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PESTLE ANALYSIS OF

BANGLADESHASSIGNMENT

1/10/2011

PESTLE ANALYSIS

Submitted to:

MR. Amit Gupta

BY:

kaushal kumar vairagi

BLR1201031002



PESTLE ANALYSIS OF BANGLADESH

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INTRODUCTION

Bangladesh is one of the most strongly populated developing countries in the world.

It is democratic country with 300 MPs elected directly by its people. The country got its

independence in the year 1971 and was tailed by 15 years rule by the military. It finally became a

democratic country in the year 1991. In the parliament, walkout by the opposite party and calling

of strikes have become common over their political culture

Capital: Dhaka

President - Zillur Rahman

Prime Minister - Sheikh Hasina Wazed

Languages – Bangla, English

Currency -Taka(BDT)

PESTLE Analysis:

PESTLE analysis is done to find out the external environment of a business and to help

businesses formulate a strategy to gain a competitive advantage. PESTLE consists of political,

economic, social, technological, legal and environmental analysis and showing the external

environment. Here, we study the PESTLE analysis of our neighboring country, Bangladesh.




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Political Factors:

Bangladesh being a very populated country always wanted to have a representative

government since its partition in 1947 from India and separation from Pakistan in 1971. It helped

in creating a democratic political system. The constitution was publicized in 1972. Later, the

hero of 1971 war Sheikh MujiburRahman changed the constitution and took over the power as a

dictator. The successors of him all were expressing military interests. But still the fight for

equality was active in the country as in the 1980’s. There started the evolution of different

political parties but each with a different view and all of them wanting to rule the country.The

socialist, the communist, the centrist and various traditional Islamic parties were few of them.

There was lot of political instability in the country during 1982 when parties refused to take part

in parliamentary politics when Hussain Muhammad Ershad was the president. It resulted in the

military to continue its autocratic rule.Ershad held power and bought in a change by introducing

2the structure of local elections in the country which showed some democratic ideals. This

resulted in bringing up new political leaders and groups for representative race throughout the

country.

Economic Factors: The economy bagaladesh of is constituted by that of a developing c

country It per capita income in 2009 was est. US$1,500) significantly lower than

India Pakistan both which are also lower than the world average of $10,497.According to

the gradation by the IMF, Bangladesh ranked as the 48 largest developing country in the

world in 2009, with a gross domestic product of US$224.889 billion. The economy has

grown at the rate of 6-7% p.a. over the past few years. More than half of the GDP

belongs to the service sector; nearly half of Bangladeshis are employed in the agriculture

sector, with RMG, fish, vegetables, leather and leather goods, ceramics, rice as other

important produce.

Bangladesh Corporate Tax Rates

The standard rate of corporate tax in Bangladesh is 27.5% in 2008 - 2009 tax

years. This is the standard corporate tax rate applicable to publicly traded




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companies in Bangladesh, a list including tax rates for other corporations are as

follows:

Publicly Traded Company 27.5%

Non-publicly Traded Company 37.5%

Bank, Insurance & Financial Company 45% Mobile Phone Operator Company 45%

If any publicly traded company declares more than 20% dividend, 10% rebate on

total tax is allowed.

Seasonality/Weather Issues

Bangladesh is a country crisscrossed with rivers, and thus uses a wide network of

water-based public transportation. Ferries and other boats compete with the

railroads as a major means of public transport. Typically overloaded and top-

heavy, ferries do capsize, particularly during the monsoon season from May to

October or during unexpected thunderstorms or windstorms. Every year there are

dozens of fatalities resulting from ferry accidents.

Social-cultural factors:

The history of Bangladesh culture is a unique and it is back more than 2500 years ago.

The lives of common people, rivers, land formed a huge heritage more differences than other

regions. The culture of Bangladesh has evolved over a year and it encompasses the culture

diversity to a several social groups. Its culture is composite and over a century has major

influences Jainism, Islam, Buddhism and Hinduism. It is developed in various forms like art and

craft, folklores and folktales, drama, music and dance, festivals and celebrations, philosophy and

religion, languages and literature. Bangladesh is also known as highly populated nation in the

world that there is no island. More than half of the Bangladesh population (98 percent) isBengali, and among 2 percent of people belongs to the tribal and rest of the people are non-

Bengali groups. And it is also estimated about approx. 83 percent of the people are Muslim, and

among 16 percent of people are Hindu, and 1 percent of people are Christian, Buddhist or others.




