[🇧🇩] Textile & RMG Industry of Bangladesh

[Saif]

Unrest in the RMG sector and harm to the economy

Bangladesh's reputation has been harmed as a brand in the outside world. Factories are being shut down due to the political unrest and labour demands

en.prothomalo.com

Unrest in the RMG sector and harm to the economy
Ashfaq Ahmed
Published: 18 Oct 2024, 14: 50

At an RMG factory Prothom Alo

The readymade garment sector is one of the major driving forces of Bangladesh's economy. This export-oriented sector is contributing to the GDP as well as generating employment.

According to the World Trade Organisation (WTO)'s report, 'World Trade Statistics 2023: The Insights and Trends', in 2023 Bangladesh remained at the second top place globally in readymade garment (RMG) exports, as in 2022. Exporting RMG less than Bangladesh by 7 billion dollars, Vietnam ranks third. And at the top place, as always, is China.

According to the WTO report, Bangladesh exported RMG worth 38 billion dollars (3,800 crore dollars) worth of readymade garments last year. In 2023 Bangladesh’s share of the global RMG market was 7.38 per cent. The year before, that is 2022, the volume of RMG exports totaled 45 billion dollars (4,500 crore dollars).

However, political unrest, the fall of the government and the recent labour unrest has created concern that a large chunk of the work orders may be diverted to other countries. This is being viewed as a potential crisis for this export sector.

If factories are closed, unemployment will mount, leading to further unrest. The office of the chief advisor has assured that the situation is under control. However, apprehensions persist that the miscreants may instigate trouble at any time

Down the years, Bangladesh’s RMG sector has steadily advanced to reach this position. All those involved in this sector have toiled tirelessly for the development and expansion of this industry. However, it has been noted that since the fall of the last government there have been certain efforts to disrupt the sector.

After the change in political landscape, labour unrest has emerged in Savar and Ashulia of Dhaka, Kaliakoir of Gazipur, Araihazar of Narayanganj and other industrial belts. Certain vested quarters are trying to use this unrest in their own interests.

Several reasons behind the labour unrest in the country’s RMG sector are coming to the fore. There is the conflict over the ‘jhut’ (waste fabric) trade, ownership problems, outstanding dues, instigation by outsiders and certain new demands being raised by the workers.

A look at the unrest in the RMG sector over the past one month will reveal that after the political changeover, the leaders and activists of various parties have begun to assert themselves. This has appeared in reports of a leading newspaper of the country too.

Even a large party like BNP has taken action against these elements following the allegations. The report mentions that certain names of the party’s leaders too, though action remains pending. One of the accused persons even reportedly demanded benefits from the export-oriented Fakir Group in Narayanganj.

If a look is taken at the problems that have befallen the RMG sector till mid-August, it will be seen that the RMG factories, textile mills and even spinning mills have been under lock and key.

Later, after acquiescing to extortion, these factories were restarted. Only when promised to be paid “toll”, did a group of these activists, under political shelter, reopen the locks of around 57 establishments in Narayanganj’s Araihazar, Satgram, Gopaldi and Duptara. Many of the accused have been expelled from the party.

Concerning these errant BNP men who have been using the party’s name, BNP’s senior joint secretary general Ruhul Kabir Rizvi has said, “I request all persons including the concerned establishments to be alert concerning such motivated aggression. These people do not represent BNP.”

It must be understood that after the mass uprising, a constructive mindset has emerged among the people of Bangladesh. The national elections will be held. The political parties like BNP need to undergo reforms to tally with the mindset of the people and only then can they be totally ensured of the people’s mandate.

No establishment gathers strength on its own. There are thousands of workers and international brands involved. Production worth millions of taka and the supply chain of the RMG and other industries and sectors, are involved too. If cases and attacks continue on political considerations in this manner, what message will this deliver to our buyers abroad! Who is benefitting from this unrest? It is for the government to find out. The government and all concerned quarters must pay attention to these signs and speedily find a solution.

The situation is gradually improving, but it will take time to fully recover. Former president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Rubana Huq, recently told the media, the two-week closure has caused harm to the industry. But the biggest harm is that our buyers are moving elsewhere. The fact is within December, 25 to 30 per cent of the orders will move away. Bangladesh National Labour Federation's general secretary Marium Akhter feels that outsiders are behind the worker unrest. It is still unclear when this promising sector will be fully functional again.

Bangladesh's reputation has been harmed considerably as a brand in the outside world. The factories are being shut down due to the political unrest and labour demands. Production has been hampered. In the meantime, new orders in the RMG sector are being diverted to Vietnam, India, Myanmar and other such countries.

A recent report quoting figures from the US Department of Commerce's Office of Textiles and Apparel (OTEXA), said that in the eight months from January to August, Bangladesh exported readymade garments worth 4.71 billion (471 crore US dollars) In the corresponding period last year 7.29 billion US dollars of readymade garments were exported. Presently Bangladesh is the third highest exporter of readymade garments to the US.

Bangladesh at present faces serious economic damage. Money has been laundered in huge sums, banks have been riddled with uncontrolled corruption, inflation has spiralled and there has also been a spate of natural calamities, all contributing to pushing the economy to the brink.

At this juncture, if the readymade garment industry is chucked into dire straits, the entire country's economy will be harmed. If factories are closed, unemployment will mount, leading to further unrest. The office of the chief advisor has assured that the situation is under control. However, apprehensions persist that the miscreants may instigate trouble at any time.

* Ashfaq Ahmed is a journalist and writer​

 

[Saif]

RMG work orders returning as labour unrest subsides

After more than a month of disruption due to the political changeover and subsequent labour unrest in major industrial belts, international apparel retailers and brands are returning to Bangladesh with work orders for upcoming seasons.

www.thedailystar.net

RMG work orders returning as labour unrest subsides

After more than a month of disruption due to the political changeover and subsequent labour unrest in major industrial belts, international apparel retailers and brands are returning to Bangladesh with work orders for upcoming seasons.

Local garment suppliers said more Western retailers and brands are now visiting the factories and inquiring about production as normalcy has returned to the sector.

They said Western buyers are placing orders for the next autumn and winter seasons.

"I haven't noticed any major challenges in the inflow of work orders for the upcoming seasons," said Kutubuddin Ahmed, chairman of Envoy Legacy. "They haven't shifted orders away from here."

However, many factories are facing increased costs for having to make air shipments due to production delays caused by the unrest, Ahmed added.

He said a stable production environment is crucial for both suppliers and retailers.

During the unrest in September and early October, apparel factories in major industrial hubs were shuttered. Consequently, some summer orders have already been relocated to Bangladesh's rivals.

On top of the lost production and missed work orders for small and medium-sized factories, Ahmed said manufacturers are struggling as some banks are unable to open letters of credit (LCs) due to a liquidity crisis, US dollar shortage and reduced loan repayment capability of their clients.

