🇧🇩 Textile & RMG Industry of Bangladesh

[Saif]

How our RMG industry empowered women

The RMG industry has provided lakhs of women, with their first formal employment opportunities.

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How our RMG industry empowered women

FILE PHOTO: STAR

Over the past few decades, Bangladesh has emerged as a global hub for the ready-made garment (RMG) industry. The sector has played a pivotal role in transforming the socioeconomic landscape of the country. At the heart of this transformation is the empowerment of women, who make up the vast majority of the RMG workforce. A report by the International Labour Organisation (ILO) reveals that, as of 2020, our RMG sector employs around 32 lakh women. This sector's growth has created numerous job opportunities for Bangladeshi women, contributing to their economic empowerment while also playing a vital role in the growth of the economy.

The RMG industry has provided lakhs of women, particularly from rural areas, with their first formal employment opportunities. This shift from informal, often agricultural work, to formal employment in garment factories has had profound implications for their economic status and independence.

Earning a regular income has allowed women RMG workers to contribute to their household finances, often making them primary breadwinners. This financial independence has given them decision-making power within their families and communities. These women now have the means to invest in their children's education, healthcare, and better living conditions, leading to a positive cycle of development and improved quality of life.

Employment in the garment sector has also facilitated skills development. Many women enter the industry with little or no formal education. Through on-the-job training and experience, they acquire valuable skills in sewing, quality control, and production management. Some factories also offer literacy programmes and vocational training, further improving their capabilities and future employment prospects.

Beyond economic benefits, the RMG industry has been instrumental in fostering social empowerment of women in Bangladesh. By stepping into the workforce, women have challenged traditional gender roles and norms that often confined them to domestic duties. The presence of women in factories has gradually shifted societal perceptions of women's roles as well. As more women work outside home, the acceptance of women as economic contributors has increased.

Working in the garment industry has also facilitated greater social mobility for women. Employment has enabled women to move from rural areas to urban centres, exposing them to diverse cultures and ideas. This exposure has broadened their horizons, increased their awareness of rights and opportunities, and inspired many to pursue further education and career advancements.

However, this growth is not without challenges. Workers often face issues such as stagnated wages, long working hours, and challenging working conditions. These challenges have also sparked advocacy and efforts to improve labour rights and working conditions in the industry. Indeed, the rise of the garment sector has led to the growth of labour unions and advocacy groups fighting for workers' rights. These organizations have been instrumental in negotiating better wages, improving working conditions, and ensuring compliance with the labour law. Women workers have played a crucial role in these movements, often leading protests and strikes to demand fair treatment.

The Bangladesh government, along with international bodies and NGOs, has taken steps to address these challenges. The government had to take initiatives such as the Accord on Fire and Building Safety in Bangladesh and the Alliance for Bangladesh Worker Safety to improve factory safety standards following the Rana Plaza disaster in 2013. Additionally, programmes aimed at promoting fair wages and gender equality in the workplace have been introduced, further supporting the rights of female garment workers.

Women's increased economic participation has contributed to community development. As women invest in their families and communities, there is a noticeable improvement in areas such as health, education, and infrastructure. Empowered women are more likely to participate in community decision-making processes, advocating for issues such as clean water, sanitation, and better schools.

I truly believe that Bangladesh's RMG industry is a testament to the transformative power of employment in empowering women and lifting them out of poverty. While challenges remain, the strides made in economic and social empowerment, skills development, and advocacy for rights are undeniable. As the industry continues to evolve, it holds the potential to further enhance the lives of crores of women, driving not only the economic growth, but also social progress and gender equality in Bangladesh.

Mostafiz Uddin is the managing director of Denim Expert Limited. He is also the founder and CEO of Bangladesh Denim Expo and Bangladesh Apparel Exchange (BAE).​

 

[Saif]

Bangladesh may see fastest growth in cotton consumption: report

Bangladesh and Vietnam are expected to experience the fastest growth in cotton consumption and trade over the decade due to their competitive labour and production costs, which will lead to significant expansions in their milling capacities, according to a global report...

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Bangladesh may see fastest growth in cotton consumption: report
Moinul Haque 15 July, 2024, 22:42

A worker oversees a cotton processing machine at a factory in Habiganj recently. Bangladesh and Vietnam are expected to experience the fastest growth in cotton consumption and trade over the decade due to their competitive labour and production costs, which will lead to significant expansions in their milling capacities, according to a global report. | New Age photo

Bangladesh and Vietnam are expected to experience the fastest growth in cotton consumption and trade over the decade due to their competitive labour and production costs, which will lead to significant expansions in their milling capacities, according to a global report.

The report titled 'OECD‑FAO Agricultural Outlook 2024‑2033' said that over the next decade, global consumption of raw cotton was projected to increase by 1.7 per cent annually, driven by population growth and rising incomes in middle- and low-income countries.

The demand in the textiles and apparel sectors, as well as competition from substitutes, would remain key factors influencing raw cotton consumption, said the outlook, a collaborative effort by the Organisation for Economic Co-operation and Development and the Food and Agriculture Organisation of the United Nations.

The report projected that the global cotton trade would expand by 2.1 per cent annually, reaching 12.4 million tonnes by 2033, driven largely by increased mill use in Bangladesh and Vietnam, which heavily rely on imports to support their expanding textile sectors.

It also said that imports of raw by Bangladesh and Vietnam would grow by over 3 per cent annually, significantly contributing to global trade dynamics.

The OECD-FAO Agricultural Outlook said Bangladesh's mill consumption of cotton would increase to 2.42 million tonnes, which was 1.71 million tonnes in 2023.

The report showed that the country's import share of cotton would be 18 per cent in 2023 while the China would gain the highest 23 per cent of global share.

The United States would remain the largest exporter, with its share of world trade reaching 31 per cent by 2033, it mentioned.

Global cotton production is projected to steadily increase to 29 million tonnes by 2033, marking a 17-per cent rise from 21.14 million tonnes in the base year of 2004.

The growth will primarily stem from key producers; India is expected to contribute approximately 38 per cent to the global increase, followed by the United States (27 per cent) and Brazil (21 per cent).

The report also said that the reliance on imports, coupled with the projected growth in consumption, underscored Bangladesh's crucial role in the global cotton market.

According to the outlook, the phase-out of the Multi-Fibre Arrangement in 2005 initially favoured Chinese textile producers, but Bangladesh and Vietnam saw robust growth in their textile industries driven by abundant labour, low production costs and government support measures.

It said that Vietnam's accession to the World Trade Organisation in 2007 and significant foreign direct investments, particularly from Chinese entrepreneurs, further boosted its textile sector.

Additionally, free trade agreements such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the EU-Vietnam Free Trade Agreement facilitated greater market access for Vietnamese textile exports.

Similar foreign investments and FTAs contributed to Bangladesh's emergence as a major global player in textiles.

Furthermore, the report also said that the US-China trade dispute increased mill use in Bangladesh and Vietnam, driving their textile industry expansions.

In Bangladesh, investments in spinning capacity driven by increasing domestic demand for yarn and fabric are expected to raise cotton fibre consumption by 3.3 per cent annually, solidifying its position in the global textile market and significantly contributing to its economic development, the outlook observed.

Despite this shift, China is expected to retain its position as the largest cotton processing country in 2033, followed by India, with annual consumption growth projected at 0.9 per cent and 1.5 per cent respectively over the next decade.

According to the outlook, the global cotton production would grow as a result of improved yields and higher compliance with sustainable standards.

The leading producing countries — India, China, the United States, Brazil and Pakistan — are expected to account for about 77 per cent of global output by 2033.

The report identified that over the past decades, global demand for textiles fibres has sharply increased, driven mainly by population and income growth, particularly in low- and middle-income countries and the expanding demand has been largely supplied by chemical fibres.

Synthetic fibres offered diverse advantages over cotton, such as durability, wrinkle resistance, moisture-wicking properties and competitive pricing, leading the textile manufacturing industry to increasingly favour them over cotton fibres, it said.

As a result, global consumption of natural fibres, including cotton, reached its peak at 26.5 million tonnes in 2007, but declined to approximately 24.4 million tonnes in the period from 2021 to 2023.

Since the early 1990s, non-cotton fibres have steadily gained market share, reaching 78.2 per cent in 2023, while the cotton's share declined to 21.8 per cent, the report showed.

It also said that per capita consumption of non-cotton fibres continued to rise significantly, contrasting with stagnant or declining trends in per capita cotton consumption in recent years.

According to the Bangladesh Textile Mill Association, the country's cotton imports in the financial year 2023-24 stood at 7.5 million bales.​

 

[Saif]

Garment sector reeling from shutdown

DBL Group, a leading garment exporter, usually ships apparel worth around $50 million each month.

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Garment sector reeling from shutdown

Most garment and textile factories reopened yesterday after being kept shut for four days due to violence centring the quota reform movement and the imposition of a nationwide curfew. The units are now racing to meet the strict lead times set by international buyers. The photo was taken at a garment factory in the capital's Jurain yesterday. Photo: Palash Khan

DBL Group, a leading garment exporter, usually ships apparel worth around $50 million each month.

But this month, their shipment will fall by at least 30 percent since production had to be halted following a spell of violence centring the quota reform movement and the government's imposition of a nationwide curfew.

Being a large group, DBL has its own production facilities, including spinning and dyeing units alongside factories for production of garments and accessories.

However, all their units were shut because of the violence over the past four days. At the same time, a few goods-laden trucks were waiting at the Chattogram port to unload export cargo.

"So, the losses are enormous," said DBL Group Managing Director MA Jabbar, adding that the biggest blow was the dent to the confidence of international clothing retailers and brands.

DBL Group is not alone.

As production remained halted for four days, all small, medium and large garment exporters faced similar challenges.

Moreover, business owners could not contact international business partners because of an internet blackout since July 18. However, as broadband internet services gradually began to come back online since Tuesday night, the situation has been improving.

The impacts of the shutdown were felt more acutely by small and medium factories, which cannot afford big losses given their comparatively weaker financial strength.

A factory owner in Rupganj, who ships T-shirts and polo shirts worth $6 million each month to American and Canadian retailers, could not timely receive raw materials, sourced from both at home and abroad.

The unit needs at least $3 million worth of raw materials each month, including yarn, which accounts for 70 percent of the total raw material requirement, chemicals and fabrics.

Although the factory owner placed orders with a few local spinners and millers for yarn and fabrics, they could not supply the raw materials as transport operators stayed off the roads fearing violence.

Effectively, the shutdown put factory owners in a double bind because they could neither contact buyers nor continue production.

This is the peak time to confirm prices for goods to be shipped next summer and spring, but the owner could not send quotes online due to the internet blackout.

Now, more money will have to be spent since employees will have to work overtime in order to adhere to the strict lead time set by international buyers, the owner said, asking not to be named.

There were hopes that business would regain momentum from July onwards compared to previous seasons, when the impacts of the Covid-19 pandemic, Russia-Ukraine war, and high inflationary pressures took a toll on business. Instead, a new disruption has shaken up the sector, the owner added.

Syed M Tanvir, managing director of Pacific Jeans, a leading denim exporter based in Chattogram, shared a similar experience.

Tanvir declined to comment on details regarding losses, only stating that they were huge. He said their factories have been closed since Saturday, adding that the supply chain was also severely disrupted.

The lull in production at garment units has also adversely impacted those involved in the primary textile sector, including the main suppliers of yarn, fabrics and other raw materials.

Hundreds of tonnes of unsold yarn have piled up in mills due to the shutdown, transport operators' reluctance to carry goods and a fall in demand.

Fazlul Haque, managing director of Israq Spinning Mills, said he usually sells 100 tonnes of yarn each day. But unsold yarn began piling up before the beginning of the shutdown. At present, the situation has been exacerbated and there is a stockpile of over 2,000 tonnes of yarn at his factory.

Mohammad Ali Khokon, president of the Bangladesh Textile Mills Association (BTMA), said huge losses were incurred, adding that an assessment was ongoing. The BTMA called a meeting of the mill owners today to get more information about losses from owners, he said.

However, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has already completed its primary assessment of losses, saying that they amounted to Tk 6,400 crore over the past four days.

BGMEA President SM Mannan Kochi said that garment factories would have to pay around Tk 1,000 crore to workers despite no work being done over the past four days.

The amount of losses in the garments accessories sector is also high, he added.

According to the BGMEA, nearly 950 trucks with exportable garment items were waiting at the Chattogram port to be unloaded.

Garment and textile mills resumed operations yesterday, with workers and officials using their official identity cards as curfew passes.​

 

[Saif]

RMG exporters in a race against time to offset losses

Local apparel exporters are in a frantic race to recover the losses they incurred during the latest spell of violence centring the quota reform movement and nationwide curfew, with international retailers and brands pressuring them to ensure timely delivery of goods.

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RMG exporters in a race against time to offset losses

Photo: Star/File

Local apparel exporters are in a frantic race to recover the losses they incurred during the latest spell of violence centring the quota reform movement and nationwide curfew, with international retailers and brands pressuring them to ensure timely delivery of goods.

Following the shutdown of factories and mills for four days, apparel exporters are planning to keep their production units open on Friday and pay overtime bills to meet lead times as they believe increasing productivity can offset a portion of losses.

Due to the situation over the past week, suppliers had to cancel hundreds of pre-scheduled meetings and factory inspections. They also could not communicate with foreign buyers due to an internet blackout, which began on July 18 and persisted until July 23.

The disruption in production, delivery and shipment took place at a time when the sector is struggling to recover its international trade.

Bangladesh's garment shipments fell 5.2 percent to $33.04 billion in the July-May period of the last fiscal year compared to the same period a year prior, according to data from the Bangladesh Bank.

International buyers are also piling pressure on apparel exporters to ship goods quickly as they have to fill their stores with new designs ahead of Christmas, the biggest retail sales extravaganza in the Western world.

The months of July, August and September are the peak time for the shipment of goods to be sold during Christmas.

"Buyers do not want to hear about any crisis. They want on-time delivery of goods," said a garment exporter who ships T-shirts and polo shirts to the US and Canada.

The global apparel supply chain has been struggling to recover from the severe fallout of the Covid-19 pandemic, the Russia-Ukraine war, and historic inflationary pressure on Western consumers.

It was dealt another blow this year in the form of the Red Sea crisis, which triggered commercial vessel operators to nearly double shipping charges.

The shipment of goods from Bangladesh to Europe is taking at least a month more than in previous times due to the crisis, which has forced commercial vessel operators to forgo the traditional route through the Suez Canal and navigate an additional 3,500 kilometres around the Cape of Good Hope in Africa.

As such, in many cases, international clothing retailers and brands are asking for expensive air shipments so goods can reach stores timely.

If a kilogramme of garment is sent to Europe through waterways, it costs around 10 cents or less. But if the same shipment is sent through air from Dhaka airport, it costs more than $4.

An apparel exporter, asking not to be named, said: "I have planned to keep my factory open on Friday so I can ship goods timely and avoid work order cancellations and expensive air shipment."

However, another exporter said it would be difficult to cater to the work orders because of a raw material shortage, which happened because goods could not be transported to factories over the past week.

Faruque Hassan, managing director of Giant Group, said his American buyers could not place work orders during the past week. So, he sent two of his officers to the US so that he does not lose business.

It will take more than one month to overcome the losses of one week, he lamented, adding that port, customs and transport services should be expedited so the business can run smoothly.

"My buyers are yet to seek discounts or cancel orders, but I am sure that I have to make a lot of air shipments to meet deadlines," said another major exporter, seeking anonymity.

Overtime is the main measure to recover losses, he said, adding that customers are not willing to accept any delays in shipment as they need goods quickly to prepare for Christmas.

Mohammad Ali Khokon, president of Bangladesh Textile Mills Association, said the primary textile sector, which includes spinning, weaving, dyeing and finishing activities, lost $58.8 million over the last six days because of shutdown and internet blackout, which is about $9.8 million per day.

Although buyers are not cancelling work orders or seeking discounts, they are putting a pause on work orders or delaying them, which is creating a stockpile of yarn and fabrics in mills.

Khokon also sought a government waiver from extra port charges during the shutdown.

