Pakistani investors, tired of the acute energy shortage and fluctuating tariffs of utilities, had set up textile units in Bangladesh looking for a better option. But now they feel they should not have relocated. For one, the policies of the Bangladeshi government have created insecurity among Pakistani investors. They are finding the system difficult to deal with. And Bangladesh on its part feels Pakistan has gone to town over the collapse of a textile factory building in Dhaka and given that country bad press.
Meanwhile investors in Bangladesh are worried and insecure. As a result new Pakistani investors have scrapped their plans to set up units in Bangladesh. Pakistan has attained the GSP-Plus status, but its energy crisis, huge tax rate, no rebate, delays in refunds and other such issues have played spoilt sport. All these factors had prompted many Pakistan-based units to shift to Bangladesh.
Most of the set up in Bangladesh were that of home textile en-cashing on the duty-free access that Bangladesh-based factories have in EU being least developed country . But the grant of GSP Plus status to Pakistan means that Pakistani local exporters have been provided the same facility back home.