Requesting anonymity, a major European buyer said their company did not shift any work orders out of Bangladesh due to the unrest.

"Production facilities are improving but uncertainty remains and our headquarters is concerned about the factories that were affected by the labour unrest," the buyer said.

Although buyers do not plan to reduce order quantities, overall volumes may not reach previous levels as any unrest has some negative consequences, he added.

"I have been meeting with buyers to assure them that normalcy has returned to the industrial zones and factories have resumed production," said Kalpan Hossain, managing director of Dekko Legacy Group.

Hossain's factories were shut down for 23 days in September and five days in October. This translated into a daily production loss of 80,000 pieces of trousers and jackets, valued at $4.8 lakh.

"Buyers want stability as they also need to ensure timely shipment of goods and profit," he said.

If a stable business and political environment continues, it is expected that upcoming seasons will be good for business, Hossain added.

"None of my buyers have shifted work orders so far," said Sharif Zahir, managing director of Ananta Group.

Zahir said he is hopeful that the upcoming seasons will be good as buyers are placing a significant number of orders now that normalcy has been restored.

The labour unrest was largely centred at manufacturing hubs around Dhaka. As a result, production at garment factories located in other areas was quite unscathed.

"I have work orders for the next seasons as the environment was relatively peaceful in Chattogram compared to other industrial zones in Dhaka," said Vidiya Amrit Khan, deputy managing director of Desh Group.

To sustain buyers' confidence, she said maintaining stability and a normal business environment are very important.

Requesting anonymity, a garment manufacturer from Rupganj upazila in Narayanganj said buyers are demanding discounts for their products due to shipment delays.

Apart from political stability and tight competitiveness, there are other challenges at the home front facing apparel manufacturers and textile millers. These include consistent gas and power supplies.

Khorshed Alam, chairman of Little Group, said his yarn production has declined 50 percent due to gas shortages and load shedding.

His Ashulia-based mill usually produces 24,000 pounds of yarn daily, but is now slumping to 12,000 pounds.

According to Alam, while the demand for yarn is increasing with the resurgence of garment work orders, inadequate gas supply remains a major obstacle.

Kyaw Sein Thay Dolly, managing director of Cloths R Us, said the labour unrest particularly hurt small and medium enterprises.

"Now both we and the buyers want to be optimistic," she said.

Khandoker Rafiqul Islam, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said the unrest impacted autumn garment production.

He said the BGMEA will hold a meeting with representatives of international retailers and brands next week to reassure them of the restored business environment and the association's commitment to meeting deadlines.​

 

[Saif]

Garment industry lost $400m to worker unrest

The garment industry of Bangladesh has suffered collective production losses of nearly $400 million due to a series of labour unrest in September and early October, exporters said.

www.thedailystar.net

Garment industry lost $400m to worker unrest
BGMEA says

The garment industry of Bangladesh has suffered collective production losses of nearly $400 million due to a series of labour unrest in September and early October, exporters said.

However, the industry has now regained stability as the labour situation in major industrial belts improved, according to Khandoker Rafiqul Islam, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

He made this remark during a press conference at the BGMEA office in Dhaka yesterday.

Islam highlighted that maintaining law and order alongside discipline is now the major challenge for the garment industry as factories are currently operating as usual.

Also, the BGMEA chief urged the interim government to allow the use of gas from CNG refuelling stations as industrial units are not getting an adequate supply of the fuel.

Over the past few years, many garment and textile units have been using compressed natural gas (CNG) purchased from refuelling stations to power production equipment as they are not getting enough supply from government pipelines.

Furthermore, Islam asked the authorities not to disconnect factories from utility services, such as gas or electricity, for failing to pay bills for the next three months as most of them were affected by the labour unrest.

Additionally, he sought government intervention to lower bank interest rates to a single digit and suggested that a joint security force led by the army should be formed to ensure safety at the garment industrial belts.

Other requests placed by the BGMEA included allocating interest-free bank loans for 39 manufacturing units based in Ashulia that were unable to pay their workers' wages for September amid the unrest.

In regard to improving the ease of doing business, Islam sought the interim government's cooperation in expediting the loading and unloading activities at Chattogram port.

The BGMEA chief also urged to ensure that none of the reform or punitive measures for certain sectors, companies or individuals end up adversely impacting industrial operations in the country.

The interim government recently formed a taskforce involving officials of the Bangladesh Bank and National Board of Revenue to create a more business friendly environment.

Besides, the formulation of a sustainable power policy, which includes fixing a rational price for electricity and ensuring its adequate supply, is needed, he said.

The BGMEA's charter of demands included keeping the recycling of waste fabric, locally known as jhut, and other garment products away from the outside influence by formulating a separate policy.

Shams Mahmud, a director of the platform for apparel makers and exporters, said the BGMEA is continually engaging with foreign stakeholders to attract them more.

"We are constantly updating our partners and different brands on the evolving situation," he said. As a part of the dialogue, the BGMEA will be meeting with the American Apparel & Footwear Association, which represents over 1000 brands from the US.

"We will update them about the current situation," Mahmud added.

Abdullah Hil Rakib, senior vice president of the BGMEA, said they have asked the chief adviser to lobby the US for lowering the tariff on garment shipments as the Western nation has suspended its trade benefits under the Generalised System of Preferences (GSP) for all countries.​

 

[Saif]

Unrest erodes Bangladesh’s RMG edge over rivals

Garment exports by Bangladesh’s market rivals like India, Vietnam, China and Cambodia have increased to major Western markets due mainly to the latest spell of labour unrest and political changeover earlier in August in the country.

www.thedailystar.net

Unrest erodes Bangladesh’s RMG edge over rivals

Garment exports by Bangladesh's market rivals like India, Vietnam, China and Cambodia have increased to major Western markets due mainly to the latest spell of labour unrest and political changeover earlier in August in the country.

In September, India's readymade garment (RMG) exports grew by 17.3 percent year-on-year, capitalising on political instability in Bangladesh, according to Indian daily The Telegraph.

The growth comes despite global challenges such as inflation and supply chain disruptions, which have impacted other major garment-exporting nations, the report states.

"India's RMG exports have recorded high growth despite global headwinds and inflationary pressures," said Sudhir Sekhri, chairman of the Apparel Export Promotion Council.

"Many leading apparel exporters have experienced a slowdown in recent months, but India has benefitted from Bangladesh's socio-political unrest," he added.

Bangladesh's internal turmoil forced some factories to close temporarily, causing delays in delivery schedules.

Referring to India's CareRatings, The Telegraph also said if the unrest continues for more than one or two quarters, Bangladeshi exporters could face significant challenges in meeting deadlines.

