Foreign investors are demonstrating renewed confidence in Bangladesh’s capital market, driven by a series of regulatory reforms, streamlined investment procedures, and strategic market upgrade initiatives. Total turnover by foreign investors on the Dhaka Stock Exchange (DSE) expanded by 37.6 per cent during the first eight months of 2026 compared to the corresponding period last year.

Data released by the country’s main bourse shows that total turnover by foreign investors reached Tk 3,701.29 crore between January and August 2026. This represents a substantial surge from the Tk 2,687.39 crore recorded during the same period in 2025—an increase of Tk 1,013.89 crore in absolute terms. Notably, the transaction volume in these eight months alone accounts for nearly 94 per cent of the total foreign turnover recorded throughout the entire preceding year, which stood at Tk 3,920.42 crore.

Market insiders attribute this resurgence to several key policy shifts designed to modernize the financial sector. Central to this strategy is the preparation to elevate the capital market’s status from a “Frontier Market” to an “Emerging Market”. Key measures include closer engagement with global index providers such as MSCI, plans to shorten the trade settlement cycle to a T+1 system, and crucial administrative relief provided by Bangladesh Bank regarding the Non-Resident Investors Taka Account (NITA).

Explaining the operational improvements, Nuzhat Anwar, Managing Director of the DSE, highlighted that no single action was responsible for the revival. Instead, a combination of structural preparation and regulatory easing sent a positive signal to international portfolio managers. Previously, foreign fund managers faced cumbersome administrative hurdles where every single transaction through a NITA account required immediate reporting and reconciliation. Following recommendations from the DSE, the central bank simplified the framework, permitting foreign investors to complete necessary accounting procedures upon the final repatriation of funds rather than per transaction. This adjustment significantly reduced trade friction and lowered transaction delays.

Trading activity throughout 2026 exhibited notable fluctuations while maintaining a broader upward trajectory. The year opened with a foreign turnover of Tk 377.24 crore in January, climbing sharply to Tk 663.28 crore in February. Activity dipped through March (Tk 272.04 crore) and April (Tk 175.16 crore) before hitting a peak in May at Tk 831.70 crore—the highest monthly total in the eight-month period. Transaction figures moderated slightly over the summer months, recording Tk 540.17 crore in June, Tk 523.15 crore in July, and Tk 318.57 crore in August.

In contrast, monthly figures from the previous year revealed a comparatively muted profile. Turnover stood at Tk 181.81 crore in January 2025, Tk 264.14 crore in February, and Tk 171.96 crore in March. Although trading gathered momentum in April (Tk 426.94 crore) and peaked for that period in May (Tk 506.74 crore), turnover cooled to Tk 285.31 crore in June, Tk 491.44 crore in July, and Tk 371.56 crore in August.

To illustrate the monthly trajectory across both years, the comparative figures are detailed below:

The easing of bureaucratic bottlenecks alongside ongoing infrastructure upgrades positions the DSE to capture greater international portfolio flows as market reforms continue to take