SM Mannan Kochi, president of the Bangladesh Garment Manufacturers and Exporters Association, said he would sit in a meeting in a day or two with the international buyers and request them to not cancel work orders or seek discounts.​

 

[Bilal9]

RMG exporters in a race against time to offset losses

Local apparel exporters are in a frantic race to recover the losses they incurred during the latest spell of violence centring the quota reform movement and nationwide curfew, with international retailers and brands pressuring them to ensure timely delivery of goods.

www.thedailystar.net

RMG exporters in a race against time to offset losses
View attachment 7097
Photo: Star/File

Local apparel exporters are in a frantic race to recover the losses they incurred during the latest spell of violence centring the quota reform movement and nationwide curfew, with international retailers and brands pressuring them to ensure timely delivery of goods.

Following the shutdown of factories and mills for four days, apparel exporters are planning to keep their production units open on Friday and pay overtime bills to meet lead times as they believe increasing productivity can offset a portion of losses.

Due to the situation over the past week, suppliers had to cancel hundreds of pre-scheduled meetings and factory inspections. They also could not communicate with foreign buyers due to an internet blackout, which began on July 18 and persisted until July 23.

The disruption in production, delivery and shipment took place at a time when the sector is struggling to recover its international trade.

Bangladesh's garment shipments fell 5.2 percent to $33.04 billion in the July-May period of the last fiscal year compared to the same period a year prior, according to data from the Bangladesh Bank.

International buyers are also piling pressure on apparel exporters to ship goods quickly as they have to fill their stores with new designs ahead of Christmas, the biggest retail sales extravaganza in the Western world.

The months of July, August and September are the peak time for the shipment of goods to be sold during Christmas.

"Buyers do not want to hear about any crisis. They want on-time delivery of goods," said a garment exporter who ships T-shirts and polo shirts to the US and Canada.

The global apparel supply chain has been struggling to recover from the severe fallout of the Covid-19 pandemic, the Russia-Ukraine war, and historic inflationary pressure on Western consumers.

It was dealt another blow this year in the form of the Red Sea crisis, which triggered commercial vessel operators to nearly double shipping charges.

The shipment of goods from Bangladesh to Europe is taking at least a month more than in previous times due to the crisis, which has forced commercial vessel operators to forgo the traditional route through the Suez Canal and navigate an additional 3,500 kilometres around the Cape of Good Hope in Africa.

As such, in many cases, international clothing retailers and brands are asking for expensive air shipments so goods can reach stores timely.

If a kilogramme of garment is sent to Europe through waterways, it costs around 10 cents or less. But if the same shipment is sent through air from Dhaka airport, it costs more than $4.

An apparel exporter, asking not to be named, said: "I have planned to keep my factory open on Friday so I can ship goods timely and avoid work order cancellations and expensive air shipment."

However, another exporter said it would be difficult to cater to the work orders because of a raw material shortage, which happened because goods could not be transported to factories over the past week.

Faruque Hassan, managing director of Giant Group, said his American buyers could not place work orders during the past week. So, he sent two of his officers to the US so that he does not lose business.

It will take more than one month to overcome the losses of one week, he lamented, adding that port, customs and transport services should be expedited so the business can run smoothly.

"My buyers are yet to seek discounts or cancel orders, but I am sure that I have to make a lot of air shipments to meet deadlines," said another major exporter, seeking anonymity.

Overtime is the main measure to recover losses, he said, adding that customers are not willing to accept any delays in shipment as they need goods quickly to prepare for Christmas.

Mohammad Ali Khokon, president of Bangladesh Textile Mills Association, said the primary textile sector, which includes spinning, weaving, dyeing and finishing activities, lost $58.8 million over the last six days because of shutdown and internet blackout, which is about $9.8 million per day.

Although buyers are not cancelling work orders or seeking discounts, they are putting a pause on work orders or delaying them, which is creating a stockpile of yarn and fabrics in mills.

Khokon also sought a government waiver from extra port charges during the shutdown.

SM Mannan Kochi, president of the Bangladesh Garment Manufacturers and Exporters Association, said he would sit in a meeting in a day or two with the international buyers and request them to not cancel work orders or seek discounts.​

It's only been about a week's worth of delays, I am sure the factories will bounce back into production nicely.

What will not be recovered however is the lives lost because of this lady's bullheaded attitude and greed. People will not forget this easily. There will be a high cost exacted from her and her sponsors.

 

[Saif]

It's only been about a week's worth of delays, I am sure the factories will bounce back into production nicely.

What will not be recovered however is the lives lost because of this lady's bullheaded attitude and greed. People will not forget this easily. There will be a high cost exacted from her and her sponsors.

I wonder why the Bangladeshi entrepreneurs are not establishing factories to manufacture textile machineries. Textile is the largest industry in Bangladesh and the annual import of textile machineries from abroad stands at $4 billion. So, local production of textile machineries could save the country $4 billion a year.

 

[Saif]

RMG factories resort to weekend production to minimise loss

The garment and textile millers kept factories open on last Friday in an effort to meet the sharp deadline set by their international retailers, as the latest weeklong countrywide violence ate up four vital days of their peak production season.

www.thedailystar.net

RMG factories resort to weekend production to minimise loss

Garment makers are desperately trying to meet deadlines as July, August and September are the peak season for shipping goods to buyers. Photo: Palash Khan

The garment and textile millers kept factories open on last Friday in an effort to meet the sharp deadline set by their international retailers, as the latest weeklong countrywide violence ate up four vital days of their peak production season.

Amid the perennial inadequate supply of gas and power outages, last week's internet shutdown came as a major challenge for the manufacturers, as they failed to send the inspection reports to their buyers online, which they have to do regularly.

The local garment manufacturers are frantically trying to cover up the losses as July, August and September are the peak months for shipping goods to the western buyers, which they will sell in the upcoming Christmas, the biggest retail sales season in the western world.

Many owners are also running their factories for additional hours, using overtime to adhere to the strict lead time in an effort to avoid going for expensive air shipments, giving big discounts or cancellation of work orders from the buyers.

The violence centring the quota reform movement eroded the foreign retailers' confidence in Bangladesh to a great extent, as many of the local garment suppliers have received 30 percent to 40 percent fewer work orders than usual as the buyers are following a go-slow policy.

Consequently, the international retailers and brands did not place fresh work orders and also did not confirm the price level for the goods meant for the next summer and spring, which they were supposed to do last week, the exporters said.

"I have been running my unit even on Friday as I have counted a huge loss because of the four-day factory shutdowns following the violence," said a garment exporter asking not to be named.

However, the exporter could not run the factory on Friday in full swing because of long power cuts.

"I am worried about how I will pay the workers' July salary as I made a loss this month and I failed to confirm goods' prices due to the internet disruption," the exporter said.

Shaif Ullah Mansur, managing director of Chattogram-based Mellow Fashions Ltd, said he used to run night shifts in his factory in peak production seasons when pressure from the buyers increases.

But this year he preferred not going for night shifts amid fears of being affected by violence although the work pressure is immense now. Mansur said the monthly income from his 800-worker factory is Tk 5 crore and he lost Tk 1 crore of his monthly income because of the weeklong violence.

"My American buyers are now asking me whether I am capable of supplying the goods in time if new work orders are placed."

Mohammad Zaber, managing director of Noman Group, the single largest textile and garment exporter of Bangladesh, said his company lost 40 percent of the monthly work orders because of the factory and mill shutdown and internet suspension.

This is the peak season for Zaber's company for the confirmation of work orders for the next summer and spring seasons.

He said his company has been communicating with the buyers for a time extension for shipment. Moreover, the shipment time extension does not end the problem, he said.

The commercial shipping vessels, which carry the export goods, have to follow a tight global schedule to meet the increased competitiveness since the beginning of the Covid-19 pandemic, the Russia-Ukraine war and the Red Sea crisis, he said.

Instant communication is very important in garment trade and both the buyers and suppliers use WhatsApp now, but the sad part is the service is down now, he added.

Two garment exporters said they lost one million pieces of garment production each during the last weeklong violence and now he is working day and night to cover up the losses and ship goods timely.

Mohammad Hatem, executive president of Bangladesh Knitwear Manufacturers and Exporters Association, said many factory managements ran their units on Friday but still many of them will have to face air shipment.​

 

[Saif]

Govt to waive port demurrage for RMG raw materials

The shipping ministry yesterday announced that it would waive demurrage charges for imported containers carrying accessories and raw materials for the readymade garment sector which could not be delivered from the Chattogram port as operational activities were hampered for the past seven days.

www.thedailystar.net

Govt to waive port demurrage for RMG raw materials

The shipping ministry yesterday announced that it would waive demurrage charges for imported containers carrying accessories and raw materials for the readymade garment sector which could not be delivered from the Chattogram port as operational activities were hampered for the past seven days.

Violence centring the quota reform movement, the government's imposition of a nationwide curfew, and a five-day internet blackout prevented the goods from being delivered on time from the country's premier seaport.

A press release issued by the shipping ministry's Senior Information Officer Md Jahangir Alam provided the update, but it did not specify a timeframe.

State Minister for Shipping Khalid Mahmud Chowdhury announced the decision at a meeting with a delegation of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) at his office in Dhaka yesterday, the release said.

BGMEA President SM Mannan led the delegation.

During a visit to the port on July 25, the state minister assured the media that the government would waive demurrage charges for delayed delivery of imported containers.

Addressing the meeting with the BGMEA yesterday, the state minister said the port remained operational despite the turmoil of the past week.

But due to the internet blackout, which affected the functioning of the port and customs authority, garment exporters failed to take timely delivery of their import consignments from the port, said the minister.

He said the decision was taken with the aim of assisting RMG factories to continue import and export activities through the port and ensure export shipments within the lead time fixed by the buyers.

BGMEA Vice-President Rakibul Alam, who was present at the meeting, told The Daily Star that the waiver would be effective for import containers that could not be taken out after the expiry of a four-day free stay.

Imported containers are allowed to stay at the port yards free of charge for the first four days after being unloaded from vessels.

For a 20-foot loaded container, the port charges demurrage at $6 per day during the first week following the four free days. It then charges $12 each day during the second week. From then onwards, it charges $24 per day.

For a 40-foot container, the charges are double.

Chittagong Port Authority (CPA) Secretary Md Omar Faruk said they heard about the decision but were yet to get an official letter in this regard.

Upon getting an official decision, the port authority will comply, he said.

Cargo and container delivery from the port yards gradually came to a halt since July 17 due to the volatile situation before the internet blackout, which began on July 18, caused further disruptions.

The lack of assessment facilities due to the absence of the internet as well as the countrywide curfew created a container congestion at the port.

On July 22, the Chattogram port was encumbered with 42,150 TEUs (twenty-foot equivalent units) of containers, occupying over 79 percent of the port's storage capacity of 53,118 TEUs.

Smooth operations of a port are hampered if containers occupy over 60 percent of its storage capacity, port officials said.​

 

[Bilal9]

I wonder why the Bangladeshi entrepreneurs are not establishing factories to manufacture textile machineries. Textile is the largest industry in Bangladesh and the annual import of textile machineries from abroad stands at $4 billion. So, local production of textile machineries could save the country $4 billion a year.

Some of the basic textile machinery (simple looms) are already made locally (for ganjee and lungi business). Mid-grade and of course Highest grade looms (waterjet and air jet looms) are all made overseas but some mid-grade looms are also assembled locally.

Making or assembling machinery locally has to be cost effective (for the end result, compared to imports) and when China is such a low-cost producer already for mid and higher grade looms, it doesn't encourage local Bangladeshi entrepreneurs to add value by making high grade textile loom parts or machines locally.

The primary reason is that high grade machinable steel and other parts making inputs (even CNC machining centers to make precision parts) are still cheaper in China because they are locally sourced from in-country suppliers there. Even in India these inputs are more expensive locally, so the inputs (such as high grade alloys and steel bars/ingots/rod stock) are all imported from China to make machines and parts in India.

The way Indians encourage local production of looms and parts of looms is by assigning very high import tariff on mfd. and finished machinery, especially from China. Bangladesh does not do so. But maybe we need to (like how we boldly did for the cellphone mfrs. by increasing tariff for finished cellphone imports).

Currently the Bangladeshi textile loom importer lobby is quite strong and they exert pressure on NBR and textile ministry not to heavily tax textile machinery imports which would actually encourage local loom and knitting machine manufacturing. That needs to change and it will when larger companies like Meghna, Energypac and other light engineering firms start pressuring the govt. to change tariff policy.

 

[Saif]

Some of the basic textile machinery (simple looms) are already made locally (for ganjee and lungi business). Mid-grade and of course Highest grade looms (waterjet and air jet looms) are all made overseas but some mid-grade looms are also assembled locally.

Making or assembling machinery locally has to be cost effective (for the end result, compared to imports) and when China is such a low-cost producer already for mid and higher grade looms, it doesn't encourage local Bangladeshi entrepreneurs to add value by making high grade textile loom parts or machines locally.

The primary reason is that high grade machinable steel and other parts making inputs (even CNC machining centers to make precision parts) are still cheaper in China because they are locally sourced from in-country suppliers there. Even in India these inputs are more expensive locally, so the inputs (such as high grade alloys and steel bars/ingots/rod stock) are all imported from China to make machines and parts in India.

The way Indians encourage local production of looms and parts of looms is by assigning very high import tariff on mfd. and finished machinery, especially from China. Bangladesh does not do so. But maybe we need to (like how we boldly did for the cellphone mfrs. by increasing tariff for finished cellphone imports).

Currently the Bangladeshi textile loom importer lobby is quite strong and they exert pressure on NBR and textile ministry not to heavily tax textile machinery imports which would actually encourage local loom and knitting machine manufacturing. That needs to change and it will when larger companies like Meghna, Energypac and other light engineering firms start pressuring the govt. to change tariff policy.

Your post is very informative. Thank you

 

[Saif]

Apparel retailers express concern about shipment delay

International clothing retailers and brands yesterday expressed concern about the timely shipment of goods following the latest spell of violence stemming from the quota reform movement, imposition of curfew and five-day internet blackout, which crippled economic activities.

www.thedailystar.net

Apparel retailers express concern about shipment delay

The disruption in production at garment factories caused by violence stemming from the quota reform movement as well as a nationwide curfew and internet blackout has created anxiety among foreign buyers, who are desperate to receive timely shipment of goods ahead of the Christmas season. PHOTO: STAR/FILE

International clothing retailers and brands yesterday expressed concern about the timely shipment of goods following the latest spell of violence stemming from the quota reform movement, imposition of curfew and five-day internet blackout, which crippled economic activities.

In light of the situation, retailers urged leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) to ensure timely shipment of goods to be sold during the Christmas season.

They also demanded that the government quickly restore high-speed internet and broadband services to allow quick communications with their headquarters abroad.

They made the demands at a meeting with BGMEA leaders at the trade body's office in the capital's Uttara.

Although it was a regularly scheduled meeting between the BGMEA and buyers, important issues came to the fore due to the recent crisis.

For example, buyers called for addressing the backlog and congestion of containers at the Chattogram and Benapole ports so that export activities could run smoothly, according to a senior BGMEA leader who was present at the meeting.

Their concerns had been compounded by the fact that factories faced a complete shutdown for four days, especially as the months of July, August and September are the peak time for the shipment of goods to be sold during Christmas, the biggest retail sales extravaganza in the Western world.

It is also the peak time to confirm the prices of goods to be shipped next summer and spring.

The disruption in production, delivery and shipment took place at a time when Bangladesh's exports were trending downwards.

Overall exports declined from $39.69 billion in the July-May period of FY23 to $37.35 billion in the same period of FY24, according to data from the Bangladesh Bank.

In the same period, Bangladesh's garment shipments fell 5.2 percent to $33.04 billion.

At present, many garment factories cannot continue timely production due to a lack of raw materials like yarn, which could not be transported to factories because of the volatile situation over the past week.

Furthermore, suppliers had to cancel hundreds of pre-scheduled meetings and factory inspections over the past week.

Almost all the major garment sourcing companies were present at the meeting, including representatives from retailers like H&M, M&S and Bestseller.