In the July-September period of the current fiscal year, Bangladesh's garment export grew 5.3 percent year on year to $9.28 billion, according to the Export Promotion Bureau (EPB).

Despite the EPB's growth count, apparel exports in the first eight months of 2024 to the US and European Union (EU) were not encouraging compared to Bangladesh's market competitors.

For instance, garment export to the USA, the country's main export destination, fell by 9.16 percent year-on-year to $4.70 billion in the January-August period of the current year, according to data from the Office of Textiles and Apparel (OTEXA).

OTEXA attributed the fall to slumping demand for apparels in the American market.

In combined, the textile and garment shipment from Bangladesh to the USA also fell by 8.98 percent year-on-year to $4.84 billion in the January-August period this year, showed the OTEXA data.

Bangladesh's competitors performed well in the USA and EU markets as data showed that their exports, in terms of quantity, increased. The countries also took the advantage of the rebounding US economy, as consumer spending on retail goods, including apparel items, increased.

The retail sales in the US increased again in September as employment grew and inflation and interest rates fell, said Jack Kleinhenz, chief economist of the National Retail Federation (NRF), the world's largest retail trade association.

In the January-August period, the quantity of apparel imported by the USA increased by 1.5 percent year-on-year, while Bangladesh's export declined by 3.8 percent in terms of quantity.

During the period, US apparel sourcing from China increased by 3.6 percent in terms of quantity.

Apparel exports to the USA by Vietnam during this period increased by 5.2 percent, from India by 7.6 percent and from Cambodia increased by 7.7 percent, according to OTEXA data compiled by the BGMEA.

Similarly, in the January-July period, garment imports by the EU countries increased by 3.3 percent and the growth was only 2.8 percent from Bangladesh, according to Eurostat data compiled by the BGMEA.

During this period, apparel export to the EU by China grew by 6.4 percent, from India at 5.18 percent, from Cambodia at 18.35 percent, from Vietnam at 12.61 percent and from Pakistan by 14.41 percent, showed the data.

Overall in the July-September period, garment export from Bangladesh grew by 5.34 percent, whereas Vietnam recorded the overall apparel export growth at 15.57 percent and India at 13.45 percent, the BGMEA compiled data showed.

The data analysis showed that the garment exports by other countries grew faster than Bangladesh in the major markets largely because of the political and labour unrest.

The local garment exporters could not produce goods smoothly and ship those on time.

Exporters said some of the international retailers and brands either suspended their factory visit or shifted work orders to other countries.

A good number of garment factories have witnessed on and off situations since the beginning of the anti-discriminatory student movement in mid-July this year.

AK Azad, chairman and managing director of Ha-Meem Group, which mainly exports to the USA, said he experienced labour unrest and his export was affected like others.

"However, now I have been booking a lot of work orders from the buyer as they are coming back for the next seasons," Azad said.

Ex-president of now dissolved Bangladesh Garment Manufacturers and Exporters Association (BGMEA) Khandoker Rafiqul Islam also echoed Azad, saying, "Buyers are coming back now as the normalcy has restored in the sector."​

 

[Saif]

CEMS-Global USA to host Textile Series of Exhibitions in Dhaka

CEMS-Global USA, a New York-based multinational exhibition and convention organiser, on Monday announced that it would host Bangladeshi edition of its globally renowned Textile Series of Exhibitions.

www.newagebd.net

CEMS-Global USA to host Textile Series of Exhibitions in Dhaka
Staff Correspondent 21 October, 2024, 22:47

CEMS-Global USA, a New York-based multinational exhibition and convention organiser, on Monday announced that it would host Bangladeshi edition of its globally renowned Textile Series of Exhibitions.

The 23rd edition of the Textile Series of Exhibition will be held from November 6 to 9 at the Bangladesh-China Friendship Exhibition Centre in the capital Dhaka and it will remain open from 10.00am to 7.00pm. It will comprise three international expos that will serve as vital platforms for textile and garment industry.

The company provided the details about the exhibition at a press conference held at a hotel in the city on Monday.

Meherun N Islam, president and group managing director of CEMS-Global USA and Asia-Pacific, said, ‘In the past, entrepreneurs of the garment and textile sectors of Bangladesh used to go to various exhibitions abroad to know about necessary products and raw materials. Now they will be able to save money, labour and time through this exhibition.’

SS Sarwar, group chief executive officer of CEMS-Global, said that amid the current situation, this exhibition would be of special importance and if it succeeded, Bangladesh would have a more positive image internationally.

Organisers said that the Textile Series of Exhibitions was already playing a major role in the advancement of South Asian ready-made garments and textile industries.

More than 1,475 companies from 37 countries are expected to participate in more than 2,245 booths in all three of the exhibitions.​

 

[Saif]

Loss to RMG industry

Before his exit from the post of president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) on Sunday, Khandoker Rafiqul Islam claimed that normalcy has returned to the apparel sector but at a huge cost. According to him, the industry lost $400 million in more than a month-

thefinancialexpress.com.bd

Loss to RMG industry
FE
Published :
Oct 21, 2024 21:53
Updated :
Oct 21, 2024 21:53

Before his exit from the post of president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) on Sunday, Khandoker Rafiqul Islam claimed that normalcy has returned to the apparel sector but at a huge cost. According to him, the industry lost $400 million in more than a month-long industrial unrest, which has yet to be confirmed by any independent statistical body. If the figure of loss is anywhere near the given sum, it raises more questions than can be answered. In 2023, the readymade garment (RMG) sector fetched $47.38 billion, a record high, and the apex apparel body did not do enough to settle some of the endemic issues souring the industry's labour relations. The fact that the garment owners in the RMG belt most affected by the unrest ultimately accepted all the 18 demands of their workers is a proof that the latter's demands were reasonable and justified. Then why did they allow the situation to escalate to an ugly disruptive level?

Clearly, the inflexible garment owners have none but only themselves to blame. Significantly, garment factories managed well and have been offering reasonable wages to their workers stayed free from the industry's turmoil. It is the ones which were reluctant to give a fair share of the profit to workers have been responsible for leaving their employees and even themselves a casualty of the industrial disruption. The loss has been double-pronged---financial and labour relations. Their litany of infiltration of outsiders for provoking agitation was more a ploy than a reality. That the BGMEA failed to exercise a sobering influence leading to a solution to the problem is clear from the internal feud that has made one group to level charges against another and the vice versa. Finally, an administrator has been appointed to oversee the next election to the body.

The just departed BGMEA president made an appeal to the government to enforce strict law and order in the interest of the sector's stability. This is intriguing if not ludicrous. If workers are not paid their outstanding dues and cleared off their overtime and other benefits on time, the low-paid workers find it difficult to keep their body and soul together in an extremely hostile and volatile market condition. It is the industrial relations, not the army or the law-enforcement agencies, that determine peace, harmony and increased productivity in any industry. Deprived and exploited labour forces are the last to put in their hundred per cent in their performance.

