prove impossible.”
Factories in flames
From early August, unrest hit industrial hubs in Gazipur, Ashulia, Narayanganj, and Chattogram, particularly in the ready-made garment sector. Sudden labour protests, arson, and vandalism caused losses worth hundreds of crores. BGMEA reported that over 400 factories were affected, forcing some owners to shut down production indefinitely.
One businessman, speaking anonymously, said, “In my 30 years of business, I never faced such nightmares. I risked my life guarding my factory day after day, but finally a mob stormed in, looted, and set fire to it. The financial loss is devastating, but worse is the wall of fear and mistrust between owners and workers.”
BGMEA president Mahmud Hasan Khan admitted that some owners left the country for political reasons, while others faced false lawsuits. He said BGMEA had contacted the home ministry to stop harassment and demanded urgent government action on law and order, factory security, high bank interest rates, and fuel shortages.
Mustafa K Mujeri, former BIDS director general and chief economist of Bangladesh Bank, said, “We see no signs of investment growth. Private credit growth has fallen below 7 percent, the lowest in 22 years. Demand for bank loans is down, raw material imports have declined, and even existing factories are shutting. Until an elected government returns, confidence will not.”
Legal harassment and exodus
After the upheaval, many businessmen faced lawsuits ranging from inciting labour unrest to alleged ties with the former regime. Lawyers allege most of these were politically motivated.
Supreme Court lawyer Shafiqul Islam Khan Sobuj said, “After the July uprising, vested groups turned lawsuits into business. They deliberately targeted entrepreneurs who had kept the economy afloat.”
Lawyer Nahidul Islam added, “Businessmen face baseless charges that undermine the economy. The government must drop cases without specific allegations if it wants growth.”
Investment slowdown signals job crisis
The climate of fear has directly hit new investment, which in turn threatens job creation. Unemployment rose to 4.63 percent in the October–December quarter, with 2.73 million people jobless, according to the Bangladesh Bureau of Statistics.
Private sector credit growth remains weak. In July it stood at 6.52 percent, barely up from 6.49 percent in June. Bangladesh Bank data show that import LCs for capital machinery fell by 25 percent in FY2024–25. GDP growth slowed to 3.97 percent in 2024–25, down from 4.22 percent the previous year. Private investment fell to 22.48 percent of GDP, from 23.51 percent.
Government steps and business demands
The interim government has promised to support entrepreneurs and held meetings with business leaders. But business representatives insist that promises alone are not enough. They demand the immediate withdrawal of harassment cases, protection for factories and owners, predictable long-term policy, and regular dialogue between government and trade bodies.
Fahmida Khatun, executive director of the Centre for Policy Dialogue (CPD), said, “Fear of lawsuits has paralysed entrepreneurs. Many halted factory expansion, holding back the recovery momentum. Growth will not return without private sector confidence.”
Economists stress that private industry is Bangladesh’s growth engine. Without restoring business confidence, the economy cannot revive.
Mahfuz Kabir concluded, “The biggest challenge today is rebuilding trust. The government must prove through action that it is committed to a safe, business-friendly environment. Only then can private enterprise recover and drive the economy forward.”
