Korea also expressed interest in investing in Bangladesh's energy and infrastructure sectors on the back of last week's government decision to award operating licence to the $1 billion Korean Export Processing Zone (KEPZ).

Dhaka also backed South Korea to host the 2014 Asian Games in March, sources say.

Foreign and Expatriates' Welfare Adviser Iftekhar A Chowdhury, currently in South Korea, is set to meet a legion of South Korean investors, including massive conglomerates Youngone and Daewon, to explore investment in these sectors.

The manpower MoU institutes the new Employment Permit System (EPS), a long held demand of Dhaka not met due to Seoul's reservations over a large number of undocumented Bangladeshi workers and the last BNP-led coalition government's reluctance to give the go ahead to KEPZ, sources say.

The reluctance to award the KEPZ licence and failure of the immediate past government to rein in over-charging recruitment agencies, dampened Dhaka-Soul relations that has been rejuvenated in the last few months, sources say.

The MoU was signed by Iftekhar and Korean Labour Minister Lee Sang-Soo. Iftekhar later said, "Bangladesh has the supply and Korea has the need. It is a matter of adjusting the two, which will be for our great mutual benefit."

Initially, the recruitment will focus on textile, manufacturing, construction, service-sector, and agriculture.

South Korea has not taken in Bangladeshi workers since 2003 as a large number overstayed their visas to earn back the exorbitant amounts of money they had paid to local recruiting agencies to be in South Korea, sources said.

However, the MoU does not allow for a process to legalise 12,000 undocumented Bangladeshi workers to remain in South Korea. But it includes a clause for preferential treatment for these workers, if they return voluntarily, to receive legal permits to re-enter South Korea under the EPS.

A number of manpower exporters said it is logical that the South Korean government should consider keeping the undocumented workers there and allow them to meet the demand for textile workers, which is currently 50,000.

Recently, the United Arab Emirates (UAE) Labour Minister Ali bin Abdullah Al Kaabi said they would consider a legalisation process for undocumented Bangladeshi workers there to supplement the new legal workers under another MoU signed between Bangladesah and the UAE.

Sources said although Bangladesh is competing with three other countries to export workers to South Korea under the EPS, government facilities, and local workers' language and technical skills give them a significant comparative advantage over workers from the three other countries -- Nepal, Kyrgyzstan and East Timor.

Meanwhile, former secretary general of Bangladesh Association of International Recruiting Agencies Ali Haider Chowdhury welcomed the EPS agreement saying that a legal framework for government-to-government manpower export opens up more windows for Bangladeshi workers.

Iftekhar said, "The MoU will open up great potentials for Bangladeshi workers to come and work legally in South Korea…We are planning to upgrade skills of our workers including in the Korean language in response to Korean demands."

Earlier, in Seoul, Iftekhar met his counterpart Song Min-soon on the sidelines of the 6th Asian Cooperation Dialogue Ministerial Meeting. Song thanked Bangladesh for awarding the KEPZ licence and expressed interest in energy and infrastructure sectors, said a foreign ministry press release.

Iftekhar also met Japanese Senior Vice Minister for Foreign Affairs Katsuhito Asano, where he praised the caretaker government's reform initiatives and assured Iftekhar of Japanese assistance in this regard.

They identified a number of areas for close cooperation, including in infrastructure, water, energy and communications sectors.

Japan also sought Bangladesh's support in the United Nations on a number of issues. The foreign adviser assured that Tokyo 'would receive the most favorable considerations'.

Iftekhar also called on South Korean President Roh Moo-Hyun.

The adviser is presently leading Bangladesh delegation to the ministerial meeting.

He also had a meeting with representatives of Bangladeshi community in Korea at the country's embassy. "We will make our best efforts to protect the interest of all Bangladeshis in Korea", he told the gathering. He advised all Bangladeshis to uphold the image of their country.