They expressed concern about difficulties transporting goods as well as shipments from Chattogram port while also lamenting the slow internet speed, which hindered communication with their headquarters.

After the meeting, BGMEA president SM Mannan Kochi said retailers and brands assured them that they would not seek discounts or air shipments or cancel work orders.

Kochi added that production had resumed at factories while internet services and port operations were restarted after meetings with the prime minister, ICT minister, home minister and shipping minister over the last few days.

The BGMEA chief also said retailers were a bit worried as they want fast internet and smooth operations in ports.

The garment sector incurred production losses amounting to Tk 6,400 crore during the four-day shutdown. Additionally, Tk 1,000 crore will have to be paid to workers although there was no production in the units.

Kochi urged the government to keep the garment sector out of the purview of curfews or any kind of political activity considering the importance of the sector.

Last week, Mohammad Ali Khokon, president of the Bangladesh Textile Mills Association, said the primary textile sector, which includes spinning, weaving, dyeing and finishing activities, lost $58.8 million in six days due to the shutdown and internet blackout, which is about $9.8 million per day.

Although buyers are not cancelling work orders or seeking discounts, they are putting a pause on work orders or delaying them, which is creating a stockpile of yarn and fabrics in mills.​

 

[Saif]

Global RMG buyers concerned over business disruption

Global apparel buyers and retailers on Monday expressed concerns over the disruption of business activities with Bangladesh, citing the ongoing issues with internet connectivity...

www.newagebd.net

Global RMG buyers concerned over business disruption
Staff Correspondent 29 July, 2024, 23:00

New Age file photo

Global apparel buyers and retailers on Monday expressed concerns over the disruption of business activities with Bangladesh, citing the ongoing issues with internet connectivity.

Despite the restoration of internet connection after a blackout amid unrests over the quota reform movement in the country, the connection remained slow, buyers said at a meeting with leaders of the Bangladesh Garment Manufacturers and Exporters Association at its office at Uttara in the capital Dhaka.

The buyers also urged the apparel manufacturers to ensure the timely shipment of goods and restore high-speed internet and broadband connections to facilitate communication with their headquarters.

According to the meeting sources, the global buyers also discussed about the image of Bangladesh over the recent violence centring on quota reform movement in which more than 200 people were killed.

The buyers requested the RMG sector leaders to work proactively to prevent the ongoing situation from affecting Bangladesh's eligibility for the GSP+ benefit in its largest export market, the European Union.

They emphasised that eligibility for the market access facility would depend on addressing several soft issues, meeting sources said.

The regional head of British multinational retailer Marks and Spencer, Shwapna Bhowmick, Swedish fast fashion brand H&M regional country manager Ziaur Rahman, along with representatives from Inditex and Bestseller were present in the meeting.

The BGMEA and the global buyers sought mutual support to mitigate the impact of the recent business disruption.

BGMEA vice-presidents Syed Nazrul Islam, Arshad Jamal Dipu, Abdullah Hil Rakib and Miran Ali, among others, were present.

Following the meeting, a buyer representative said that they were struggling to communicate with their respective headquarters even after the internet connection resumed on July 24.

The complete internet shutdown resulted in a total breakdown of communication and this disruption could negatively impact the country's image, he said.

Another buyers' representative said that they were facing difficulties in shipping containers to the ports as rail communication was yet to resume.

A BGMEA director told New Age that internet blackout was the prime concern for the buyers.

The buyers said that the recent internet cutoff had given a signal to the global stakeholders that Bangladesh could be disconnected from global communication any time.

Following the meeting, BGMEA president SM Mannan Kochi said that international retailers and brands assured the BGMEA that they would not seek any discounts, air shipments or cancellation of work orders due to the recent violence and production suspension.

During the meeting, Kochi also informed buyers about BGMEA's engagement with the government to restore stability in the industry and highlighted the significant loss of production and shipment during the closure, which caused severe financial and supply chain impacts.

'I urge everyone to consider the extraordinary circumstances and show considerate approach towards their suppliers,' the BGMEA president said.

Some of local apparel makers told New Age that they had decided to travel to various export destinations to directly communicate with their respective buyers, assuring them of timely production and shipments after the reopening of factories and other services.

They said that the buyers were worried and they (buyers) wanted to understand both the current situation and future prospects.

Shovon Islam, managing director of Sparrow Apparels Ltd, said that he planned to travel to the United States next week to meet with two major buyers who have been silent about new work orders.

He said that buyers were anxious and wanted clarity on what was happening and what would happen next.​

 

[Bilal9]

Your post is very informative. Thank you

You're welcome, as always.

 

[Saif]

Internet woes hit garment exports as buyers fret

Global apparel buyers on Monday expressed concern over the Internet connection, which is still slow after the restoration of a weeklong cutoff during the violent anti-quota movement. They urged sector leaders and suppliers to ensure timely goods shipments and restore high-speed Internet and broadb

thefinancialexpress.com.bd

Internet woes hit garment exports as buyers fret
Global fashion brands sound alarm over BD supply chain disruptions
Monira Munni
Published :
Jul 30, 2024 09:31
Updated :
Jul 30, 2024 10:21

Global apparel buyers on Monday expressed concern over the Internet connection, which is still slow after the restoration of a weeklong cutoff during the violent anti-quota movement.

They urged sector leaders and suppliers to ensure timely goods shipments and restore high-speed Internet and broadband connections to enable effective communication with their headquarters, according to sources.

At a meeting with the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) leaders at BGMEA headquarters in Dhaka's Uttara, the buyers also appealed to authorities and sector leaders to take proactive steps to prevent the ongoing situation from jeopardising Bangladesh's eligibility for GSP plus benefits in its largest export market, the European Union.

Ziaur Rahman, regional country manager of Swedish fast fashion clothing company H&M, Shwapna Bhowmick, regional head of British multinational retailer Marks and Spencer (M&S) and representatives from Inditex and Bestseller attended the meeting.

BGMEA President SM Mannan Kochi, vice-presidents Syed Nazrul Islam, Arshad Jamal Dipu, Abdullah Hil Rakib and Miran Ali were also present.

The BGMEA and buyers' forum pledged mutual support to mitigate the impact of recent disruptions, meeting sources said.

Speaking anonymously after the meeting, a buyer representative told The Financial Express that communication with headquarters remained problematic despite the Internet resumption on 24 July following a week-long blackout.

"Even during previous crises like Covid-19 and other political turmoils, the readymade garment industry was exempt from restrictions and high-speed Internet was available. But this time, the full cutoff of the Internet resulted in no communication," the representative said, adding that the overall communication breakdown could damage the country's image.

Another representative informed the meeting of difficulties in shipping containers to ports as rail communication is yet to resume.

Meeting sources said the GSP plus issue was also discussed, with participants urging BGMEA leaders to work closely with the government.

After the meeting with international retailers and brands, BGMEA President SM Mannan Kochi said the retailers and brands assured them that they will not seek any discount, air shipment or cancellation of work orders because of the latest spell of violence and suspension of production.

Earlier, he requested the buyers for the same issues.

Mr Kochi informed the meeting about BGMEA's engagement with the government to restore stability in the industry and added that they lost significant production and shipment during the closure, causing severe financial and supply chain impact at their end.

He said he assured the buyers that they were committed to meeting their expectations and doing everything within their limits to mitigate the impact of the recent disruptions.

"I urge them all to consider the extraordinary circumstances and show understanding towards their suppliers," he said, adding that any measures due to unexpected delay would only exacerbate challenges they were already facing.

When asked, H&M Regional Country Manager in Dhaka Ziaur Rahman said that H&M would not seek discounts for delays caused by factory closures and port congestion due to the Internet outage.

Meanwhile, local exporters and suppliers are now travelling to export destinations to reassure buyers of timely production and shipments following the reopening of factories and other services.

Talking to the FE, several exporters said buyers were concerned about the current and future situation, expressing worries about timely garment shipments due to violence and port delays.

Shovon Islam, managing director of Sparrow Apparels Ltd, told the FE that buyers were worried about the current situation and future developments.

He said he would travel to the US next week mainly to meet with two major buyers who had been silent about new work orders.

"I was expecting to see an increase in their orders, but they have not said anything specific. So I will fly over to convince them, as there were no delays in their previous shipments," he said.

Another exporter said a $1.5 million shipment from 14 July was still stuck at Benapole port due to customs clearance issues. They had sent an official to India to meet with a buyer who sourced about $25 million from their company.​

 

[Saif]

US cos shifting from BD in apparel sourcing

American fashion companies are actively diversifying their apparel- sourcing base and exploring opportunities especially in India amid growing risks and market uncertainty in Bangladesh, says a latest US study. It cites shipping delays and supply-chain disruptions and 'managing geopolitics and oth

thefinancialexpress.com.bd

US cos shifting from BD in apparel sourcing
Monira Munni
Published :
Jul 31, 2024 01:04
Updated :
Jul 31, 2024 01:04

American fashion companies are actively diversifying their apparel- sourcing base and exploring opportunities especially in India amid growing risks and market uncertainty in Bangladesh, says a latest US study.

It cites shipping delays and supply-chain disruptions and 'managing geopolitics and other political instability' related to sourcing which have newly emerged among US brands and retailers as top five concerns in 2024.

They consider India as more competitive than most other Asian suppliers regarding vertical-integration capability, manufacturing flexibility, and agility.

"While China (100-percent utilization rate) and Vietnam (89-percent utilization rate) still lead, for the first time since 2014 we conducted the survey, more respondents reported sourcing from India (89-percent utilization rate) than from Bangladesh (86 per cent utilization rate)," reads the report.

India in 2024 ranked second from fourth in 2023 while Bangladesh ranked down to fourth position from third last year.

Titled '2024 Fashion Industry Benchmarking Study', the study report also reveals that nearly 60 percent of respondents plan to expand apparel sourcing from India over the next two years, exceeding the planned expansion from any other Asian country.

By leveraging its more advanced local textile-manufacturing capability, India's apparel exports to the United States relied much less on imported components than economically developed countries such as Bangladesh, Cambodia, and Vietnam, according to the report.

Additionally, as India is elevated as a strategic partner with the United States, sourcing from there "is perceived as involving relatively lower geopolitical risks".

On the other hand, about 48 per cent of respondents expressed an interest in expanding apparel sourcing from Bangladesh over the next two years, down from 52 per cent in 2023 and 58 per cent in 2022.

"The high social-compliance risks involved in sourcing from the country remained a key concern for respondents."

Citing example, it says the high-profile labour protests over the minimum wage increase in late 2023 brought Bangladesh's social- responsibility record in the garment sector back into the news headlines.

The report has quoted one respondent as commenting, "We monitor the situation closely. Meanwhile, as an apparel-sourcing base, Bangladesh is well-known for its price competitiveness. However, the country's export potential has been constrained by its limited product diversification beyond basic cotton items and knitwear."

Findings of the eleventh edition of the survey, jointly conducted by the United States Fashion Industry Association (USFIA) and the University of Delaware, were released Monday.

It surveyed executives from 30 leading fashion brands, retailers, importers, and wholesalers, including some of the largest brands and retailers in the country, from April to June 2024.

The report shows that a higher percentage of respondents sourced from Cambodia and Indonesia (each 75 per cent utilization rate) and Pakistan (61 per cent utilization rate) this year, with the gaps in their utilization rates compared to the top tier significantly narrowing.

"The results reveal that US fashion companies have been diversifying their sourcing base beyond China, Vietnam, and Bangladesh, even though companies are not necessarily leaving Asia."

In comparison, almost all respondents, 97 per cent, to be specific, say at least 40 per cent of their total sourcing value or volume now comes from Asian countries other than China.

Specifically, respondents commonly placed about 11-30 percent of their sourcing orders in large-scale apparel-supplying countries such as Vietnam, Bangladesh, and India.

Limited by manufacturing capability, other smaller-scale Asian countries such as Cambodia, Indonesia, and Pakistan typically accounted for 1-10 percent of a fashion companies' total sourcing value or volume.

Asked about the buyer shift, Fazlul Hoque, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said it is concerning that Bangladesh is losing business to its competitors like China, Vietnam, India and Pakistan mainly because of high cost of production fuelled by high utility charges with severe shortage of energy, especially gas.

"Bangladesh competes only offering competitive prices whereas its competitors like China, India and Pakistan offer lowest price aggressively as they have their own raw materials," he said.

Local industry is facing high cost due to high gas and electricity prices while there is no adequate supply of energy while wages have been increased and interest rate goes up. All these erode their competitive edges.

"Even there is no prediction that the situation might improve and we have no options to minimize costs," he said, adding that situation is getting worse during last one year.

Another exporter says US big buyers are interconnected with their political parties and geopolitics matter in their sourcing patterns. And Bangladesh gets no duty benefit there.

Both the exporters expressed concern over the ongoing situation as they are getting queries from buyers over the present situation marked by anti-quota movement and violence-taming curfew.

Official figures from the Office of Textiles and Apparel (OTEXA) show that Bangladesh's readymade garment (RMG) exports to the US totalled $7.28 billion in 2023 in a 25.07-percent drop compared to the $9.72 billion earned in 2022.

Data showed that 2022 apparel earnings were almost double the 2013 earnings of $4.94 billion when the USA suspended its GSP facility for Bangladesh-made exportable goods on grounds of poor labour and safety standards immediately after the Rana Plaza building collapse.

Local RMG, however, does not enjoy the US GSP facility.

Bangladesh shipped clothing items worth $7.13 billion during January-December 2021, according to OTEXA data.

Bangladesh's apparel exports to the United States sustained a double-digit decline of 12.31 per cent in the first five months of 2024, reaching $2.90 billion.

On the other hand, India witnessed a 2.06-percent negative growth to earn US$2.08 billion during January-May period of 2024. Similarly, US apparel imports from India in 2023 had experienced negative growth of 21.42 per cent, reaching $4.46 billion. The figure was $5.69 billion in 2022, according to OTEXA data.​

 

[Saif]

Textile millers urge govt for loan relief amid financial crisis

Bangladesh Textile Mills Association (BTMA) has called on the government to provide lower interest rate loans and suspend loan instalments for six months to help the industry recover from significant losses caused by the recent unrest. In a letter addressed to Finance Minister Abul Hassan Mahmood

thefinancialexpress.com.bd

Textile millers urge govt for loan relief amid financial crisis
FE Online Desk
Published :
Aug 01, 2024 19:41
Updated :
Aug 01, 2024 19:41

Bangladesh Textile Mills Association (BTMA) has called on the government to provide lower interest rate loans and suspend loan instalments for six months to help the industry recover from significant losses caused by the recent unrest.

In a letter addressed to Finance Minister Abul Hassan Mahmood Ali, BTMA highlighted the severe impact of the unrest on the export sector. The letter noted that garment factories have faced extensive closures during the two weeks of instability, leading to the cancellation of purchase orders, reduced production, worker absenteeism, and raw material shortages, reports UNB.

The garment factory owners are struggling to stay afloat amid these challenges, the letter said. With the monthly payroll for July due, the situation is dire, it said.

BTMA proposed a one-year bank loan at a maximum interest rate of 2.0 per cent to cover the current month's salaries. They warned that without this financial support, there could be disruptions in paying workers' wages and allowances.

In addition to salary support, BTMA requested similar loan terms for paying July's gas and electricity bills.

The association also demanded a suspension of existing loan instalments, arguing that the heavily affected export-oriented industry cannot bear the burden of term loan repayments. They urged the government to make all term loans interest-free for the next six months and to suspend instalment payments.​

 

[Saif]

Deepening political crisis adds to RMG woes

The deepening political crisis in the country has exacerbated the woes of apparel industry, with exporters facing difficulties in operating factories, shipping goods, and booking work orders.

www.thedailystar.net

Deepening political crisis adds to RMG woes

The deepening political crisis in the country has exacerbated the woes of apparel industry, with exporters facing difficulties in operating factories, shipping goods, and booking work orders.

Garment exporters fear that if their workers join the ongoing movement across the country, it will further dent the sector, which was hamstrung for four days when factories were completely shuttered due to violence in mid-July.

