[🇧🇩] Bangladesh Export Industries

[Bilal9]

Jute product makers may see good time ahead with government policy​

BTJ Desk Report
12/10/202406
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Bangladesh’s jute and jute goods exports have been declining as buyers increasingly turn to synthetic and regenerated cotton yarn due to high domestic jute prices. The country, the second-largest jute producer globally, heavily depends on exports since domestic demand is insufficient. Export earnings from jute fell 6% year-on-year to $925 million in FY24, continuing a downward trend from $1.16 billion in FY22. In the first quarter of FY25, jute exports dropped by 20% to $178 million, with raw jute exports declining by 31% and jute yarn by 20%.

Several factors contribute to this decline. Rising local jute prices, unhealthy competition among millers, and increased demand for alternatives like polypropylene yarn and regenerated cotton in the global market are key issues. The price surge, driven by reduced jute production (down 18% in FY25) and stoker buying up supplies, has made it difficult for jute mills to remain competitive. Additionally, freight costs and limited domestic jute use further hamper the sector.

Industry stakeholders are urging the government to implement mandatory jute sack usage laws to protect the sector, which employs around four crore people. Many mills have scaled back or halted production due to rising costs and stagnant international prices.

 

[Bilal9]

BIDA creates 'FDI Heatmap' prioritising 19 sectors to boost investment​

Investment

The prioritised sectors include Core apparel, Advanced technical textiles, Renewable energy, Leather, Automotive and parts, Pharma, Plastic, Light engineering, Footwear, Electronics, Semiconductor, Agro-processing, Toy, Medical Devices, EV Battery, Information Technology Specialist (IT-ES), Logistics and Application programming interface (API)

The interesting and informative PDF can be explored here which discusses FDI roadmap priorities according to sector importance,

https://bida.gov.bd/storage/app/media/Press_Heatmap.pdf

 

[Saif]

Bangladesh's export future: education and research is the key

In the globalised economy, the countries that have risen fastest and sustained growth longest are those that embraced exports. The 2008 World Bank Growth Report is unequivocal: countries with outward-oriented policies consistently outperformed those looking inward. For Bangladesh, a country that ha

thefinancialexpress.com.bd

Bangladesh's export future: education and research is the key

M G Quibria
Published :
Jun 03, 2025 23:30
Updated :
Jun 03, 2025 23:30

In the globalised economy, the countries that have risen fastest and sustained growth longest are those that embraced exports. The 2008 World Bank Growth Report is unequivocal: countries with outward-oriented policies consistently outperformed those looking inward. For Bangladesh, a country that has made notable economic strides in recent decades, expanding and diversifying its exports is not just a policy option-it is an economic imperative.

While Bangladesh has made significant strides in its export growth over the past 50 years, there are alarming signs of decline. The export-to-GDP ratio has dropped from 20 per cent in 2010 to about 10 per cent in 2020, indicating a loss of trade competitiveness. This is a critical issue that needs immediate attention, especially when compared to Vietnam's exports, which have surged to seven times that of Bangladesh since the mid-1990s. Our export basket, in particular, remains woefully narrow, underscoring the urgent need for diversification.

Relying heavily on ready-made garments (RMG), which now account for more than 80 per cent of total exports, Bangladesh risks over-dependence on a single sector. Some recent projections by organisations such as Bloomberg Economics suggest that RMG exports are highly vulnerable and might suffer a decline in the coming years. Changing competitiveness is not only possible but also a fact of economic development. Diversification is necessary not only for economic resilience but also for long-term prosperity. To that end, we need both broader production capability and greater market access.

PRODUCTION CAPABILITY: The most significant hurdle here is Bangladesh's outdated and complex tariff structure. With average tariffs at 27 per cent compared to the global average of 5-6 per cent, the structure of tariffs disincentivises exports and encourages inefficient import substitution. This "anti-export bias" needs urgent correction.

Government policies such as cash incentives for exporters have been used to offset this bias. However, these are fiscally unsustainable and clash with World Trade Organization (WTO) rules. Redirecting those funds to underfunded sectors like health and education would yield far greater national benefits.

The pharmaceutical sector serves as a compelling example of Bangladesh's export potential. The country has achieved self-sufficiency in generic drugs and exports to over 100 countries. However, to compete with global leaders like India, the country must transition into high-value segments such as biologics, biosimilars, and digital health. This leap demands serious investment in research and development (R&D) and higher education, the potential payoffs of which are significant.