There is a need for a paradigm shift in the mentality of management and owners, particularly at a time when the rallying call for narrowing social discrimination by students who spearheaded the recent movement is gaining momentum, in favour of a fair share of profit with workers. Many garment factories have been doing so and the others should follow suit. The apparel industry has received incentive packages for long and it is asking for more for the factories adversely affected by the recent labour unrest. Well, the appointment of an administrator and formation of neutral board under him speaks volumes for the discord within the industry. Patronage cannot be doled out without accountability. The need is to subject ailing factories' financial audits to stringent inspection before granting loan or stimulus packages.​

 

[Saif]

RMG units struggle to adopt global reporting standards

Local garment factories are struggling to implement the Global Reporting Initiatives (GRI) standards, a set of 246 globally accepted standard issues, owing to a raft of factors, including a lack of data, local expertise, national policy directives and incentives, according to a keynote paper...

www.thedailystar.net

RMG units struggle to adopt global reporting standards
Keynote paper blames a lack of data, expertise

Experts attend a roundtable on “Implementing GRI in the RMG Sector of Bangladesh”, jointly organised by The Daily Star and Swisscontact at The Daily Star Centre in Dhaka yesterday. Photo: Star

Local garment factories are struggling to implement the Global Reporting Initiatives (GRI) standards, a set of 246 globally accepted standard issues, owing to a raft of factors, including a lack of data, local expertise, national policy directives and incentives, according to a keynote paper presented yesterday.

The GRI standards represent global best practices for reporting publicly on a range of environmental, social and governance (ESG) impacts.

But so far, only 33 local garment factories have implemented GRI standards for reporting.

The paper also said that 66 percent of global consumers, including 73 percent of millennials, are willing to pay more for sustainable goods.

By 2026, ESG-related assets under management (AuM) are expected to increase to $33.9 trillion, which would account for over one-fifth of total global AuM.

Even more importantly, the EU Sustainability Reporting Standard (ESRS) will be enforced by 2026, said Mohammad Monowar Hossain, head of sustainability at Team Group, while presenting the paper at a roundtable on "Implementing GRI in the RMG Sector of Bangladesh."

The discussion was jointly organised by The Daily Star and Swisscontact at The Daily Star Centre in Dhaka yesterday. Tanjim Ferdous, in-charge (NGOs and foreign missions) of The Daily Star, moderated the roundtable, which featured experts, exporters, professionals, entrepreneurs and officials of different diplomatic missions.

Asif Ashraf, managing director of Urmi Garments Ltd, said the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) was the first trade body in the country that had helped its members implement GRI standards in their factories.

However, many small and medium enterprises do not have the financial capabilities or human resources to implement the standards, he said.

"International retailers and brands are not ready to pay higher prices, but every such initiative costs money," Ashraf added.

Melita Mehjabeen, a professor at the Institute of Business Administration of the University of Dhaka, said GRI standards also need to be implemented in sectors such as steel.

She added that a number of companies did not have an adequate understanding of GRI standards.

Md Akhter Hossain Apurbo, vice-president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said local exporters are eager to learn how to increase trade while adhering to rules and regulations.

However, Apurbo added that Bangladesh's graduation from the group of least developed countries to a developing nation in 2026 may pose a challenge because of the erosion of trade preference that the country enjoys given its current status.

Mohammad Rashed, another vice-president of the BKMEA, said huge costs are associated with the implementation of such initiatives.

"Moreover, different buyers raise different compliance issues. But many small and medium enterprises do not have the capability to implement those rules and become more compliant."

Michael Klode, project manager at the Programme for Sustainability in the Textile and Leather Sector of the GIZ, identified the unavailability of data as another barrier to the implementation of GRI standards, saying it is sometimes difficult to know what is happening in factories.

Khondaker Golam Moazzem, research director at the Centre for Policy Dialogue (CPD), said global partnerships and new rules and laws were on the horizon and that the country would have to adapt.

Although Bangladesh is still struggling with social challenges, environmental issues are being given increasing importance, he added.

"Social issues like human rights and labour rights should not be sidelined," he said, pointing to progress in occupational safety and workers' health and nutritional issues.

He also highlighted the lack of functional trade unions and said it is important to comply with international financial reporting standards.

Thijs Woudstra, deputy head of mission at the Embassy of the Kingdom of the Netherlands, appreciated that Bangladesh has the highest number of green garment factories in the world despite facing a lot of setbacks.

GRI is a more data-driven initiative, he said, adding that a country should be able to address these issues.

"ILO's fundamental principles and rights at work guarantee fair and decent working conditions for all. These principles are at the core of the social reporting framework. Bangladesh's garment industry can lead the advocacy effort for a single framework on sustainability reporting," said Anis Nugroho, programme manager of Better Work.

He added that Better Work has been working with 100 global retailers and brands and 470 garment factories in Bangladesh.

Zahedul Hoque, managing director of Kido BD, said the country was moving in the right direction in terms of compliance, but also acknowledged challenges.

"We have to develop by ourselves," Hoque said.

Ainee Islam, programme director at Asia Foundation, said they launched a programme named Oporajita for female garment workers in Bangladesh.

Mohammad Abdullah Yousuf Khan, programme manager at Solidaridad Network, said transparency in the whole supply chain is very important. Transparency will improve buyer confidence and suppliers can get a premium, he said.

Ikramul H Sohel, senior programme officer, market development cooperation section, Swedish International Development Cooperation Agency, said there are many requirements for implementing GRI standards. Skilled manpower is also needed, he added.

Sadril Shahjahan, senior research associate of the Centre for Entrepreneurship Development at BRAC University, said there should be a data repository for the garment sector.

It is required because it will allow those who wish to comply with and adopt GRI initiatives to learn more about it and understand the challenges, he said.

Tanzila Tajreen, senior policy adviser at the Embassy of the Kingdom of the Netherlands, said Bangladesh still has a long way to go as only 33 factories have implemented GRI standards.

"Is this an extra burden for the factories?" she asked.

Ishrat Fatema, team leader at Swisscontact, said they have multiple projects in the garment sector and some will be coming soon.

Mujibul Cezanne Hasan, country director at Swisscontact, said GRI standards are quickly becoming a requirement. It has associated costs but should be treated like an investment, Hasan said.

Sahela Akter, deputy secretary to the Ministry of Industry, also spoke.​

 

[Saif]

Meeting $100b garment export target by 2030 tough, but feasible

Bangladesh’s ambitious $100 billion garment export target by 2030 is currently facing a number of challenges both at home and abroad, but local manufacturers and business leaders are still optimistic about achieving the goal.

www.thedailystar.net

Meeting $100b garment export target by 2030 tough, but feasible
Say manufacturers, business leaders

Bangladesh's ambitious $100 billion garment export target by 2030 is currently facing a number of challenges both at home and abroad, but local manufacturers and business leaders are still optimistic about achieving the goal.