The sector also suffered serious repercussions two weeks ago because of a five-day internet blackout, which hindered communications between garment suppliers and international retailers and brands, meaning they could not make business deals or hold meetings.

Last week, international retailers and brands expressed concern at a meeting with the leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), flagging the difficulties in communication with their headquarters and local suppliers.

They also pointed out that thousands of consignments were stuck at the Chattogram port for around a week.

Additionally, factories have been experiencing difficulties in booking work orders.

July, August and September are the peak months for the shipment of goods to be sold during the Christmas season. It is also when exporters book work orders for the following summer and spring seasons.

But because of the unrest that has persisted over the past two weeks, buyers are following a go-slow policy, which may continue in the near future.

For instance, the European Union (EU), Bangladesh's largest export destination, has already said it will not further negotiate with Bangladesh on a cooperation agreement in light of the present situation, which saw the deaths of at least 204 people, including students.

"We are apprehensive that garment workers may also be called to be involved in the movement," said former BGMEA President Md Shafiul Islam Mohiuddin.

Adding that hundreds of shipments could not be delivered on time, Mohiuddin said: "Altogether, we are in bad shape."

The garment sector, which was already struggling to recover from the severe fallouts of the Covid-19 pandemic, Russia-Ukraine war, Red Sea crisis and historic inflationary pressures on Western consumers, is now facing a domestic political crisis, he added.

Many have had to opt for expensive air shipments and provide discounts as they failed to ship goods timely due to a disruption in production following the internet blackout and shutdown of factories, he added.

"The biggest loss is the damage to the reputation of Bangladesh as a good supplying country. The country is now perceived as weak by international retailers and brands," said a European garment buyer, asking not to be named.

However, he added that his company was still booking work orders for upcoming seasons as factories are still operational.

He also said his company faced a shipment crisis as operations at the Chattogram port were moving at a snail's pace due to the internet disruption but added that shipments were now taking place smoothly.

He added that they would face further difficulties in shipment and placing work orders with local suppliers if the situation does not improve.

"My officers were sent to Chattogram to monitor the shipment problem as production was delayed, but they cannot return now in Dhaka," said a medium-level garment supplier, asking not to be named.

"The situation of booking work orders for next season is quite bad since I could not communicate with my buyers during the internet blackout," the factory owner added.

Arshad Jamal (Dipu), chairman of Tusuka Group, said the garment business is between two seasons as it is the peak time for the booking of work orders for next summer and spring as well as the peak time to send shipments ahead of Christmas.

He added that buyers were not willing to compromise on lead times.

Furthermore, the Red Sea crisis has also created a barrier to the timely shipment of goods.

Since October last year, international commercial vessels have had to travel an additional 3,500 kilometres around the Cape of Good Hope in Africa because of Houthi attacks along the Suez Canal, the main waterway between Asia and Europe.

This increased freight costs for international clothing retailers and brands.​

 

[Bilal9]

US cos shifting from BD in apparel sourcing

American fashion companies are actively diversifying their apparel- sourcing base and exploring opportunities especially in India amid growing risks and market uncertainty in Bangladesh, says a latest US study. It cites shipping delays and supply-chain disruptions and 'managing geopolitics and oth

thefinancialexpress.com.bd

US cos shifting from BD in apparel sourcing
Monira Munni
Published :
Jul 31, 2024 01:04
Updated :
Jul 31, 2024 01:04
View attachment 7223

American fashion companies are actively diversifying their apparel- sourcing base and exploring opportunities especially in India amid growing risks and market uncertainty in Bangladesh, says a latest US study.

It cites shipping delays and supply-chain disruptions and 'managing geopolitics and other political instability' related to sourcing which have newly emerged among US brands and retailers as top five concerns in 2024.

They consider India as more competitive than most other Asian suppliers regarding vertical-integration capability, manufacturing flexibility, and agility.

"While China (100-percent utilization rate) and Vietnam (89-percent utilization rate) still lead, for the first time since 2014 we conducted the survey, more respondents reported sourcing from India (89-percent utilization rate) than from Bangladesh (86 per cent utilization rate)," reads the report.

India in 2024 ranked second from fourth in 2023 while Bangladesh ranked down to fourth position from third last year.

Titled '2024 Fashion Industry Benchmarking Study', the study report also reveals that nearly 60 percent of respondents plan to expand apparel sourcing from India over the next two years, exceeding the planned expansion from any other Asian country.

By leveraging its more advanced local textile-manufacturing capability, India's apparel exports to the United States relied much less on imported components than economically developed countries such as Bangladesh, Cambodia, and Vietnam, according to the report.

Additionally, as India is elevated as a strategic partner with the United States, sourcing from there "is perceived as involving relatively lower geopolitical risks".

On the other hand, about 48 per cent of respondents expressed an interest in expanding apparel sourcing from Bangladesh over the next two years, down from 52 per cent in 2023 and 58 per cent in 2022.

"The high social-compliance risks involved in sourcing from the country remained a key concern for respondents."

Citing example, it says the high-profile labour protests over the minimum wage increase in late 2023 brought Bangladesh's social- responsibility record in the garment sector back into the news headlines.

The report has quoted one respondent as commenting, "We monitor the situation closely. Meanwhile, as an apparel-sourcing base, Bangladesh is well-known for its price competitiveness. However, the country's export potential has been constrained by its limited product diversification beyond basic cotton items and knitwear."

Findings of the eleventh edition of the survey, jointly conducted by the United States Fashion Industry Association (USFIA) and the University of Delaware, were released Monday.

It surveyed executives from 30 leading fashion brands, retailers, importers, and wholesalers, including some of the largest brands and retailers in the country, from April to June 2024.

The report shows that a higher percentage of respondents sourced from Cambodia and Indonesia (each 75 per cent utilization rate) and Pakistan (61 per cent utilization rate) this year, with the gaps in their utilization rates compared to the top tier significantly narrowing.

"The results reveal that US fashion companies have been diversifying their sourcing base beyond China, Vietnam, and Bangladesh, even though companies are not necessarily leaving Asia."

In comparison, almost all respondents, 97 per cent, to be specific, say at least 40 per cent of their total sourcing value or volume now comes from Asian countries other than China.

Specifically, respondents commonly placed about 11-30 percent of their sourcing orders in large-scale apparel-supplying countries such as Vietnam, Bangladesh, and India.

Limited by manufacturing capability, other smaller-scale Asian countries such as Cambodia, Indonesia, and Pakistan typically accounted for 1-10 percent of a fashion companies' total sourcing value or volume.

Asked about the buyer shift, Fazlul Hoque, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said it is concerning that Bangladesh is losing business to its competitors like China, Vietnam, India and Pakistan mainly because of high cost of production fuelled by high utility charges with severe shortage of energy, especially gas.

"Bangladesh competes only offering competitive prices whereas its competitors like China, India and Pakistan offer lowest price aggressively as they have their own raw materials," he said.

Local industry is facing high cost due to high gas and electricity prices while there is no adequate supply of energy while wages have been increased and interest rate goes up. All these erode their competitive edges.

"Even there is no prediction that the situation might improve and we have no options to minimize costs," he said, adding that situation is getting worse during last one year.

Another exporter says US big buyers are interconnected with their political parties and geopolitics matter in their sourcing patterns. And Bangladesh gets no duty benefit there.

Both the exporters expressed concern over the ongoing situation as they are getting queries from buyers over the present situation marked by anti-quota movement and violence-taming curfew.

Official figures from the Office of Textiles and Apparel (OTEXA) show that Bangladesh's readymade garment (RMG) exports to the US totalled $7.28 billion in 2023 in a 25.07-percent drop compared to the $9.72 billion earned in 2022.

Data showed that 2022 apparel earnings were almost double the 2013 earnings of $4.94 billion when the USA suspended its GSP facility for Bangladesh-made exportable goods on grounds of poor labour and safety standards immediately after the Rana Plaza building collapse.

Local RMG, however, does not enjoy the US GSP facility.

Bangladesh shipped clothing items worth $7.13 billion during January-December 2021, according to OTEXA data.

Bangladesh's apparel exports to the United States sustained a double-digit decline of 12.31 per cent in the first five months of 2024, reaching $2.90 billion.

On the other hand, India witnessed a 2.06-percent negative growth to earn US$2.08 billion during January-May period of 2024. Similarly, US apparel imports from India in 2023 had experienced negative growth of 21.42 per cent, reaching $4.46 billion. The figure was $5.69 billion in 2022, according to OTEXA data.​

Indian companies can win a few one-off apparel orders because of unrest in Bangladesh, but they are structurally incapable of serving larger and more established buyers like H&M etc. in the longer term.

I won't go into the many reasons but we can discuss if there is interest.

There are Indian companies sitting in Bangladesh with established factories in fact.

 

[Saif]

Sharing tussles over major sea route worry exporters

A veritable tug-of-war ambiance over seizing market share in Bangladesh's one of the biggest sea routes stokes up concerns among the users, especially clothing exporters, about cost and time escalations. This route carries importance for the shipment from Bangladesh as it facilities four-day lead

thefinancialexpress.com.bd

Sharing tussles over major sea route worry exporters

Some foreign shippers desert Colombo-West transshipment route following rules tightening
Jasim Uddin Haroon
Published :
Aug 04, 2024 00:21
Updated :
Aug 04, 2024 00:26

A veritable tug-of-war ambiance over seizing market share in Bangladesh's one of the biggest sea routes stokes up concerns among the users, especially clothing exporters, about cost and time escalations.

This route carries importance for the shipment from Bangladesh as it facilities four-day lead time for the clothing exporters, in particular.

The fights between Bangladesh-flaged vessels and foreign ships began soon after the issuance of a rule under the Bangladesh Flag Vessels Act 2019 sometime in 2023 by the government of Bangladesh, sources in the shipping circles said.

The Chattogram-Colombo route leading to major markets handles more than 40 per cent of goods belonging to Bangladesh. The country's total external trade is believed to be worth US$120 billion.

The major international shipping route connects Bangladesh with its trading partners across the globe. After reaching Colombo, Sri Lanka, the cargos are loaded onto big vessels bound for different destinations in America and Europe.

When the government's implementing agency concerned, named MMD, enforced the rule tightly through showcases and penalties on foreign vessels, many foreign vessels withdrew from the route.

The rule provides for waiver certificate from the MMD for transporting goods belonging to Bangladesh. The certificate should have been taken 15 days earlier despite the fact that the one-side voyage needs to be completed in 3-4 days.

Before such execution of the rule called flat protection or protection of interests, there were more than 20 vessels, mostly foreign feeder vessels, plying the transshipment route.

Now it is trimmed to around 12 vessels, mostly Bangladesh-flagged vessels.

One of world's shipping giants -- CMA-CGM of France -- Tokyo-based ONE, Doha-based MALIHA and Dubai-based Unifeeder left the route. Many shipping executives blame the tussle between the local and foreign shipping companies for the situation.

The Flag Protection Act was enacted with the aim of transporting 50 per cent of the country's merchandise on domestic vessels, including the state-owned Bangladesh Shipping Corporation (BSC) ships.

"But the BSC does not have any single-container ship and, as such, it is impossible to transport 50 per cent of goods by domestic ships," says one of the trade sources.

One local flag-vessel company, HR Line, now dominates the cargo-haulage route.

Contrarily, one leading foreign line, X-press Line of Singapore, is struggling to survive on the route despite the fact that the relevant UN body is in favour of maintaining a level playing field for all.

As per the UNCTAD, 40 per cent can be protected for the local vessels, 40 per cent belong to the trading-partner vessels and the remaining 20 per cent to be kept open for grabs.

As the foreign vessels are leaving the route, port-users apprehend "monopoly" from local shipping companies on the vital part of the country's foreign-trade processing.

Garment manufacturers that employ more than 5.0 million people, mostly women, in the jobs-scant economy, raised their voice few times against the execution of the rule, arguing this will impact their shipments.

Syed Nazrul Islam, a first vice president of BGMEA, the apex body of garment producers, told the FE that they had expressed their concern many times on the issue as they believe their goods delivery may be affected once there be shortage of vessels meant for the Ctg-Colombo route.

"We produce clothing for different seasons, and once there are delays in reaching the goods, the buyers will not pay as we had contracted them."

Mr. Islam notes that once they fail due to poor number of vessels on the route, delivery of goods will be impacted and buyers will not give them orders for the next season.

He mentions that this route is very much important for them as they enjoy 4-day lead time.

One senior official at HR Line, when met its Dhaka office, told the FE correspondent that they are still having a much lower share than they should have enjoyed under the rule.

"Actually we don't get any special privilege," he said.

Asked about the penalties imposed on the foreign ships, he said that the penalties should have been much more.

The shipper, however, informed that Unifeeder was their own agency and they requested them to withdrew as there is no good business for the line there.

The World Shipping Council issued another letter urging the government to amend some sections of the rule, on a note of concern over the fist-tightening.

The Singapore office of the Washington-based navigation organisation called for relaxation of several terms and conditions laid down in the law. It referred to the provision of obtaining waiver certificate in 15 days prior schedule.

President of BCSA or Bangladesh Container Shipping Association Mr. Fayaz told the FE that many internationally reputed shipping companies left the route.

He said local HRL has only 8.0-9.0-percent share. "In future any big shipping company will not come."

Captain Sabbir Mahmood, principal officer of the MMD, could not be contacted after reaped attempts for his comment on what looks like a tug-of-war ambiance over the seafaring.​

 

[Bilal9]

Sharing tussles over major sea route worry exporters

A veritable tug-of-war ambiance over seizing market share in Bangladesh's one of the biggest sea routes stokes up concerns among the users, especially clothing exporters, about cost and time escalations. This route carries importance for the shipment from Bangladesh as it facilities four-day lead

thefinancialexpress.com.bd

Sharing tussles over major sea route worry exporters

Some foreign shippers desert Colombo-West transshipment route following rules tightening
Jasim Uddin Haroon
Published :
Aug 04, 2024 00:21
Updated :
Aug 04, 2024 00:26

A veritable tug-of-war ambiance over seizing market share in Bangladesh's one of the biggest sea routes stokes up concerns among the users, especially clothing exporters, about cost and time escalations.

This route carries importance for the shipment from Bangladesh as it facilities four-day lead time for the clothing exporters, in particular.

The fights between Bangladesh-flaged vessels and foreign ships began soon after the issuance of a rule under the Bangladesh Flag Vessels Act 2019 sometime in 2023 by the government of Bangladesh, sources in the shipping circles said.

The Chattogram-Colombo route leading to major markets handles more than 40 per cent of goods belonging to Bangladesh. The country's total external trade is believed to be worth US$120 billion.

The major international shipping route connects Bangladesh with its trading partners across the globe. After reaching Colombo, Sri Lanka, the cargos are loaded onto big vessels bound for different destinations in America and Europe.

When the government's implementing agency concerned, named MMD, enforced the rule tightly through showcases and penalties on foreign vessels, many foreign vessels withdrew from the route.

The rule provides for waiver certificate from the MMD for transporting goods belonging to Bangladesh. The certificate should have been taken 15 days earlier despite the fact that the one-side voyage needs to be completed in 3-4 days.

Before such execution of the rule called flat protection or protection of interests, there were more than 20 vessels, mostly foreign feeder vessels, plying the transshipment route.

Now it is trimmed to around 12 vessels, mostly Bangladesh-flagged vessels.

One of world's shipping giants -- CMA-CGM of France -- Tokyo-based ONE, Doha-based MALIHA and Dubai-based Unifeeder left the route. Many shipping executives blame the tussle between the local and foreign shipping companies for the situation.

The Flag Protection Act was enacted with the aim of transporting 50 per cent of the country's merchandise on domestic vessels, including the state-owned Bangladesh Shipping Corporation (BSC) ships.

"But the BSC does not have any single-container ship and, as such, it is impossible to transport 50 per cent of goods by domestic ships," says one of the trade sources.

One local flag-vessel company, HR Line, now dominates the cargo-haulage route.

Contrarily, one leading foreign line, X-press Line of Singapore, is struggling to survive on the route despite the fact that the relevant UN body is in favour of maintaining a level playing field for all.