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The growth rate of annual population of Bangladesh is about 2 percent. The statistical

rate of infant death is about seventy five per one thousand live births. Life expectancy of male

and female is about fifty to eighty years. The annual rate of population was increased by 2.5

percent in 1980s but it decreased by 1.9 percent in 1990s. It has primary language called Bengali

by most nonnatives. The female autonomy is highly influenced by marriage, family and kinship

relationships in the agrarian society of Bangladesh. The division of labor between the sexes is

highly influenced by religion, age, culture norms and practices and political system.

Technological factor

Technological factors for any country can be responsible for reducing the barriers to

entry by reducing minimum proficient production levels. It includes research and development,

technology inducements, computerization etc. Technological change has unbelievable impact in

our every domain of life. These technological revolutions have influence on commerce, service

industries, manufacturing, trade, across the world. Bangladesh is not any exclusion. Bangladesh

is relishing the aids of quota system in terms of RGM. Again the observance to evolving

technology needs them to struggle with the competitor in the international market, meeting the

demand of the high-end users of the garments. Stock market of Bangladesh has once again

grown from the pessimism depression of 1996. Good thing is stakeholder now have more

reliance in Dhaka stock exchange of which is has a computerized trading system. Fundamentally

due to this phenomenon data of trading is accessible on the website stocktaka.com.

Stocktaka.com contains technological analysis indicators as well as fundamental analysis section.

Telecom industry: Unhappily Bangladesh economy is not strong enough that allow its

infrastructure for R & D of large scale.. Bangladesh policies and government process obstruct

firm technological alteration, the telecom companies has in many ways affect and both the

private and public sector to capitalize and convey in new technology such as submarine cables

and WiMaX , even though restrictions have not permitted these technologies to fanfare.




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Legal Factors:

It is very vital to learn the legal system of a country when trading or investing in the

country. The current judicial system in the country goes back to the British rule around two

hundred years back. It has gradually evolved from mixed structure of both Indo-Mughal and

English law.It has traces of both Hindu and Muslim administration.

Corruption and difficult authorized and governing structure are presentlyperceived to be

barriers. The local sellers regard it as the second most vital barrier for growth.The government

has set up Anti-Corruption Commission (ACC).The foreign policy of the nation was focused on

county cooperation. They have established policies for trade by the ministry. There haven’t been

many changes in the policy nearly. The custom tariffs are the main source of income for the

country.

Environmental Factors

According to Mr. M. ZamiulAlam, the Deputy General Manager of BSCIC, the country

is facing some environmental problems in the current year. Agriculture is there is mostly based

on the economy of that region. And the population of the country is affecting of natural

calamities like floods, cyclones etc. Some of the local organizations are there with NGOs to plan

for changing land into forest and still the process is going in early stage of environment




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programme. Another affecting problem is pollution that affects the public and private sector and

they had done a project on Dhaka chamber that tells us awareness about the small and cottage

industries there. For the small cottage industries they need those people who are successful in

setting up business and developed awareness among the people and the environmental sound

technology will slightly change in the country that will help the business people to be beneficial

in general.

conclusion: THE analysis is here shows what is a factor in bagaladesh who realtes to

business, this study is more help for business organization in bagaladesh . I say that PESTLE

analysis is very important in today business world.




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REFERENCES:

Bangladesh Environment - current issues. (2012, january). Retrieved07 12,2012 from

CIA World Factbook: http://www.indexmundi.com/ Bangladesh

/environment_current_issues.html

Global finance . (2012, feb). Retrieved from http://www.gfmag.com/gdp-data-country-

reports/186- -gdp-country-report.html#axzz1ltcQVYUp

Jodie R. Gorrill, M. I. (n.d.). Bangladesh Culture. Retrieved 8 20,2012 from CIA The

World Factbook 2007: http://www.communicaid.com/%5Ccross-cultural-

training%5Cculture-for-business-and-management%5Cdoing-business-in%5C -business-

and-social-culture.php

Bangaladesh industry. (n.d.). Retrieved 08 25, 2012, from edco: www.times of india.com

economictimesbagaladesh(n.d).Retrived0823,2012form

http://economictimes.indiatimes.com/topic/bagaladesh-economi/news




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