To meet the target, readymade garment exporters seek government policy support, a stable political environment and overall security for their production units.

In fiscal year 2023-24, Bangladesh, the second largest apparel exporter of the world, shipped readymade garments worth over $36 billion.

Now domestic challenges facing manufacturers include a poor business and investment climate, disruptions to production and shipments and shortages of gas and power for production lines.

These issues are compounded by global inflationary pressures and declining prices for apparel items in key markets.

Moreover, the country's scheduled graduation from the least developed country club in 2026 will strip away preferential market access facilities for Bangladeshi RMG items, estimated at $7.77 billion by the World Trade Organization (WTO).

"Buyers are returning to Bangladesh. Therefore, achieving the target is possible if the government can improve gas and power supply," said Faruque Hassan, former president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

During his tenure at the BGMEA, Hassan set the export target in 2022. To achieve this goal, the BGMEA then identified adequate gas and power supply, new investment, product and market diversification and investment in man-made fibre products as crucial factors.

However, current political uncertainties have compounded the existing energy situation and increased production costs.

Hassan said that with adequate gas and electricity supply, fresh investment would flow into the sector and many entrepreneurs would invest or expand their operations in high-value-added garment items like man-made fibre garments, jackets, activewear, jerseys, skiwear and sports items.

This value addition, he said, would fetch higher prices compared to traditional basic item exports.

On an optimistic note, he said Bangladesh's exports to non-traditional markets such as Japan, India, Russia, South Korea, South Africa and Australia appear promising.

"If exports continue at the current pace to these markets, along with traditional markets like the USA, Canada and the European Union (EU), it is possible to achieve the target," added Hassan, also the managing director of Giant Group.

The former BGMEA president also said that international retailers and brands have solid confidence in Bangladesh due to improvements in workplace safety and labour rights after the Rana Plaza garment collapse in 2013.

Moreover, he mentioned that China has been losing its global market share. Consequently, apparel work orders are coming to Bangladesh not only from China but also from Pakistan, Myanmar, Ethiopia and Sri Lanka due to political tensions in those countries.

Similar to Hassan, Kalpan Hossain, managing director of Dekko Legacy Group, said non-traditional markets, along with traditional ones, will be key drivers in achieving the target. Besides, he said Latin American countries could be excellent destinations for Bangladesh's apparel shipments.

"Achieving the target will be challenging, but it is still possible," said Hossain. "We have the potential and we must utilise it."

Shams Mahmud, managing director of Shasha Denims, said the country's garment exports have steadily increased over the past decade.

"Therefore, garment exports may grow at an even higher rate in the next six years, provided the sector gets adequate gas supply, financial support, government policy support, political stability and industrial security," he said.

Khandoker Rafiqul Islam, president of the now-dissolved board of directors of BGMEA, also sounded confident in achieving the $100 billion garment export target by 2030, provided all necessary facilities are in place.

With adequate gas supply, he said many companies would expand or invest in new ventures.

However, Mohammad Abdur Razzaque, chairman of the Research and Policy Integration for Development (RAPID), expressed a different view on achieving the target on time.

"When the target was set, the country's business environment was different and it has now changed," Razzaque said. "With the current business environment, achieving $100 billion might be challenging, but the country may reach $70 billion-$80 billion if a better business environment is ensured."

He added that a global slump in demand for clothing items, coupled with domestic challenges, is making the target difficult.

Razzaque also talked about the possibility of higher tariffs on Chinese items imposed by the USA if the Republican Party wins the next election. He believes this could divert massive work orders to Bangladesh from China.​

 

[Saif]

We must revitalise the home textile sector

Ensure adequate gas supply, resolve dollar crisis

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We must revitalise the home textile sector
Ensure adequate gas supply, resolve dollar crisis

We are concerned about the current state of the home textile sector that has been struggling to regain its lost work orders over the past two years. Reportedly, due to the doubling of gas prices in Bangladesh and a significant devaluation of the Pakistani rupee against the US dollar, many work orders shifted to Pakistan. This shift, combined with a prolonged gas crisis, unstable exchange rates, and rising production costs, has forced numerous factories to shut down, further eroding the sector's competitive edge in the export market. Recent labour unrest and ongoing political instability in the country have worsened the situation further. If these issues are not addressed, the home textile sector will continue to incur losses in the future.

It may be recalled that this sector had experienced notable growth in 2021, with exports surpassing the $1 billion mark, registering a remarkable 49.17 percent year-on-year increase. That momentum carried over into 2022, with exports rising by another 40-odd percent to $1.62 billion. However, as the gas crisis intensified, home textile exports—including bedsheets, tents, rugs, etc—dropped, with earnings falling to $1.09 billion. In FY 2023-24, exports further declined by 2.05 percent to $851.01 million, according to the Export Promotion Bureau (EPB). Industry insiders attribute this downturn to the persistent gas crisis that began in early 2023, following the then government's 150.41 percent hike in gas prices, from Tk 11.98 per unit to Tk 30 per unit. With soaring production costs, many exporters were unable to secure new orders, leading to a shift of international business to Pakistan.

To revitalise the sector, the government must prioritise uninterrupted gas supply to home textile mills so that they can operate at full capacity. As home textile production relies heavily on gas for processes like running steam boilers and dyeing fabrics, the sector's energy needs cannot be sustainably met by imported gas alone. It is crucial, therefore, for the government to explore and develop domestic gas fields rather than relying solely on imports. Unlike Pakistan, which produces much of its own raw materials, Bangladesh depends on external markets, making the ongoing dollar crisis an additional hurdle. That needs to be resolved, too.

We urge the government to take necessary steps to stabilise the sector and support its needs. Doing that will not only help the home textile sector recover but also secure its long-term position in the global market.​

 

[Saif]

BGMEA seeks payment from Australian buyer

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) yesterday requested the Australian high commissioner in Bangladesh to take measures regarding approximately $20.30 million in outstanding payments that a Sydney-based company owes to 23 local exporters.

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BGMEA seeks payment from Australian buyer

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) yesterday requested the Australian high commissioner in Bangladesh to take measures regarding approximately $20.30 million in outstanding payments that a Sydney-based company owes to 23 local exporters.

Anwar Hossain, the administrator of the trade body, sent a letter Nardia Simpson, acting high commissioner of Australia in Bangladesh, seeking payments to the affected suppliers.

In the letter, Hossain said 16 BGMEA member factories had been experiencing non-payment issues with Mosaic Brands Ltd in September, reporting that approximately $14.9 million was outstanding at the time.

"We regret to inform you that an additional seven BGMEA member factories are now facing similar issues, with Mosaic Brands Ltd withholding export payments totalling approximately $4.9 million," according to the letter.