As per the UNCTAD, 40 per cent can be protected for the local vessels, 40 per cent belong to the trading-partner vessels and the remaining 20 per cent to be kept open for grabs.

As the foreign vessels are leaving the route, port-users apprehend "monopoly" from local shipping companies on the vital part of the country's foreign-trade processing.

Garment manufacturers that employ more than 5.0 million people, mostly women, in the jobs-scant economy, raised their voice few times against the execution of the rule, arguing this will impact their shipments.

Syed Nazrul Islam, a first vice president of BGMEA, the apex body of garment producers, told the FE that they had expressed their concern many times on the issue as they believe their goods delivery may be affected once there be shortage of vessels meant for the Ctg-Colombo route.

"We produce clothing for different seasons, and once there are delays in reaching the goods, the buyers will not pay as we had contracted them."

Mr. Islam notes that once they fail due to poor number of vessels on the route, delivery of goods will be impacted and buyers will not give them orders for the next season.

He mentions that this route is very much important for them as they enjoy 4-day lead time.

One senior official at HR Line, when met its Dhaka office, told the FE correspondent that they are still having a much lower share than they should have enjoyed under the rule.

"Actually we don't get any special privilege," he said.

Asked about the penalties imposed on the foreign ships, he said that the penalties should have been much more.

The shipper, however, informed that Unifeeder was their own agency and they requested them to withdrew as there is no good business for the line there.

The World Shipping Council issued another letter urging the government to amend some sections of the rule, on a note of concern over the fist-tightening.

The Singapore office of the Washington-based navigation organisation called for relaxation of several terms and conditions laid down in the law. It referred to the provision of obtaining waiver certificate in 15 days prior schedule.

President of BCSA or Bangladesh Container Shipping Association Mr. Fayaz told the FE that many internationally reputed shipping companies left the route.

He said local HRL has only 8.0-9.0-percent share. "In future any big shipping company will not come."

Captain Sabbir Mahmood, principal officer of the MMD, could not be contacted after reaped attempts for his comment on what looks like a tug-of-war ambiance over the seafaring.​

There is no tug of war. We can't let foreign cargo carriers have unfair preference over our own flag vessels. If needed, we will buy/lease more container carrier ships (quite easy to do) and ship our own stuff. Money remains in Bangladesh. CMA/CGM and other container carrying shipping lines can find their own business in other countries.

We should give business preferentially to Bangladeshi shipping companies like HR, they are our taxpayers. Some foreign company Dalals are raising a big hoo-haa because their roti-kapra is being affected. No Dalali allowed anymore against national interest.

 

[Saif]

Textile units to remain closed

Textile millers will keep their production units closed due to the prevailing volatile situation in the country.

www.thedailystar.net

Textile units to remain closed

Textile millers will keep their production units closed due to the prevailing volatile situation in the country.

Bangladesh Textile Mills Association (BTMA), which represents the $25 billion primary textile sector, announced the decision in a statement yesterday.

The decision came because of the deteriorating law and order situation in the country and the government's declaration of a three-day holiday from today, the BTMA said.

"The decisions on reopening the mills will be made based on the situation and further declarations from the government," it said.

The BTMA member mills were also shut down for four days two weeks ago due to violence and a subsequent curfew imposed by the government to rein in violence.

The trade body reported that its members lost $58.8 million during the initial four-day closure caused by the violence and curfew.​

 

[Saif]

Garment factories shut down for indefinite period

Out of fear of vandalism and subsequent losses amid the current spell of violence, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) yesterday instructed all the factory owners to keep their units shut until further notice.

www.thedailystar.net

Garment factories shut down for indefinite period

A sign on the wall of a garments unit states that the facility is closed due to the imposition of an indefinite curfew by the government because of heightened unrest around the country on the first day of a non-cooperation movement called by students. Photo: Anisur Rahman

Out of fear of vandalism and subsequent losses amid the current spell of violence, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) yesterday instructed all the factory owners to keep their units shut until further notice.

The garment exporters' platform circulated the message among the members through WhatsApp, said Md Ashikur Rahman Tuhin, a director of the BGMEA.

This is yet another blow to the sector as the apparel factories were shut down for four days during the first round of violence two weeks ago though this is the peak season for Christmas shipments and taking work orders for the next summer and spring seasons.

During the violence in mid-July, the exporters could not communicate properly with their business partners abroad because of an internet blackout.

Exporters now fear mounting losses as export performance had already been poor over the last two years because of the severe fallout of Covid-19 pandemic, Russia-Ukraine war, runaway inflation in the Western world, Red Sea crisis and a labour unrest at home.

Amid violence across the country, majority of garment factories were shut down yesterday on the first day of a countrywide non-cooperation movement called by the organisers of Anti-Discrimination Student Movement.

At least 73 people, including 14 policemen, were killed and dozens injured yesterday as fierce clashes took place in different areas in Dhaka and other parts of Bangladesh.

More than 400 garment factories in Narayanganj, Narayanganj BSCIC and Fatullah areas were closed though many of the units ran for some time in the morning.

Some factories were operational in Rupganj and Araihazar areas of Narayanganj district, said Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).

Also, almost all the factories in Ashulia, Savar, Maona, Tongi and Chattogram had started production in the morning, but after a few hours the student protests began and some factories were vandalised, leading to the closure of the units.

At least six garment factories were vandalised in Narayanganj BSCIC and its adjacent areas, Hatem said, adding that fearing further escalation of the vandalism, the other factory owners have shut down their units.

Hatem confirmed that the workers left their workplaces peacefully after the shutdown.

"We will sit in meetings soon with the owners, the government and other high-ups on how to run our factories," Hatem said, adding that they will monitor the situation at least for two days.

Factories in Konabari and Kashimpur under Gazipur district were shut down although those were opened in the morning, said Arshad Jamal Dipu, vice-president of the BGMEA.

The factories were shut down anticipating violence, he said but could not confirm how many factories were closed.

He said the factory owners are fearing a shutdown of internet again as two weeks ago they suffered a lot and lost business because of the internet blackout. Exporters could not communicate online with their foreign retailers and brands.

Moreover, this is the time for bond renewal of the export-oriented garment factories and already seven factories have complained to him that they cannot renew the bond licences because of the current crisis, Dipu also said.

The owners are also facing trouble in garment shipment and import of raw materials, he added.

Md Towhidur Rahman, president of Bangladesh Apparel Workers Federation, confirmed that all the garment factories in Kaliakoir area have been shut down by the owners fearing escalation of unrest in the sector.

The owners announced closure to save their factories and other assets, he said.

Nazma Akter, president of Sammilito Garment Sramik Federation, a workers' platform, said that the BGMEA leaders held a meeting with the union leaders on Saturday and asked them to be more responsible during the crisis so that the garment factories could remain safe.

The owners are announcing closure of the factories fearing spread of violence in the sector, she said.

The garment exporters fear that if their workers join the ongoing movement across the country, it will further dent the sector, which was hamstrung for four days when factories were completely shuttered due to violence in mid-July.

The sector also suffered serious repercussions because of a five-day internet blackout, which hindered communications between garment suppliers and international retailers and brands, meaning they could not make business deals or hold meetings.

Last week, international retailers and brands expressed concern at a meeting with the leaders of the BGMEA, flagging the difficulties in communication with their headquarters and local suppliers.

The months of July, August and September comprise the peak season for both shipment of goods for next Christmas and also for booking the work orders from the international retailers and brands for the next summer and spring seasons.

The BGMEA has already said they have incurred losses of Tk 6,400 crore because of the shutdown and internet blackout, while the losses estimated by Bangladesh Textile Mills Association stand at $58.8 million.​

 

[Saif]

RMG exporters expect new vigour in business

Garment exporters are expecting a strong recovery in exports and business as normalcy is being gradually restored with the changing political scenario.

www.thedailystar.net

RMG exporters expect new vigour in business

Garment exporters have lost Tk 6,400 crore due to the recent unrest and shutdown of factories, said Bangladesh Garment Manufacturers and Exporters Association. Photo: Star/file

Garment exporters are expecting a strong recovery in exports and business as normalcy is being gradually restored with the changing political scenario.

The business environment was facing an impasse because of the latest spells of violence and frequent shutdown of factories, for which they were unable to manufacture goods for export.

Exporters also said, though July, August and September comprise the peak season for shipping goods meant for Christmas and for booking work orders for the coming summer and spring seasons, they were facing challenges in sending goods to retailers through Chattogram port amid violence.

They were also unable to communicate with their business partners both at home and abroad because of the recent internet blackout across the country and for the violence.

The apparel manufacturers are now planning to reopen their production units and to restart with a new vigour as they have been facing shutdowns, difficulties in transportation and shipment of goods over more than one month because of the political crisis.

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) called a meeting yesterday at 7:30pm to discuss the next course of action as the prime minister resigned, said a director.

They decided that the garment factories and textile mills will stay shut for now considering the current situation. The owners may take a decision on factory reopening today.

They had earlier shut down their units two weeks ago for four days amidst violence and curfew. During the first round of shutdown, they could not even communicate with their international clothing retailers and brands because of an internet blackout across the country.

Because of the latest spell of student movement and political impasse, the BGMEA has already said they have lost Tk 6,400 crore while the textile millers said the amount of their loss is more than $58.8 million.

The garment and textile millers have shut down their production units across the country fearing labour unrest and vandalism, which will cause a massive loss for the sector.

During the first round of violence and curfew, the international clothing retailers and brands expressed concern over the situation as they were facing difficulties in placing work orders with factories and receiving shipments of goods from Chattogram port.

"We mainly discussed the issue of reopening the factories. However, we may take more time to reopen the factories considering the change in the political situation," said BGMEA Vice-President Arshad Jamal Dipu over the phone.

"We want to restart production in the factories very soon. But we need help from the administration for the smooth running of the units as their instructions are important for us," Dipu added.

Also, it recently became difficult to do business and international trade because this is the time to renew bond licences but many, especially the Chattogram-based exporters, are complaining that the customs department is not renewing the bond licences.

Many have been forced to adopt expensive air shipments because of delays in production and transportation of goods to the factories.

Also, many have been forced to provide discounts and accept cancellation of work orders from international retailers and brands because of the latest spells of violence and curfew.

Banks are charging a higher interest rate on loans, he said, adding that all these things are affecting business and all those issues need to be broadly discussed with the trade bodies and administration soon for resolving the issues.

"We have to work seriously now," Dipu also said.

"I hope everything will change now and business will soon be restored," said a garment exporter asking not to be named.

The work orders from international retailers and brands will also be restored soon as normalcy has also started to return, the exporter added.

"We are getting ready to reopen our factories as soon as possible," said a director of the BGMEA asking not to be named.​

 

[Saif]

Yunus urges RMG industry to aid in rebuilding economy

Nobel laureate Muhammad Yunus, chief adviser to the interim government, called on the country’s garment manufacturers on Wednesday to support the rebuilding of Bangladesh after 15 years of economic plunder under the dictatorship of Sheikh Hasina....

www.newagebd.net

Yunus urges RMG industry to aid in rebuilding economy
United News of Bangladesh . Dhaka 14 August, 2024, 20:42

| BSS photo.

Nobel laureate Muhammad Yunus, chief adviser to the interim government, called on the country’s garment manufacturers on Wednesday to support the rebuilding of Bangladesh after 15 years of economic plunder under the dictatorship of Sheikh Hasina.

Speaking to the leaders of the Bangladesh Garment Manufacturers and Exporters Association at the State Guest House Jamuna, Yunus emphasised the challenges inherited by the interim government. ‘All the institutions were broken. We were in a mess. They left us in an economic crisis. But with the cooperation of everyone we can rebuild the nation,’ he said, according to a statement from the Chief Adviser’s Office.

BGMEA acting president Khandoker Rafiqul Islam led the delegation in the meeting, where the Nobel laureate highlighted the urgency of the situation. The country cannot afford to fail, he said. ‘Else, its impact will be disastrous. The nation may face an existential crisis,’ he warned.

Yunus also urged the manufacturers to keep their businesses separate from politics. ‘You should send a clear signal that you won’t mix business with politics. It does not help any cause,’ he advised.

Reflecting on the recent student-led revolution, which he described as ‘unprecedented in human history,’ Yunus noted the responsibility placed on the interim government. ‘They have put their trust in us. I was abroad when they called me and urged me to take up the leadership,’ he shared.

The BGMEA leaders expressed their full support for Yunus’s leadership during this critical time for the nation. They requested the formation of a task force to address sector-specific challenges, aiming to restore international buyers’ confidence in Bangladesh. Their demands included relaxed debt repayment terms and adjustments to utility bill payments.

The chief adviser listened to their concerns and promised to address them. ‘We will ensure transparency at every stage. The Bangladeshi people have immense talents. Bangladesh is the world’s second-largest garment exporter. We want it to grow further,’ he stated.

After the meeting, BGMEA director Shovon Islam spoke to reporters, expressing optimism about the future under Yunus’s leadership. As Yunus took charge of the interim government, buyers across the globe are gaining confidence in Bangladesh, he said. ‘We want to utilise that confidence and increase work orders.’

He also outlined the short-term and long-term needs of the industry, including the formation of a task force to address ongoing challenges. ‘We requested him to form a task force with all stakeholders so that it could play a long-term role,’ Shovon Islam added.

He further mentioned the BGMEA’s need for assistance in securing power and addressing liquidity issues, to which Yunus responded positively. ‘In reply, the chief adviser told us he would help us,’ he confirmed.​

 

[Saif]

Bangladesh’s RMG export to EU drops in Jan-June

Bangladesh’s apparel exports to the European Union in the first half of 2024 declined by 4.98 per cent to 8.72 billion euros compared with those of 9.18 billion euros in in the same period of 2023, according to data from the Eurostat, statistical office of the European Union, released on Saturday...

www.newagebd.net

Bangladesh’s RMG export to EU drops in Jan-June
Moinul Haque 18 August, 2024, 22:40

A file photo shows workers sewing clothes at a readymade garment factory in Narayanganj recently. Bangladesh’s apparel exports to the European Union in the first half of 2024 declined by 4.98 per cent to 8.72 billion euros compared with those of 9.18 billion euros in in the same period of 2023, according to data from the Eurostat, statistical office of the European Union, released on Saturday. | New Age photo

Bangladesh’s apparel exports to the European Union in the first half of 2024 declined by 4.98 per cent to 8.72 billion euros compared with those of 9.18 billion euros in in the same period of 2023, according to data from the Eurostat, statistical office of the European Union, released on Saturday.

Exporters said that global challenges had impacted all major exporting countries, including Bangladesh.

However, Bangladesh has been more severely affected due to the erosion of its competitive advantages, driven by high utility prices, poor gas supply and recent wage hike, they said.

Although the country’s knitwear exports to the EU decreased by 8.58 per cent in January-June of 2024, the shipment of woven garments witnessed a slight increase by 0.28 per cent to 3.74 billion euros from 3.73 billion euros, the data showed.

Fazlul Hoque, former president of the Bangladesh Knitwear Manufacturers and Exporters Association, said that global challenges impacted all major apparel exporting countries.

He said that Bangladesh had been severely affected due to the erosion of its competitive advantages, driven by high utility prices, shortage of gas and wage hike.

Citing the current situation of the country, Fazlul said, ‘Buyers rarely announce their decisions to shift or cancel work orders outright. Instead, they gradually redirect their orders elsewhere to mitigate business risks.’

He said that one of his buyers was scheduled to place an order for the next season at the end of July, adding, ‘I didn’t receive that order, which means it was likely diverted to other destinations.’

However, Fazlul expressed hope that the exports would recover in the coming months if the political situation stabilised.

The readymade garment imports by the EU from different countries in January-June of 2024 fell by 6.03 per cent to 38.47 billion euros compared with those of 40.94 billion euros in the same period of 2023.

Data showed that the overall reduction of 4.98 per cent in Bangladesh’s apparel exports was slightly better than the global average decline of 6.03 per cent in the EU’s apparel imports.

The Eurostat data showed that apparel imports by the EU from China in the first half of 2024 declined by 7.23 per cent to 9.16 billion euros compared with those of 9.88 billion euros in the same period of past year.