Expanding into advanced pharmaceuticals is not merely a question of production capacity; it hinges crucially on the development of human capital. Cutting-edge pharmaceutical manufacturing, such as biosimilars or gene therapies, requires highly trained scientists, technicians, and regulatory experts. Establishing first-rate research institutions, fostering collaboration between universities and industry, and incentivising pharmaceutical research will be essential. Moreover, regulatory competence is critical. Developing a robust and transparent regulatory framework for drug approval, quality control, and international compliance requires trained pharmacists, lawyers, and public health experts. Without a well-educated workforce to manage these complex requirements, Bangladesh will struggle to gain international trust and market access for its pharmaceutical exports. As the global pharmaceutical industry becomes increasingly dependent on biotechnology, personalized medicine, and digital health innovations, human capital will determine not just competitiveness but viability.

Unfortunately, Bangladesh's past investment in education has often been insufficient and uneven. Public spending on education has consistently remained below the recommended threshold of 4-6 per cent of gross domestic product (GDP), trailing behind many of its regional peers. Moreover, the quality of education has been a persistent concern-characterised by outdated curricula, inadequate infrastructure, undertrained teachers, and limited focus on STEM (science, technology, engineering, and mathematics) education. While students have stood as vanguards against authoritarianism, successive political regimes have ruthlessly exploited students for political purposes at the cost of their education and welfare. This systemic neglect and exploitation has left the country with a large unemployable labour force, but one that is predominantly low-skilled and ill-prepared for the demands of a knowledge-driven global economy.

To unlock the next stage of export-led growth, Bangladesh must commit to a transformative education agenda. This includes revamping school and university curricula to align with the needs of emerging industries, scaling up vocational and technical training, and building strong links between academia and industry. Special emphasis should be placed on fields critical to export diversification-such as pharmaceutical sciences, data analytics, engineering, and biotechnology. Only by equipping its youth with the skills demanded by modern global markets can Bangladesh truly diversify its export base and achieve sustainable economic resilience.

Another key to boosting production is foreign direct investment (FDI). FDI not only brings capital but integrates a country into global value chains (GVCs). Unfortunately, Bangladesh's poor infrastructure, weak governance, and political instability undermine investor confidence. Geographic proximity to a neighbourhood that is poor and sometimes hostile further complicates matters, making the Vietnam or Mexico model of FDI-led export expansion difficult to replicate.

MARKET ACCESS: Bangladesh currently enjoys generous trade preferences through Generalised System of Preference (GSP) schemes in the European Union (EU), Japan, Canada, and others. However, these benefits will evaporate with the country's graduation from Least Developed Country (LDC) status. Negotiating GSP-plus with the EU could soften the blow, but this, too, requires meeting stringent conditions.

Other options include joining large trade blocs like Regional Comprehensive Economic Partnership (RCEP) or Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). RCEP is more flexible and focused on trade facilitation, while CPTPP demands significant domestic reforms in areas like labor rights, environmental standards, and intellectual property. Policymakers must carefully evaluate the costs and benefits of each.

EXTERNAL CHALLENGE: The external environment is no less challenging. The recent era of United States (US) trade policy-marked by tariff hikes and scepticism of global trade institutions-has left a legacy of economic fragmentation. For Bangladesh, which relies on export markets, any contraction in global trade flows will have outsized effects.

If the world fragments into regional trading blocs or shifts toward greater protectionism, developing countries like Bangladesh risk being squeezed out. Already, signs of such fragmentation are visible, from tariff wars to the weakening of the WTO. The future of global trade is increasingly uncertain.

END NOTE: The future of exports lies not just in goods but in people. Higher-value manufacturing and service exports require an educated, adaptable workforce. As automation and artificial intelligence (AI) reshape industries, unskilled labour will find fewer opportunities. Instead, knowledge-intensive sectors-from IT to finance to digital health-will drive the next wave of growth. This underscores the critical importance of investing in education, vocational training, and digital infrastructure as part of our export strategies.

This makes investments in education, vocational training, and digital infrastructure not just good social policies but export strategies. Without a skilled labour force, Bangladesh cannot compete in the services sector. Service trade has fewer restrictions, and globally, it is growing faster than manufacturing trade.

Bangladesh stands at a crossroads. The gains of the past decades have been remarkable, but they rest on a narrow base. In the future, export success will depend on whether the country can diversify its products, modernise its trade and industrial policies, and invest in human capital. With thoughtful reforms and strategic investments, Bangladesh can become an active player in the global economy.

But the window of opportunity is narrowing. As the global trading system reshapes itself, Bangladesh must act swiftly-or risk being left behind.

Dr M G Quibria is a development economist and former Senior Advisor at the Asian Development Bank Institute. He is a

(non-resident) distinguished fellow at the Policy Research Institute of Bangladesh (PRI) and is the co-editor of the recently published volume The Elgar Companion to the Asian Development Bank. He holds a Ph.D. in economics from Princeton University.​