"We respectfully seek your kind support in securing the outstanding payments to the affected factories."

Ensuring these payments will not only safeguard the operations of these factories but also protect the livelihoods of the workers who depend on them, the administrator said.

Non-payment is adversely impacting the regular business activities of the factories in their dealings with the line banks.

Mosaic Brands Ltd, formerly Noni B Limited, grew into one of the largest speciality fashion retailers in Australia, with over 1,000 stores nationally, according to its website. The brands under its umbrella include Millers, Rockmans, Noni B, Rivers, Katies, Autograph, W Lane, Crossroads and Beme.

However, the company has run into financial trouble after cycling in and out of profitability in recent years.

On Monday, Mosaic Brands announced that it had entered voluntary administration, putting almost 3,000 jobs at risk.

Voluntary administration is a process where an insolvent company is placed in the hands of an independent person who can assess all the options available and generate the best outcome for a business owner and its creditors.​

 

[Saif]

Financial inclusion among garment workers low: Experts

Poor financial and digital literacy among garment workers in Bangladesh coupled with a lack of supportive policies and related data are the main barriers for improving financial inclusion for this segment, according to experts.

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Financial inclusion among garment workers low: Experts

Experts attend a roundtable styled “Improving Financial Health of RMG Workers in Bangladesh: Policy Frameworks and Future Pathways” at The Daily Star Centre in Dhaka yesterday. Photo: Amran Hossain

Poor financial and digital literacy among garment workers in Bangladesh coupled with a lack of supportive policies and related data are the main barriers for improving financial inclusion for this segment, according to experts.

Besides, the absence of formal employment contracts and prevalence of informal payment channels for garment workers are the other roadblocks to improving their financial inclusion.

These comments came at a roundtable, styled "Improving Financial Health of RMG Workers in Bangladesh: Policy Frameworks and Future Pathways".

The event was jointly organised by The Daily Star and Sarathi, a project of Swisscontact Bangladesh that works for improving the financial health of local garment workers, at The Daily Star Centre in Dhaka yesterday.

Sajid Amit, director of the Center for Enterprise and Society (CES) at the University of Liberal Arts Bangladesh (ULAB), said financial inclusion among garment workers has yet to reach its full potential.

In his presentation, titled "Stitching Financial Health for a Resilient Future: Policy Brief on Improving Financial Health of RMG Workers in Bangladesh", he informed that 70 percent of garment workers use mobile financial services (MFS).

However, challenges persist in improving their financial inclusion through MFS as only 30 percent of the workers own smartphones and have access to the internet.

Meanwhile, it was found that 45 percent of them have security concerns about digital transactions.

Amit also informed that while nano loans and earned wage access solutions have gained popularity among garment workers, their limited smartphone ownership, low credit score and other hurdles are preventing them from availing these facilities.

Moreover, garment workers are largely unable to visit bank branches during operating hours due to demanding factory schedules, which is why their banking activities are typically limited to fund withdrawals, deposits or transfers, he added.

During the presentation, the speakers said that access to loans is one of the main draws for financial inclusion as people often turn to external financing for large expenses.

However, most female garment workers face communication barriers that make it difficult for them to understand the products being offered.

Also, the absence of formal employment contracts means that it is nearly impossible for garment workers to secure bank loans.

Against this backdrop, Md Arfan Ali, chairman of Zaytoon Business Solutions, said bank policies in this regard are not aligned with the interests of marginalised people.

"This one of the reasons why financial inclusion has not improved among garment workers," he added.

Stressing the need for a legal framework to facilitate financial inclusion, Mohammad Rashed, president of Digital Finance Forum Bangladesh, said related policymakers and stakeholders should be knowledgeable to this end.

Mosleh Saad Mahmud, the head of cash management and liability marketing at Dhaka Bank, said the process of improving financial inclusion among garment workers should start from the banking sector.

But when the banks assess workers' eligibility for loans, they do not get the required information due to the lack of relevant data, such as the applicant's creditworthiness, he added.

Md Forhad Mahmud, head of mobile banking division and financial inclusion at Dutch Bangla Bank, said they facilitate the salary payments of 2.5 million workers through their MFS service "Rocket".

However, the accountholders limit their activities to only basic transactions for a lack of financial and digital literacy, he added.

Rumana A Tulee, assistant vice president of the agent banking division at Bank Asia, said four factors -- accessibility, convenience, supportive products and financial literacy -- should be improved to facilitate financial inclusion of workers.

Rashadul Islam, senior assistant vice president of Dhaka Bank, said the process and cost of access to finance should be made easier and more affordable for garment workers.

Terming infrastructure, innovation, skills and literacy as vital for expanding financial inclusion, Shariful Islam Chowdhury, project officer at UNCDF, said it is not possible to ensure financial inclusion by just providing access to banks accounts.

Tanjim Ferdous, in-charge (NGOs and foreign missions) of The Daily Star, stressed the importance of introducing related topics for improving financial literacy in academia.

Tahmina Khan Majlish, CEO of Digital Finance Forum Bangladesh, said the financial inclusion of garment workers would improve if their perspective is taken into consideration.

"It should be looked at whether the end-users feel comfortable, confident and secure," she added.

Shoheli Afrin, additional director of the Bangladesh Bank, highlighted various policies taken by the country's central bank for ensuring the financial inclusion of garment workers.

However, the central bank cannot improve financial inclusion on its own, she said, adding that commercial banks and factory owners also have roles and responsibilities to play in this regard.

Salma Akhter, senior manager of partnership and advocacy at Swisscontact Bangladesh, said the biggest challenge for ensuring financial inclusion is social barriers.

"To overcome these challenges, the mindsets of all stakeholders should be changed," she added.

Fazle Razik, head of programme at Swisscontact Bangladesh, said the issue of improving financial inclusion among garment workers was practically untouched when they started working on it.

"When it comes to our vision, we have come a long way and are slowly gaining new ground," he added.

Tasmina Rahman, managing director at Grameen Trust, Sk Khalidujjaman, associate director at Waadaa Insurance, and Ahmed Shamsul Huda, national business manager of Rocket, spoke at the event.

Mushfiqur Rahman, senior manager of projects and research at ULAB's CES, and Md Sajib Hussain, senior assistant secretary (international trade, environment and sustainability) of the Bangladesh Knitwear Manufacturers and Exporters Association, were also present.​

 

[Saif]

Bangladesh skips India, reroutes global textile exports through Maldives

Bangladesh, the world’s second-largest garment producer, has opted to bypass India and ship its textiles to global markets through the Maldives, hurting the cargo revenue prospects of India’s airports and ports amid strained bilateral ties, reports Mint.

