Foreign direct investment (FDI) in Bangladesh fell by nearly 26 percent year-on-year during October to December, according to the Bangladesh Bank’s quarterly update released on Tuesday. The report shows net FDI at 363.8 million dollars, down from 490 million dollars in the same period a year earlier. However, compared with the previous quarter, investment rose 15.47 percent from 315 million dollars in July–September.

The interim government has managed to stabilize the financial sector after the fall of the previous Awami League administration, preventing further decline in foreign reserves and improving remittance inflows. Yet, new foreign investment remained weak amid political unrest, energy shortages, high inflation, and elevated interest rates. Sector insiders said these factors discouraged investors and slowed business activity.

China was the top investor during the quarter with 77.2 million dollars, followed by Hong Kong, the United Kingdom, South Korea, and Singapore. The power sector attracted the highest investment at 102 million dollars, followed by banking, textiles, and telecommunications. Despite some quarterly improvement, the overall investment climate remained unsatisfactory, the report indicated.