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Start-ups & The Recent Chinese Investment

by SteamPug Writers

· Market Insight 2016,Foreign Investment,Bangladesh

With the recent visit of the President of The People's Republic of China, Xi Jinping, came a wave of new opportunities for both Chinese and Bangladeshi firms. Apart from the deals signed between the two countries, our main focus should be on the private investments that also took place with the President's visit, looking to boost bilateral trade.

On October 13, the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) and China Council for Promotion of International Trade (CCPIT) jointly organized a programme at Sonargaon Hotel, where 11 private companies and three government bodies signed deals with Chinese investors. The total amount invested racks up to a whopping US$13.6 billion, with no information being given regarding the deals. Since digitization is the current focus for startups, they soon will be able to expand their services to meet the substantial requirements to partake in the investments.

Infrastructure:

Chinese investors are investing in power plants and highways mostly, but since we have no solid details, we can assume we will see traces of investment in infrastructure development. This can mean better connectivity which is great news for startups working in logistics, rural development, fair trade, agriculture etc. In case of power generation, the private entities may ask startups like Toru - The Idea Tree and Bondstein to incubate their ideas and pilot them.

Jute:

Since jute products are vat free, we can soon expect new startups dealing with this industry to rise, as our government encourages its production. Startups might be enterprises selling jute merchandise, or businesses in regulating or marketing this targeted industry.

Automobile:

Not much about automobile investments was revealed, so we’ll have to assume that they will mainly involve public/private transport, cargo transport, logistics, or provide traffic solutions for a jam-free city. Startups can engage in these sectors by providing management, financial support, logistics, consultancy, traffic solutions and road plans to the entities hiring them.

 

Leather, ready-made garments and pharmaceuticals:

These entities are run by massive independent companies, startups can offer very little to these sectors. They are already being operated at full efficiency and at most startups can help by providing better methods of production or pitch newer innovations to invest in. Either way the barriers to entry to these industries range from political to syndicated issues, which startups will have difficulty overcoming.

 

Overall, even in the face of such huge figures, startups can and will be a part of the massive investments that are soon to follow. Having more room to employ, startups will be the perfect choice for outsourcing work for our private companies, only because of the specialized nature of these establishments. With time, we will know the full nature of the deals made, and also, newer startups will emerge targeting these sectors. The time to start new businesses has never been more appropriate, and I believe the time to act is now, before the market for ideas for these sectors are saturated.

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