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Bangladesh skips India, reroutes global textile exports through Maldives

Bangladesh’s garment exports fell 4.34 percent year-on-year to $44.47 billion in FY24, according to Bangladesh Bank. The decline was attributed primarily to reduced shipments of readymade garments, reflecting broader economic challenges. The photo was taken recently at a garment factory in Gazipur, around 25 kilometres north of the capital Dhaka. Photo: Anisur Rahman

Bangladesh, the world's second-largest garment producer, has opted to bypass India and ship its textiles to global markets through the Maldives, hurting the cargo revenue prospects of India's airports and ports amid strained bilateral ties, reports Mint.

The Indian business newspaper, citing three people aware of the development, reports that Bangladesh was rerouting its textile exports to the Maldives by sea and then dispatching cargoes by air to its global customers, including H&M and Zara.

"Previously, Bangladeshi goods were shipped through Indian airports, but now they are rerouting shipments from other locations," Deepak Tiwari, managing director of MSC Agency (India) Pvt Ltd, told Mint over the phone.

"This shift means India's airports and ports lose revenue previously earned from handling these cargoes," he said.

The Mediterranean Shipping Company (MSC) is a leading global container shipping company.

The redirection of textile exports could weaken trade relations between India and Bangladesh and reduce the collaborative opportunities in logistics and infrastructure projects, said the newspaper.

It could also potentially threaten India's revenue from port and transit fees, alongside business generated from Bangladesh's exports that pass through Indian borders, it said.

Seized by the issue, the Indian government is exploring a balanced solution to ensure that Bangladesh's textile exports—significant in volume and linked to Indian manufacturing hubs in Bangladesh—remain beneficial to Indian interests, one person said.

"A significant portion of these Bangladeshi textile exports are being produced in facilities or factories owned or operated by Indian companies based in Bangladesh," the first person said.

Bangladesh's textile industry contributes 80 percent of its exports and 13 percent of its GDP.

"The issue is under the government's attention. We are currently reviewing its impact on India," the second person said.

Industry experts suggested that Bangladesh took this step to gain greater control over its supply chain and meet its shipment deadlines by avoiding delays caused at India's airports, said Mint.

"This new route offers Bangladesh a strategic advantage along with improved reliability, which is crucial for meeting tight deadlines in the international clothing market," said Arun Kumar, president of the Association of Multimodal Transport Operators of India.

"Furthermore, by avoiding reliance on Indian ports, Bangladesh is ensuring greater control over its supply chain," said the chief of the association advocating seamless, efficient transportation solutions across sea, rail and road networks in India.

Kumar explained that textiles were also treated as perishable goods and that failure to deliver them on time results in the rejection of consignments. Garments meant for a specific season lose their value if they are delivered late.

Indian textile exporters had a different perspective on the rerouting of exports by Bangladesh.

"There's nothing to read into this," Anil Buchasia, executive member, eastern region, Apparel Export Promotion Council, told Mint over the phone.

"Indian airports are already congested, and we had also requested the government to restrict Bangladeshi textiles from passing through Indian airports," he said.

The third person aware of the developments dismissed suggestions that the move was linked to the ouster in August of former Bangladesh prime minister Sheikh Hasina, who is currently said to be staying in India.

The International Crimes Tribunal (Bangladesh) had issued an arrest warrant against her in October.

"The government does not see this as a reaction to Sheikh Hasina's asylum. Textiles are the backbone of Bangladesh's economy, so they must have made this decision to promote their textile exports," the third person said.

Bangladesh's garment exports fell 4.34 percent to $44.47 billion in FY24, according to Bangladesh Bank.

The decline was attributed primarily to reduced shipments of readymade garments, reflecting broader economic challenges.​

 

[Saif]

What's causing the unrest among factory workers?

Kalpona Akter, labour rights activist and president of Bangladesh Garment and Industrial Workers Federation, talks to The Daily Star.

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What's causing the unrest among factory workers?

What is causing the current wave of protests by factory workers?

Although the government accepted all 18 demands of RMG workers in late September, communication of the announcement, as well as the implementation, remained problematic. For example, demands such as increasing the tiffin allowance have not been adequately communicated to all the factories. Additionally, some factories showed reluctance to comply with the directive. In Ashulia, most factories accepted the directive, but in places like Gazipur and beyond, we noticed that the directive was not properly communicated and owners, too, were reluctant to comply.

Another issue regarding unpaid wages arose in several factories where the owners are currently absconding. Those aligned with or sheltered by the previous regime fled after the political shift or change in the government. As a result, there is no clear directive regarding who should control these factories, who will pay the wages, or who will uphold workers' rights. No clear instructions are available either from the factory authorities or from any government office or ministry. There is ambiguity regarding who is responsible—should it be the metropolitan police, the industrial police, or the military personnel, who were recently given temporary magistracy power?

Even though the military has, in many cases, attempted to locate owners and ensure wage payments, they, too, face challenges, as handling such matters is not part of their usual protocol. The industrial and local police, traditionally responsible for these matters, now appear hesitant. They always seem to be waiting for military intervention. Their fear of retribution because of past misuse of power remains unresolved. However, it will be unjust to blame workers for this fear, because the police themselves once misused the law and now hesitate to act due to concerns of retaliation.

Is there a political aspect influencing these labour issues?

Many factory owners were previously affiliated with the former ruling party, the Awami League or enjoyed AL's political shelter. Besides, many use the RMG industry, the largest in Bangladesh, to gain political advantage. By inciting a bit of unrest, one can easily capitalise on this politically or advance specific political goals, by scapegoating the workers. In this sense, workers are being used to further a political agenda, and we have observed such issues arising within the labour sector.

We see a similar problem in the scrap clothing industry, although the government has tried to mitigate the problems. Recently, disputes have broken out between two factions of the BNP over the scrap-based apparel business and there were similar unrests in Chattogram, Ashulia, and Gazipur. Unless this political conflict is addressed, a third party will continue to exploit workers for its own interests, making effective problem-solving even harder.

What steps could improve the situation between workers and factory owners?

Communication between factory owners and workers is essential to bridge the gap. Without clear communication, the distance between workers and owners will only grow. The best approach to reducing this gap is to allow workers to freely exercise their union rights. If workers can unionise freely and exercise their bargaining rights, it would significantly decrease external confrontations, enabling discussions to occur within the factory premises rather than on the streets.

One major unresolved issue remains—the demand for wage re-evaluation. For the past two to two-and-a-half months, workers have been demanding a wage increase. The government has set a deadline until December, and a committee has been established to address this issue. If this committee can work efficiently and produce a viable solution, it may bring calm to the industry in the coming days. I believe that the committee should recommend an increase in wages, taking into account workers' quality of life as well as the financial capacity of the industry. If the committee can provide a fair recommendation based on these factors, and the owners and government agree to it, then the wage increase may finally bring about the peace that workers seek in the industry.