Although China remained as the top apparel exporter to the EU in value, the European Union’s official data showed that Bangladesh obtained the top position in exporting knitwear to the 27 nation economic bloc in January-June of 2024.

Bangladesh’s knitwear exports to the EU in in the first half of 2024 stood at 4.98 billion euros while those of China were 4.51 billion euros.

Bangladesh’s woven garment exports to the EU in January-June of 2024 stood at 3.74 billion euros against China’s exports of 4.65 billion euros in the period.

Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association, said that long lead times were a major factor causing Bangladesh to lag behind its competitors.

The ongoing power and gas crises have hindered manufacturers from utilising their full production capacity and created challenges in procuring raw materials on time, leading to delays of additional 20-25 days in producing goods and making shipments, he said.

Hatem also said that Bangladesh had experienced negative growth not only on the EU market but also in the US and UK.

He mentioned that while Export Promotion Bureau data might have showed growth, the reality told a different story.

Apparel imports of the EU from Turkey in the first half of 2024 declined by 10.95 per cent to 4.59 billion euros compared with those of 5.15 billion euros in the same period of 2023, the EU data showed.

India’s RMG exports to the EU in the first half of 2024 fell by 4.53 per cent to 2.32 billion euros compared with those of 2.43 billion euros in the same period of the previous year.

Apparel imports of the EU from Vietnam in January-June of 2024 fell by 6.16 per cent to 1.70 billion euros compared with those of 1.81 billion euros in the same period of 2023.​

 

[Saif]

RMG supply chain disrupted by flood

The country’s apparel makers on Saturday said that the recent flooding had disrupted the readymade garment sector supply chain by submerging the Dhaka-Chattogram highway and sought alternative routes for transportation of goods in time of any natural calamities...

www.newagebd.net

RMG supply chain disrupted by flood
Staff Correspondent 25 August, 2024, 00:16

A file photo shows workers sewing clothes at a readymade garment factory in Narayanganj recently. | New Age photo

The country’s apparel makers on Saturday said that the recent flooding had disrupted the readymade garment sector supply chain by submerging the Dhaka-Chattogram highway and sought alternative routes for transportation of goods in time of any natural calamities.

They urged the government to arrange for exporting containers via the Pangaon port due to the flooding on the Dhaka-Chattogram highway, saying that the alternative route was crucial to meeting export deadlines.

Exporters also recommended using the Mongla Port as a backup to avoid further disruptions at the Chattogram port.

‘There is no doubt that the flooding will impact the timely shipment of readymade garment products, with the transportation through the Dhaka-Chattogram highway remaining suspended. However, we are uncertain about the overall impact this natural calamity will have on our business operations,’ former Bangladesh Garment Manufacturers and Exporters Association president Faruque Hassan told New Age.

Transportation will most likely resume tomorrow or the day after, but exporters will still face delays in meeting lead times, he said.

Faruque expressed hope that buyers would take the situation into account, as the natural calamity is an unavoidable circumstance.

He, however, recommended enabling alternative shipment routes through the Mongla port to avoid any unforeseen disruptions at the Chattogram port.

Faruque also suggested that the Pangaon river port be prepared for sending export containers to the Chattogram port.

Bangladesh Knitwear Manufacturers and Exporters association executive president Mohammad Hatem said that the flood had disrupted the supply chain of the readymade garment sector, with both the shipment and release of containers halted since August 22 due to the Dhaka-Chattogram highway being submerged.

He urged the government to make immediate arrangements for sending export containers to the Chattogram port via the Pangaon port in the River Buriganga so that exporters could maintain export deadlines.

Hatem said that after a month-long disruption caused by the student movement in the country, exporters had just begun clearing the backlog of shipments and releasing import consignments but the sudden flood had created a new challenge, hindering business momentum.

He claimed that global buyers had already begun pressuring suppliers to use air cargo for shipments to ensure timely delivery to their stores.

Hatem mentioned that exporters would have to cover the cost of air freight, which would amount to at least 50 per cent of the total value.

BGMEA president Khandoker Rafiqul Islam said that export and import business through the Chattogram Port was hampered as the Dhaka-Chattogram highway remained submerged.

After a month-long disruption caused by the nationwide student movement, business had just begun to rebound, but the sudden flooding has dealt a new blow, he said.

The BGMEA president hoped that the goods transportation on the Dhaka-Chattogram highway would resume today and that normalcy would soon be restored.​

 

[Saif]

Circular textiles lack policy, Bangladesh forgoes $5b in exports a year: study

The absence of a comprehensive policy framework for circular textiles, which would incentivise the recycling of post-industrial textile waste known as jhut, is causing Bangladesh to forgo $5 billion in potential annual export revenues from recycled textile products, according to a recent study...

www.newagebd.net

Circular textiles lack policy, Bangladesh forgoes $5b in exports a year: study
Moinul Haque 26 August, 2024, 22:28

A file photo shows workers sewing clothes at a readymade garment factory in Narayanganj recently. The absence of a comprehensive policy framework for circular textiles, which would incentivise the recycling of post-industrial textile waste known as jhut, is causing Bangladesh to forgo $5 billion in potential annual export revenues from recycled textile products, according to a recent study. | New Age photo

The absence of a comprehensive policy framework for circular textiles, which would incentivise the recycling of post-industrial textile waste known as jhut, is causing Bangladesh to forgo $5 billion in potential annual export revenues from recycled textile products, according to a recent study.

The study titled ‘Regulatory framework to enable recycling of post-industrial waste (jhut) for the RMG industry in Bangladesh said that to harness its potential for innovation and industrial advancement through the circular economy, Bangladesh’s textile industry must formalise the informal jhut sector, though political economy challenges have impeded an inclusive and just transition.

The study estimated that Bangladesh’s current annual recycling capacity for apparel-grade yarns was between 18,000 and 24,000 tonnes, which represented only about 5-7 per cent of the 3,30,000 to 5,00,000 tonnes of 100 per cent cotton and cotton-elastane waste produced each year.

It said that less than 5 per cent of this waste was upcycled into products like rag rugs, rag dolls, and blankets and a substantial portion — over 55 per cent — was exported to recycling companies worldwide, while the remaining waste was downcycled into stuffing materials for cushions and mattresses, incinerated onsite for energy recovery, or, in negligible amounts, sent to landfills.

The study was jointly conducted by the Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH and H&M under the programme for sustainability in the textile and leather sector.

The report outlined measures and regulatory reforms necessary to establish an effective management framework for jhut aiming to maximise economic, social, and environmental benefits within Bangladesh’s jhut supply chain.

It recommended collaborative stakeholder engagement, protection of workers’ rights and safety, promotion of circular textile economy practices, and capacity building and technology adaptation to transform the jhut sector.

The report also outlined a number of key policy solutions for the informal jhut sector that include improving data availability, transparency and traceability through a national jhut database, introducing industry guidelines for jhut management and recycling standards and revising value-added tax and tariff rules for jhut transactions.

It also suggested providing economic incentives to formalise jhut collection, handling and sorting, establishing central depository systems and cluster-based sorting hubs to promote decent work and social inclusion and enhancing the investment environment for advanced recycling technologies.

Current disposal methods result in severe environmental impacts, such as air pollution, resource depletion, and harmful chemical leaching, which pose significant threats to ecosystems and public health, the report mentioned.

The survey pinpointed key challenges in Bangladesh’s recycling industry including sorting jhut, timely disposal, boosting productivity and minimising waste through improved design.

It also identified potential threats if factory owners implement jhut recycling strategies on their own premises.

Potential threats to jhut recycling include political restrictions, general pressures, increased scrutiny, internal recycling disruptions and intimidation from those benefiting from the status quo.

Faruque Hassan, former president of the Bangladesh Garment Manufacturers and Exporters Association, said that the textile industry in Bangladesh had begun recycling and it would yield very positive results in the near future.

‘We lack core raw materials like cotton and petrochemicals, but strengthening our recycling industry could reduce import costs and create a robust backward linkage industry for the country,’ he said.

Faruque said that sorting jhut was a major challenge due to a lack of trained personnel, though the sector had already provided training to many with support from GIZ and H&M.

He also highlighted the importance of establishing jhut collection points for the industry’s transition, mentioning that the BGMEA proposed this but implementation has been stalled due to political reasons.

‘In the global context, an evolving narrative around sustainability in the textile sector is shaping the operations and strategies of major brands. A pronounced push towards integrating circularity in value chains is evident, with entities such as H&M and GIZ at the forefront of these initiatives,’ the report said.

Regulatory bodies, particularly in the European Union, are moving towards stricter mandates and introducing extended producer responsibility requirements, it mentioned.

The study suggested that this global shift offered Bangladesh a chance to boost trade through sustainability goals and create formal employment by formalising the jhut sector and adopting circular economy models.

To transform the report recommended for the enhanced collaboration among government bodies, manufacturers, non-government organisations and recycling companies is essential for developing sustainable infrastructure, adopting innovative technologies and establishing efficient waste management systems.

It also suggested that enforcing existing labour laws and introducing new regulations are crucial to protecting workers’ rights and safety in the jhut recycling industry, including upholding health and safety standards, eliminating child labour and addressing gender-based issues.

The study also recommended that brands and suppliers should adopt recycled materials in their products to set sustainability standards, reduce waste, boost consumer demand for eco-friendly goods, and drive innovation and market growth for recycled textiles.​

 

[Saif]

Exports fell in FY24 for lower woven, knitwear shipments

Bangladesh’s overall exports fell 4.34 percent year-on-year in FY24 due to lower shipments of ready made garments (RMG), reflecting sluggishness in industrial activities and the economy.

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Exports fell in FY24 for lower woven, knitwear shipments

Bangladesh's overall exports fell 4.34 percent year-on-year in FY24 due to lower shipments of ready made garments (RMG), reflecting sluggishness in industrial activities and the economy.

The country's export receipts amounted to $44.47 billion in the previous fiscal while it was $46.49 billion in FY23, according to data released by the Bangladesh Bank on Tuesday.

The central bank said it compiled the export figures provided by the National Board of Revenue (NBR).

The Export Promotion Bureau (EPB) is yet to publish the export data for the entirety of FY24.

In July, the agency under the Ministry of Commerce informed that it would refrain from updating statistics for three months to ensure accurate reporting.

It decided to do so after the central bank released data on the country's balance of payments (BoP), which showed a $14 billion gap compared to the EPB's statistics.

In the latest BoP, the Bangladesh Bank said export value, which is calculated on a Free on Board (FoB) basis for the BoP, stood at $40.8 billion in FY24, down by nearly 6 percent year-on-year.

When products are shipped on a FoB basis, the liability and ownership of the goods lies with the buyer.

The central bank added that the FoB has been adjusted with shipments from the Export Processing Zones (EPZ) in Bangladesh.

When comparing the FoB data to the export data, a gap of $3.66 billion is seen.

A senior official of the Bangladesh Bank said this is because they don't use the FoB method when counting overall exports.

"That's why there has always been a gap between the export statistics used in BoP and overall exports," the official added.

Khandoker Rafiqul Islam, newly elected president of the Bangladesh Garment Manufacturers and Exporters Association, said their exports to both Europe and the US are in the negative as per internal data.

"Business slowed after the beginning of the Russia-Ukraine war as sluggish demand in the West led to stockpiling of previously shipped goods. So, buyers cut back on purchases," he added.

The export data compiled by the Bangladesh Bank showed that exports of woven garments dropped 5.36 percent year-on-year to $16.86 billion in FY24.

Knitwear, the biggest export earner, accounted for 44 percent of total receipts. However, it also posted a 5.35 percent decline to $19.26 billion.

Islam said buyers usually place orders during the months of July and August, but this time they became cautious due to the political changeover stemming from a recent mass uprising.

"The good thing is that we see development," he said, informing that queries from prospective buyers have increased as their previous stocks have reduced.

"So, if the situation returns to normal, exports will likely become positive this year," Islam added.

Central bank data showed that of the top 10 exporting sectors, only three -- agricultural products, chemicals and plastic -- recorded export growth.

Plastic exports registered the highest growth followed by agricultural items and chemicals.

"The government allowed exports of aromatic rice for some days. This is one of the main reasons that exports of agricultural products grew," said Eleash Mridha, managing director of PRAN Group.

He added that freight costs, which soared in the wake of the Russia-Ukraine war, have gradually declined.

"However, the Red Sea crisis is still affecting shipments. But as global commodity prices remain low, exports may grow this fiscal too," Mridha added.

Home textile exporters saw the biggest fall in shipments at 24 percent followed by leather and leather products at around 12 percent and frozen and live fish at 11 percent.

Exports of home textiles, the fourth largest item in the country's export basket, brought home $782 million in FY24 compared to $1.08 billion in FY23.

Leather and leather products, the third biggest export item, recorded $1.03 billion in export earnings last year. It brought in $1.17 billion in FY23.

Arifur Rahman, general manager of ABC Leather Ltd, said the war affected demand for leather products, especially in Europe. However, the demand in Japan remains unchanged.

Meanwhile, the demand for artificial footwear is rising as they are comparatively cheaper than leather shoes, Rahman added, citing that the price of leather shoes ranges between $18 and $22 whereas a pair of artificial ones costs just $3 to $10.​

 

[Saif]

Army, police to start joint operation tonight to safeguard RMG factories

The Bangladesh Army, police and industrial police will start a joint operation in Savar, Ashulia and Gazipur areas tonight to safeguard the ready-made garment (RMG) industries. Home Affairs Adviser Lieutenant General (retd) M Jahangir Alam Chowdhury has issued such a directive. BGMEA President Kh

thefinancialexpress.com.bd

Army, police to start joint operation tonight to safeguard RMG factories
BSS
Published :
Sep 02, 2024 21:03
Updated :
Sep 02, 2024 21:03

The Bangladesh Army, police and industrial police will start a joint operation in Savar, Ashulia and Gazipur areas tonight to safeguard the ready-made garment (RMG) industries.

Home Affairs Adviser Lieutenant General (retd) M Jahangir Alam Chowdhury has issued such a directive.

BGMEA President Khandaker Rafiqul Islam told reporters after a meeting of the BGMEA and BKMEA with the home affairs adviser this afternoon at the Bangladesh Secretariat.

Earlier today, workers seeking jobs were protesting at Ashulia by blocking the Nabinagar-Chandra and Baipail-Abdullahpur roads, demanding equal employment opportunities for men and women in RMG factories, among other demands.

The workers gathered in front of various factories along the Dhaka EPZ and Baipail-Abdullahpur roads to begin their demonstration for employment this morning.

At one point, the protesting workers placed barricades at various points on the Nabinagar-Chandra and Baipail-Abdullahpur roads.

They started throwing bricks and stones at the factories, causing severe traffic congestion. A good number of factories in the area were forced to declare a holiday amid the protests.

Meanwhile, the industrial police and army members managed to clear the Baipail-Abdullahpur road of barricades.​

 

[Saif]

All RMG factories set to resume operations on Thursday with enhanced security measures

All garment factories across the country will reopen on Thursday, following assurances of enhanced security measures by law enforcement agencies. A coordinated effort involving various security forces, including the army, police, and industrial police, will begin on Wednesday night to ensure the sa

thefinancialexpress.com.bd

All RMG factories set to resume operations on Thursday with enhanced security measures
FE ONLINE REPORT
Published :
Sep 04, 2024 19:32
Updated :
Sep 04, 2024 22:50

All garment factories across the country will reopen on Thursday, following assurances of enhanced security measures by law enforcement agencies. A coordinated effort involving various security forces, including the army, police, and industrial police, will begin on Wednesday night to ensure the safety of industrial zones.

As many as 167 readymade garment factories in the industrial belts of Ashulia, Savar and Gazipur failed to operate on Wednesday due to workers' unrest, mostly instigated by outsiders.

On Tuesday, at least 126 garment factories suspended operation while another 100 were forced to close on Monday over unrest.

Bangladesh Garment Manufacturers and Exporters Association President Khandoker Rafiqul Islam made the announcement at a press conference held on Wednesday at the trade body's headquarters in Uttara in the city.