Do you feel that any government has proactively supported workers in the past, even before any demands were raised?

No political party or administration has ever consistently advocated for the working class. When they do, it's often to appease specific groups or to fulfil their own interests. Throughout my career, I have never witnessed a government that voluntarily stepped up to improve workers' conditions. No administration has come forward with a dedicated plan to enhance workers' rights, nor has any government truly addressed workers' issues beyond verbal promises.

If this interim government disregards the importance of labour issues, they will be making a big mistake. Out of Bangladesh's 17 to 18 crore people, almost 7.5 crore belong to the labour force, across all levels, including white-collar employees. Ignoring their concerns is not an option; the government should sit down and engage in dialogue with representatives of the labour force.

In an ideal world, we would see political representation for workers, similar to the Labour Party in the UK. Though left-leaning groups in our country claim to represent the working class, throughout our history, we have not seen them being vocal in parliament. Labourers still have not reached the point where they can form their own political party or hire political representatives. However, an avenue should exist for workers to have a political voice. Otherwise, those of us in marginalised communities will continue to be left behind.​

 

[Saif]

Denim demand rebounds gradually: experts

The demand outlook for locally made denim garments is gradually improving as Western economies rebound, local and foreign businessmen said yesterday.

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Denim demand rebounds gradually: experts
Bangladesh Denim Expo kicks off in the capital

The 17th Bangladesh Denim Expo began at the International Convention City Bashundhara in Dhaka yesterday, with industry insiders expressing optimism that the demand for products made from the popular garment would rebound after slowing in recent years. Photo: Anisur Rahman

The demand outlook for locally made denim garments is gradually improving as Western economies rebound, local and foreign businessmen said yesterday.

There is intense competition in the global denim market as almost all competing countries, including Turkey, Pakistan and Vietnam, have always been strong denim producers.

Sales of denim products slowed over the last three years due to the severe fallouts of the Covid-19 pandemic, Russia-Ukraine war, and high inflationary pressures in the Western world, including the European Union (EU) and the US.

"Major challenges are coming for the overall export-oriented garment sector since Bangladesh will have to fulfil EU due diligence conditions by 2026 and reduce carbon emissions significantly by 2030," said Syed M Tanvir, managing director of Pacific Jeans, which produces more than 1.5 lakh denim trousers a day.

He also said that denim mills in the country need more value-addition to better compete on the global stage, adding that his company was targeting at least 12 percent export growth by the end of the year.

He made the remarks while visiting the 17th Bangladesh Denim Expo, which kicked-off at the International Convention City Bashundhara in Dhaka yesterday.

Md Ali Rasul (Tuhin), director of Team Group, said international clothing retailers and brands were worried by the recent spate of labour unrest in industrial belts as well as political volatility because they want timely delivery of goods.

If normalcy prevails, business will grow and work orders, which shifted to other countries in the aftermath of the political changeover on August 5, will begin to return, he said.

At a seminar on the sidelines of the expo, Ziaur Rahman, regional country manager, production (Bangladesh, Pakistan and Ethiopia) of Swedish retail giant H&M, outlined the commitments and improvements that customers would like to see.

"If you have demand or grievances, you can't opt for unrest. You need collective discussion. From vandalism, no one wins. Safety and security of the supply chain is a minimum requirement," Rahman said.

"Transparency is key. The supply chain should be self-sufficient. No one will monitor us but us. We should be responsible for our own operations."

He also suggested investing more in people and their development.

"Embrace technology. Innovation and research are really missing here," Rahman added.

He also suggested producing more value-added products to grab a bigger slice of the pie in the global apparel market, which was estimated to be valued at around $1.8 trillion.

Yilmaz Demir, a representative of Bossa, a Turkish denim fabrics supplier, said the slow demand for denim is temporary. Business will grow as inflationary pressures are also easing.

Muhammad Monsoor Bilal, senior vice-president of Karachi-based Naveena Group, said Bangladesh remains competitive globally because of price and quality.

He supplies five million metres of denim fabrics to local companies annually, adding that he expects his business in Bangladesh to grow at least 25 percent over the next year.

Manish Chauhan, chairman and co-founder of Noize Jeans, said Bangladesh is irreplaceable because of price and quality.

Chauhan has been doing business in Bangladesh for 20 years and is now running two garment factories that export denim goods worth $80 million a year.

Mostafiz Uddin, the organiser of the denim expo, said they were seeking better prices from international retailers and brands. However, he said the law-and-order situation should be improved further so buyers have more confidence in Bangladesh.

According to the organisers of the expo, many international exhibitors could not secure visas this year so they could not attend the event. Still, a total of 56 companies from 18 countries are participating in the two-day event.​

 

[Saif]

Garment exporters prefer cheaper Maldives, bypassing Dhaka, Indian airports

Exporters say the traditional air shipment routes through Dhaka, Kolkata, Colombo or Singapore had either become too expensive or too slow

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Garment exporters prefer cheaper Maldives, bypassing Dhaka, Indian airports

File photo

Bypassing the traditional air shipment routes through India or Bangladesh, garment exporters have found the Maldives to be a cheaper as well as faster route.

Exporters said air freight through the island nation of the Indian Ocean, about 2,800km away from Dhaka, saved them almost up to a dollar per kilogram of shipment cost to European countries.

They said the traditional air shipment routes through Dhaka, Kolkata, Colombo or Singapore had either become too expensive or too slow.
The RMG industry was facing a substantial backlog in the wake of the student protests of July and August when everything had ground to a halt.

Shipment rates through Dhaka had climbed to $6.30–$6.50 per kg, which has now come down to $3.80–$4.10 per kg for shipping to Europe.
This is when Bangladeshi exporters stumbled upon the new route through the Maldives.

Kabir Ahmed, president of Bangladesh Freight Forwarders Association (BAFFA) said, the Maldives airport route emerged almost organically as the cost of shipment was too high through other routes.There was a sudden surge of shipment demand as factories resumed production after the restoration of order as the interim government took over.

The demand for dry cargo shipment almost doubled to 800–900 tonnes at Dhaka airport from the usual 400–450 tonnes per day.

The exporters could not ship goods via the maritime route using Chattogram either because the student movement in July and August had halted operations at the port as well as much of the country. The consequent backlog also had to be cleared quickly once operations resumed as exporters became desperate to meet their looming deadlines, many of which had presumably been extended considering the political situation.

Dhaka's Hazrat Shahjalal International Airport is expensive for exporters because of its high operational costs, levies and operational hazards.

The Dhaka airport also suffers from a dearth of necessary equipment like scanning machines and explosive detection systems (EDS). Further, there are not enough airlines connecting to Dhaka to fly the goods out.

In contrast, local exporters say shipment through the Maldives is faster and costs only $3–$3.50 per kg.​