Before the conference, the BGMEA leaders held a meeting with factory owners and top officials from law enforcement agencies.

Former BGMEA presidents AK Azad, Dr Rubana Huq, Anwarul Alam Chowdhury, Anisur Rahman Sinha, Kutub Uddin Ahmed and Gulam Quddus, among others, were also present during the meeting.​

 

[Saif]

RMG export to US falls in Jan-July

Bangladesh’s apparel exports to the United States in January-July of 2024 witnessed a significant fall both in value and volume while the other competing countries, such as China and Vietnam, performed well in the market...

www.newagebd.net

RMG export to US falls in Jan-July
Staff Correspondent 05 September, 2024, 22:37

A file photo shows workers sewing clothes at a readymade garment factory in Narayanganj recently. Bangladesh’s apparel exports to the United States in January-July of 2024 witnessed a significant fall both in value and volume while the other competing countries, such as China and Vietnam, performed well in the market. | New Age photo

Bangladesh’s apparel exports to the United States in January-July of 2024 witnessed a significant fall both in value and volume while the other competing countries, such as China and Vietnam, performed well in the market.

The country’s apparel exports to the US, the largest export destination for Bangladesh, declined by 10.27 per cent to $4.10 billion in the first seven months of 2024 compared with that of $4.57 billion in the same period of 2023, according to the data released by the Office of Textiles and Apparel under the US Department of Commerce.

In terms of volume, Bangladesh exported 1.33 billion square metres of apparel from January to July period of 2024, a 4.55-per cent decrease from 1.39 billion square metres exported during the same period of the previous year.

Exporters said that the US buyers decreased their orders in Bangladesh due mainly to long shipment time.

Due to a shortage of gas and electricity, as well as complexities in banking and customs procedures, the shipment of export goods has been delayed, they said.

Negative growth in apparel export earnings from the US market persisted, as the underlying issues remained unresolved, Bangladesh Knitwear Manufacturers and Exporters Association president Mohammad Hatem told New Age on Thursday.

He said that the persistent shortages of gas and electricity, combined with the complexities of opening letters of credit with banks and delayed customs procedures, were continuing to cause shipment delays and adversely affected overall export performance.

Hatem, however, hoped that the apparel exports to the market would get momentum in the coming months as the interim government was working to improve the situation.

The OTEXA data showed that overall US apparel imports declined by 4.65 per cent to $43.63 billion in the first seven months of 2024, down from $45.76 billion in the same period of 2023.

Apparel imports by the US from China in January-July period of 2024 declined by 4.22 per cent to $8.76 billion from $9.14 billion in the same period of the previous year.

Vietnam’s apparel exports to the US totalled at $8.09 billion in the first seven months of 2024, reflecting a 1.54-per cent year-over-year decrease, according to the data.

The OTEXA data, released on Wednesday, showed that Bangladesh’s position remained unchanged as the third-largest apparel exporter to the US market with 9 per cent share while China and Vietnam occupied the first and the second highest positions with 21.09 per cent and 18.54 per cent share respectively.

The OTEXA data revealed that the US apparel imports from Cambodia grew by 5.96 per cent to $1.91 billion in January-July 2024 compared with that of $1.8 billion in the same period in 2023.

In the first seven months of 2024, India’s readymade garment exports to the US market decreased by 2.21 per cent to $2.85 billion.

Meanwhile, Indonesia saw a decline of 7.86 per cent, with exports totalling at $2.28 billion during the same period.​

 

[Saif]

RMG work orders shifting to India amid unrest in BD

A latest spate in labour unrest in Bangladesh's readymade garment factories prompted global apparel brands to shift work orders to neighbouring India. The unrest follows Sheikh Hasina government's fall in a student movement. Factory owners and labour leaders allege that the unrest, apparently cre

thefinancialexpress.com.bd

RMG work orders shifting to India amid unrest in BD
Monira Munni
Published :
Sep 06, 2024 09:21
Updated :
Sep 06, 2024 09:21

A latest spate in labour unrest in Bangladesh's readymade garment factories prompted global apparel brands to shift work orders to neighbouring India.

The unrest follows Sheikh Hasina government's fall in a student movement.

Factory owners and labour leaders allege that the unrest, apparently created at the instigation of outsiders, has forced hundreds of their units to close for the last couple of days.

As a result, the buyers were reportedly shifting their orders to India, they said.

In addition to the closed ones, hundreds of garment factories suspended their operations for the last four days, beginning from Monday over the worker protests.

The Economic Times of India on Thursday reported that the Tiruppur knitwear export hub has swung export orders worth 4.50 billion rupees in the last two weeks from Bangladesh due to the political unrest there.

Quoting KM Subramanian, president of Tirupur Exporters' Association (TEA), it also noted that global apparel brands like KiK from Germany, Zeeman from Netherlands, and Pepco of Poland, among others, placed orders to be delivered before the Christmas and New Year and the average price of the garment ordered is to the tune of $3.0 per piece.

According to another report by Times of India, Raymond Ltd Chairman and Managing Director Gautam Singhania said on Tuesday last that the company has been receiving "massive inquiries" for garments supply after the political crisis erupted in Bangladesh over the last two months.

"Bangladesh has no fabric capacity... Fabric goes from India to Bangladesh. With the current crisis in Bangladesh, if a customer comes to us, we are giving them integrated supply, both the fabric and the garment, thus saving time.

"The perception has changed against Bangladesh. This is the time when we are getting massive inquiries. We invested 2.0 billion rupees last year to increase our capacity, which has come online and is available," the report quoted Singhania.

Global Data, a leading data and analytics company, on August 19 revealed that the ongoing political and economic instability in Bangladesh, a global hub for textile and apparel manufacturing, became the focal point of discussion among the industry experts and influencers on social media platform "X".

Influencers highlight that the disruption in Bangladesh's textile sector offers India a chance to capitalise on the potential shift in global apparel manufacturing.

They believe India's market share in apparel exports could increase as global brands seek to diversify their supply chains, revealed the Social Media Analytics Platform of Global Data.

GlobalData's Social Media Analytics Platform captured a few popular influencer opinions in this regard.

"Someone's crisis is someone else's opportunity. Bangladesh has been a major exporter of textiles. Now that Bangladesh is going through huge instability, India should make use of the opportunity to bring that business to our country. More so, Tamilnadu should use this opportunity as the state with the number one share of textile exports," GlobalData statement quoted D Muthukrishnan, a certified financial planner.

"India's market share in apparel exports has been 3.0 per cent for a long time. Disruption in Bangladesh along with wage revision is making global labels think of diversification… Lot of Indian companies could be benefitted inking term," it quoted Gurmeet Chadha, chief investment officer at Complete Circle Wealth.

"Bangladesh's loss (textiles) will be Bihar's gain," said Saurav Jha, founder and director of Delhi Defence Review.

Prashant Nair deputy executive editor at CNBC-TV18 was quoted as saying: "A quick point on textile stocks rallying - while the Bangladesh situation may benefit Indian mills. I reckon it will be a temporary bump. Textile exports are Bangladesh's mainstay. Whoever takes charge won't let it slip."

Shreyasee Majumder, Social Media Analyst at GlobalData, commented: "Influencers express a mix of optimism and caution regarding the potential benefits for India's apparel industry amid the Bangladesh's textile sector disruptions."

There is a widespread perception that this is a promising short-term opportunity, predicting a rally in textile stocks and an increase in India's market share, she said.

Many believe that Bangladesh, given the critical importance of textiles to its economy, will prioritise restoring its industry, potentially reclaiming its position sooner than anticipated, she added.​

 

[Saif]

RMG unrest will hurt exports and industrial output

Govt must prevent further disruptions, minimise damage

www.thedailystar.net

RMG unrest will hurt exports and industrial output
Govt must prevent further disruptions, minimise damage

VISUAL: STAR

We are concerned about the outcome of recent disruptions in the ready-made garments (RMG) industry. This vital sector—which last year fetched an all-time high of about $47 billion from exports—could be in for a rude shock this year after being rocked by frequent protests, factory closures, and vandalism over the past month or so. This is already having an impact, with many international buyers who regularly visit Bangladesh to finalise work orders cancelling their trips, affecting their planning for upcoming seasons. Citing a representative of a major European buyer, a report by this daily even said that many requests for value-added garments have already been cancelled or postponed.

In an environment of uncertainty and insecurity, it is natural that buyers would have a Plan B for sourcing apparel from alternative destinations where they can safely place orders. As well as supply-chain disruptions, buyers also have to think about reputational risks arising from placing orders in restive countries. There is already a concern among some buyers that about 5 to 10 percent of their work orders placed in Bangladesh could be affected by the latest unrest and other hurdles. What this means for local producers is that they are having to deal with concerns not just about future orders but also the profitability of existing ones, as they may now have to provide discounts and expensive air shipments because of supply delays.

Ironically, the problems in Bangladesh have raised hopes for rival apparel suppliers, including India, who are expecting a boost in their work orders. Even though India's apparel exports remain significantly lower than Bangladesh's, the country's offer of various incentives and policy supports to its garment hubs and manufacturers contrasts the frequent challenges facing our manufacturers. This shows how our position as the world's second-largest garment exporter could be upended if we don't ensure stability and competitiveness fast enough. True, Bangladesh can still turn around. Its competitive pricing, improved safety and environmental compliance, and increased capacity for diversified products are still a potent mix. But to prevent the recent incidents of work orders being shifted elsewhere from becoming a trend, we must significantly improve safety, support our manufacturers, and remove all hurdles in the supply chain.

A lot has been said about the recent protests by workers. At a recent press conference, the IndustriALL Bangladesh Council, which represents 18 trader unions, blamed local youth gangs, garment waste traders, and unemployed individuals for instigating the demonstrations in Savar, Ashulia, and Gazipur. Going forward, we must approach these disruptions in a manner that both addresses the genuine grievances of workers—including delayed wage payments and unlawful dismissals—and persistent security issues. The interim government has reportedly set a 12.65 percent export growth target for this fiscal year, but without fixing the problems in our biggest export sector, such targets cannot be reached successfully.​

 

[Saif]

We must stop the infighting to retain buyers

To maintain its position as a global leader in the garment industry, Bangladesh must prioritise unity and stability.

www.thedailystar.net

We must stop the infighting to retain buyers

A female worker inquires at the gate of a closed factory in Ashulia when it would reopen. FILE PHOTO: AKLAKUR RAHMAN AKASH

Bangladesh has been through an extremely challenging situation recently, especially with the change of leadership brought forth by a student-led mass movement. As a business community, we should now be looking forward to the coming months with a sense of optimism. For the ready-made garment (RMG) sector, this is a crucial period as apparel manufacturers look to complete autumn and winter orders.

Therefore, it is frustrating to see that pockets of unrest continue, leading to closures of garment factories, which are already under tremendous pressure of completing their work orders. This is taking place at a time when the nation is facing numerous economic challenges. When foreign exchange reserves are a big concern, creating trouble in the garment sector will deal a heavy blow to the economy and the country as a whole.

The recent labour unrest in garment factories of Dhaka's Ashulia and Gazipur has been attributed to a power struggle between local thugs with differing political allegiances. Some ringleaders are allegedly attempting to assert dominance after the regime change and their rivalry has intensified the unrest.

According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), the protests began at the Dhaka EPZ gate, where demonstrators demanded jobs. The unrest spread to nearby factories, although initial impacts were minimal.

On August 31, workers from a major exporter began vandalising factories, according to industry insiders, workers, and law enforcement reports. They forced other factory owners to close their factories and urged workers to join the protests. Violence erupted as owners and workers resisted the shutdown, resulting in more vandalism. Some unrest has persisted since then, with some factory closures. Garment manufacturers have held separate meetings with government officials and law enforcement agencies since then.

Industry insiders believe the police should ensure factory security, but some officers were involved in violent crackdowns during the student uprising, which may have left them feeling hesitant to confront workers. Although the Bangladesh Army has been deployed nationwide, it is more challenging for them to manage the situation without sufficient police support.

So, what now? My personal perception is that global apparel buyers have faith in the Yunus-led government, and orders continue to be placed. However, it is frustrating to see that a vested group is attempting to further destabilise the garment sector.

Moreover, these ongoing tensions between political factions in Bangladesh pose a significant threat to Bangladesh's reputation, especially at a time when it must present a unified and stable front to retain the trust of international fashion buyers.

The RMG sector, which accounts for over 80 percent of Bangladesh's export earnings, is the backbone of the nation's economy. Any instability in this industry directly impacts not only the livelihoods of millions of workers but also the broader economic prospects of the country. For global fashion brands, who rely on consistency, reliability, and timely delivery from suppliers, such infighting sends the wrong message.

Political unrest, labour strikes, and factory closures signal an unpredictable business environment. International buyers, operating in a highly competitive market with tight deadlines, cannot afford disruptions in their supply chains.

This does not bode well for Bangladesh, especially when other nations such as Vietnam, India, and Cambodia, are emerging as competitors in the global garment industry. These countries present themselves as stable, reliable alternatives, further exacerbating Bangladesh's challenges in maintaining its market share. Infighting within the RMG sector weakens the industry's competitive edge by diverting attention away from productivity and innovation and toward internal strife. The situation is particularly concerning given the country's dependence on international buyers, many of whom have voiced their support for ethical and sustainable sourcing practices.

To maintain its position as a global leader in the garment industry, Bangladesh must prioritise unity and stability. The government, industry leaders, and political factions must work together to create an environment conducive to business, signalling to the world that Bangladesh is a trustworthy and dependable partner. If the country fails to present a unified voice, it risks losing the confidence of global buyers, leading to devastating economic consequences for millions of workers and the nation as a whole.

In the past few weeks, buyers, NGOs, and rights groups have urged fashion brands to stand by Bangladesh amid its change of leadership. But we must repay this loyalty by providing a stable and reliable business environment. Major customers are supportive of our efforts but there is only so much they will tolerate before saying: enough.

Mostafiz Uddin is the managing director of Denim Expert Limited. He is also the founder and CEO of Bangladesh Denim Expo and Bangladesh Apparel Exchange (BAE).​

 

[Saif]

Textile millers want immediate improvement in gas supply

Textile millers yesterday urged the interim government to take immediate steps to improve gas and power supply to production units, as most are now running at only 30 percent capacity.

www.thedailystar.net

Textile millers want immediate improvement in gas supply

Textile millers yesterday urged the interim government to take immediate steps to improve gas and power supply to production units, as most are now running at only 30 percent capacity.

They also urged the authorities to restore law and order urgently as garment factories are facing challenges in running operations.

They demanded that yarn imports from India be stopped through all land ports as large quantities are entering without proper documentation and quality testing, deteriorating sales of the domestic primary textile sector, where $22 billion has been invested.

The millers said yarn imports can be allowed through the Chattogram port as it contains facilities for quality testing.

They also urged to stipulate that any yarn which is sought to be imported from India needs to undergo quality tests at the Bangladesh University of Engineering and Technology.

In most cases, double the quantity mentioned in letters of credit is being imported through misdeclarations, said leaders of the Bangladesh Textile Mills Association (BTMA) at a press conference at its office in Dhaka.

Over the last eight months, textile millers at Bhulta, Gausia, Rupganj and Narayanganj areas have been suffering a lot because of low gas pressure in the supply lines, said BTMA Vice-President Md Saleudh Zaman Khan.

The textile mills are being run with alternative fuels such as diesel, methane-based compressed natural gas and liquified petroleum gas, which is composed of propane, butane, propylene, butylene, and isobutane, he said. This is also increasing the cost of production.

The mills are running at only 30 percent capacity and falling behind in competition with Indian companies as the latter get adequate gas supply alongside government incentives, he added.

Moreover, gas prices in Bangladesh have been hiked by over 400 percent in the past 2-3 years, he said.

BTMA President Showkat Aziz Russell said they have already written to Muhammad Yunus, chief adviser to the interim government, to review whether Bangladesh is truly qualified to make the United Nations country status graduation from a least developed country to a developing nation in 2026.

This is because, during the tenure of the last government, state data miscalculations led to export figures being inflated by around $14 billion to nearly $48 billion in fiscal year 2022-23, he said.

He also urged banks to provide loan rescheduling facilities as businesses suffered due to political unrest over the past two months.

Moreover, the interim government should provide incentives to the primary textile sector to make the domestic industry more competitive, he added.

Russell hoped for improvements in the law and order situation, saying it was especially necessary for the smooth operation of garment factories. He and other BTMA members accused "outsiders" of recent vandalism at garment factories.

The BTMA leaders said no textile mill had been attacked so far, although hundreds of garment factories have been facing trouble for labour unrest over different demands.​

 

[Saif]

Why this labour unrest in RMG sector?

The ongoing labour unrest since August 29, which has led to several factory closures across the industrial hubs of Ashulia and Gazipur, has brought the lucrative Bangladesh readymade garment (RMG) sector to a critical crossroads, sending warning signals to buyers throughout the world. This turmoil

thefinancialexpress.com.bd

Why this labour unrest in RMG sector?
Atiqul Kabir Tuhin
Published :
Sep 11, 2024 22:18
Updated :
Sep 11, 2024 22:18

The ongoing labour unrest since August 29, which has led to several factory closures across the industrial hubs of Ashulia and Gazipur, has brought the lucrative Bangladesh readymade garment (RMG) sector to a critical crossroads, sending warning signals to buyers throughout the world.

This turmoil follows a period of political instability in July, from which the industry was hoping to recover after the formation of the interim government on August 8. However, the unrest, marked by attacks, property damage, looting, and arson in various factories, has raised concerns about industrial security. This disruption comes at a time when factories are under contract and immense pressure to meet deadlines for winter orders from global buyers, further exacerbating the crisis.

The reasons behind the unrest are the subject of much debate. The demands voiced by garment workers include equal opportunities for men and women, increased wages, improved benefits, and lighter workloads. In addition, delays in wage payments, alleged blacklisting of dismissed workers, and contentious issues surrounding unionisation have fuelled anger and dissatisfaction. Factory owners, on the other hand, claim the unrest is not primarily driven by the workers but by external elements, particularly political groups seeking dominance, especially over the scrap and rejects business. These groups, they argue, have incited disturbances to exert pressure on factory owners. A lack of adequate police presence has allowed the unrest to escalate and spread rapidly, presenting a grave threat to industrial peace and stability.

To quell the unrest, on September 2 the government deployed the army and police. While this intervention has restored some degree of order, the situation remains volatile and fragile, with approximately 100 factories in the Ashulia industrial zone alone forced to close on September 9 due to continued violent protests. This highlights that security measures alone cannot resolve the underlying grievances of the workers. There is an urgent need for factory management to engage in meaningful dialogue with the workers to address legitimate demands, as unrest in one factory can easily trigger a wave of disruptions across the sector.

This labour unrest, though seemingly localised, has far-reaching implications for both the economy of Bangladesh and the international reputation of its RMG sector. As the country's economic cornerstone, the garment industry contributes hugely as in 2023 it fetched over $47 billion from exports. Any prolonged disruption threatens not only the livelihoods of millions of workers but also the nation's macroeconomic stability. Bangladesh, as the world's second-largest garment exporter, faces intense global competition, particularly during peak seasons. Reports of international buyers diverting their orders to Cambodia, Indonesia, and elsewhere due to the instability should serve as a wake-up call for both the government and industry leaders.

Additionally, the unrest has diverted attention from other critical issues, such as energy shortages affecting the RMG sector as well as its backward linkage industries. The failure to address these challenges promptly will have ripple effects throughout the economy, exacerbating the difficulties already faced by the RMG sector.

The interim government, led by Nobel laureate Muhammad Yunus, has pledged to restore order and undertake necessary reforms. However, the urgency of stabilising the situation quickly cannot be overstated. Bangladesh's low-cost labour, while a competitive advantage, is insufficient to offset the risks associated with an unstable political environment. Restoring the confidence of international buyers will require more than security measures - it demands a comprehensive strategy that tackles the root causes of unrest, including workers' rights, governance, and corruption.

The sector should prioritise not only meeting international demands but also ensuring fair treatment of its workforce and bolstering security and governance in industrial zones. Failure to address these concerns risks deepening the current crisis, threatening not just the RMG industry, but also the entire economy.

The challenges facing the interim government are monumental. Political stability and law and order need to be restored swiftly if Bangladesh is to retain its standing in the global garment industry. The administration must collaborate closely with industry leaders to ensure that production timelines are met and that necessary governance reforms are implemented. Restoring the country's reputation as a reliable garment producer ought to be a top priority.

Moreover, the government should tackle the underlying issues that have plagued the sector for years, particularly corruption and political entanglement. While factory owners may have benefitted from political patronage in the past, these connections have now become liabilities. Reforming trade associations and ensuring transparency in business practices would go a long way towards restoring credibility in Bangladesh's garment sector.

Bangladesh's RMG industry stands at a pivotal juncture, facing both opportunities and challenges, especially as the country approaches graduation from its Least Developed Country (LDC) status. To thrive in the future, the industry will need to diversify its product range, embrace innovation, invest in technological upgrades, and enhance workforce skills. Collaboration among workers, factory management, and government remains essential to overcoming these challenges and sustaining the sector's growth.

Resolving disputes through dialogue could create a win-win situation for all stakeholders in the RMG industry. Positive relationships between workers and employers are crucial for fostering an environment of trust and mutual respect. This, in turn, will motivate workers and contribute to the sector's growth. By fostering a harmonious industrial environment, Bangladesh's RMG industry can navigate its current challenges and continue to play a crucial role in the country's economic development. The time for decisive action is now, and all stakeholders need to rise to the occasion.​

 

[Saif]

Deeper crisis feared as 219 factories shut

With 219 garment factories shut in Ashulia yesterday amid worker unrest along the industrial belts, Bangladesh’s apparel sector is feared to get into a deeper crisis if production does not resume on Saturday after the weekend.

www.thedailystar.net

Deeper crisis feared as 219 factories shut

With 219 garment factories shut in Ashulia yesterday amid worker unrest along the industrial belts, Bangladesh's apparel sector is feared to get into a deeper crisis if production does not resume on Saturday after the weekend.

Officials see conspiracies behind the unrest and believe "real workers" are not involved in the vandalism of some factories, while labour leaders blame the influence of partisan politics and control over fabric scrap trade for the situation.

Meanwhile, the inaction of a demoralised industrial police force and the "unusual demands" of the workers have frustrated the owners, who are under pressure from international buyers ahead of the next holiday season in the West.

Of the factories closed yesterday, 86 were shut indefinitely under the Labour Act, which empowers the employer to shut any unit in case of a strike.

The remaining 133 factories were closed as they declared a general holiday, said Md Sarwar Alam, superintendent of Ashulia Industrial Police-1.

The closed factories included 107 members of the Bangladesh Garment Manufacturers and Exporters Association, mainly in Ashulia and Zirabo, said Khandoker Rafiqul Islam, president of the association.

Although a few committees involving local politicians were formed in Ashulia to resolve the crisis through discussions, industry owners are worried about the safety of their factories, he said.

Industrial police have yet to start fully functioning more than one month after the ouster of the Awami League government, further fuelling safety concerns. Harsh measures like internet shutdown amid street protests during the mass uprising already hampered production and orders heavily.

Owners say they are not getting help from the industrial police even after lodging complaints. The number of personnel patrolling the industrial zones is inadequate.

Army personnel have been deployed to the industrial zones, but they do not have the magistracy powers to arrest protesters, said Shams Mahmud, managing director of Shasha Denims.

"We aren't getting the confidence to run the factories because of safety concerns," Mahmud told The Daily Star over the phone.

Foreign buyers are putting pressure for timely delivery but the factories are shut, said a frustrated Mahmud. Many shipments may get cancelled, or the buyers may demand big discounts or expensive air shipments, he added.

Many international retailers and brands are cancelling buying trips because of the unrest although this is the peak time to confirm work orders for the next winter season, exporters said.

"So, a massive impact of the unrest will be noticed in the next winter season," Mahmud said.

A senior officer of the industrial police, requesting anonymity, said they are conducting joint patrols in the industrial zones and responding to incidents. Industrial police are trying to be fully functional, the officer added.

AK Azad, chairman and CEO of Ha-Meem Group, echoed the views of Mahmud. He said most of the incidents were taking place in Ashulia and local groups were involved.

Police are not working, which is helping the unrest in one factory to spread to the others, said a garment exporter based in Narayanganj's Rupganj who asked not to be named.

In some cases, political issues are also involved, the exporter said.

For instance, he said, the unrest in the Beximco garment factory has political influence as one of its owners, Salman F Rahman, was an adviser to ousted prime minister Sheikh Hasina.

He also said that buyers, worried and frustrated over the situation, are sending a lot of queries to know about the condition of work orders for the next season.

Giant Group Managing Director Faruque Hassan claimed the ongoing unrest is not about wages because the pay was hiked in December last year.

In many cases, the workers are demanding the removal of senior officials, equal ratio in appointment of male and female workers, he said.

The workers are placing "unusual demands" in some cases, said Md Saleudh Zaman Khan, vice-president of Bangladesh Textile Mills Association.

For example, he said, protesters demanded the recruitment of 300 workers when a factory in Narayanganj needed only 20. The factory management decided to hire a little over 20 workers, but the protesters did not return to work, Zaman said.

Worker leaders pointed the finger at partisan politics and conflict in fabric scrap trade for the unrest. They said a section of fabric scrap traders were trying to maintain control by using the workers.

Many are taking advantage of weak law and order, said Md Towhidur Rahman, president of the Bangladesh Apparel Workers Federation.

If the factories do not reopen fully on Saturday, the sector may face a deeper crisis in near future, he said.

Nazma Akter, president of Sammilito Garment Sramik Federation, said many workers are also involved in partisan politics. In some cases, outsiders are instigating them to launch unrest, she said.

She recommended holding a dialogue among the stakeholders to find a way out of the crisis.

Labour and Employment Secretary AHM Shafiquzzaman believes those involved in the vandalism of factories are not real workers.

The secretary said he held a meeting with BGMEA leaders and union leaders at Tongi yesterday as part of measures to improve worker-owner relations.

Asif Mahmud, youth and sports adviser to the interim government, suspects a conspiracy behind the ongoing unrest in the garment sector.

Speaking at a media briefing at the Foreign Service Academy yesterday, he said that around 20 percent of total orders have been cancelled.

"And we have witnessed that the buyers of a certain country have been desperately lobbying to get those orders," he said, citing Secretary Shafiquzzaman.

Asif said that workers prevented attacks on factories by a group called Bekar Jubo Songho, or Unemployed Youth Association, and one leader of the association arrested in Netrokona was found to be involved with AL's student front Chhatra League.

He admitted that the protesting workers have some genuine demands besides the conspiracies.

The adviser also warned of strict action against fabric scrap traders who are fuelling the unrest.​

 

[Saif]

Authorities must immediately address apparel sector unrest

THE ongoing labour unrest in the apparel sector that has led to the shutdown of more than a hundred factories is gravely concerning for owners and employees in the sector and the economy. The unrest at a time when fresh orders come aplenty is feared to have a lasting negative impact on the...

www.newagebd.net

Authorities must immediately address apparel sector unrest
13 September, 2024, 00:00

THE ongoing labour unrest in the apparel sector that has led to the shutdown of more than a hundred factories is gravely concerning for owners and employees in the sector and the economy. The unrest at a time when fresh orders come aplenty is feared to have a lasting negative impact on the sector. September and October are crucial for the sector as most western buyers place orders in these two months targeting Christmas. Any disruption now in the sector, one of the pillars of the economy, will give benefits to Bangladesh’s competitors, which naturally eye to seize the market. Labour unrest shut down, as New Age reported on September 11, 114 factories in Ashulia and Gazipur industrial areas. Workers of several factories in the Beximco Industrial Park in Gazipur on September 11 went on demonstration demanding their wage for August and tried to mobilise workers of other factories, leading to a clash. About 32,000 workers in the Beximco Industrial Park had rallied for their overdue wage for August and although the authorities issued payment on September 10, many workers did not receive the wage. The workers also burnt a factory in Kashimpur after a clash between two worker groups.

In the wake of the unrest that has continued for a few days, at least 60 factories announced a paid general holiday while 54 units announced closure for an indefinite period. It is feared that about 100,000 workers might get laid off if the shutdown continues and if work orders do not come. Factory owners have, meanwhile, alleged that the unrest is created by outsiders and is politically motivated. While the allegation appears a typical response of owners, it bears some truth as a leader of the Chhatra League, the student wing of the Awami League, was arrested on September 8 after a provocative speech in front of apparel workers at Savar had gone viral. This suggests that the unrest might be, to some extent, politically motivated and outsiders, local or foreign, might have attempted sabotage. The authorities certainly need to examine the allegation and assess the situation. But at the same time, the authorities need to address the labour rights issue that continues to be a cause for concern. Bangladesh cuts a sorry figure when it comes to labour rights. The Global Rights Index has ranked Bangladesh among the 10 worst countries for workers for consecutive years since 2017.

The government needs to address the issue efficiently, effectively and immediately to bring stability in the sector. The authorities must provide security for industrial areas and investigate whether the unrest is an act of sabotage. The authorities, however, should by no means be high-handed to workers and heed genuine grievances of the workers. The labour unions also need to come forward and help bring stability in the sector.​

 

[Saif]

130 factories remain open in Ashulia on weekend

A total of 130 factories in the Ashulia industrial area, where there is no worker unrest, remained open today despite the usual weekly holiday, due to pressure from work orders

www.thedailystar.net

130 factories remain open in Ashulia on weekend

Photo: Palash Khan/File

A total of 130 factories in the Ashulia industrial area, where there is no worker unrest, remained open today despite the usual weekly holiday, due to pressure from work orders.

Md Sarwar Alam, superintendent of Ashulia Industrial Police-1, confirmed the matter to our Savar correspondent this noon.

He said that there are a total of 1,863 factories in the Ashulia industrial area, most of which are garment factories. Due to heavy work order pressure, production continued today in 130 factories, mostly garment factories.

"In these factories, there are no issues with the workers, and due to the high volume of work orders, the owners decided to continue production even on holidays," said SP Sarwar Alam.

SP Sarwar Alam said the decision to keep some factories open during the holidays was made by the owners to compensate for the losses caused by recent worker protests. About 30 percent of the total factories in Ashulia area operated today.

He further said additional law enforcement personnel were deployed in front of the factories to prevent any untoward incidents.

Worker unrest has been ongoing in the Ashulia industrial area for the past two weeks due to various worker demands.

Yesterday, a total of 219 garment factories were declared shut in Ashulia Industrial area so far today due to the labour unrest. Of these, 86 factories were shut by the authorities for indefinite period under Section 13 (1) of the Labour Act, and the remaining 133 factories remained closed as they declared a general holiday.

However, the 219 factories that were closed yesterday remain closed today.​

 

[Saif]

Bring back normalcy in the RMG sector

Understand and act to calm the frustrations in industrial belts.

www.thedailystar.net

Bring back normalcy in the RMG sector
Understand and act to calm the frustrations in industrial belts

VISUAL: STAR

We are gravely concerned about the ongoing unrest in our RMG industry as workers continue to protest in Ashulia, Zirabo, Savar and Gazipur over payment of arrears, better pay, job regularisation, increase of allowances and benefits, etc. According to the BGMEA, on September 12 alone, 219 garment factories in Gazipur and Ashulia were closed down due to workers' protests. Reportedly, in many areas, the protests took a turn for the worse as a result of unresolved negotiations with factory owners over their demands. Workers allegedly vandalised many factories; some of them were also set on fire. The question is: how has the situation come to this point?

According to industry insiders as well as some labour leaders, outsiders and political elements are trying to instigate the workers. It is imperative that, under the circumstances, a proper investigation is conducted immediately to identify the external factors responsible for the vandalism and destruction of properties. Owners have also pointed out that the industrial police are yet to start functioning fully in the industrial belts since the Hasina government was ousted around six weeks ago, fuelling safety concerns. This prolonged state of insecurity must be addressed by the interim government urgently, and the role of the industrial police—who have been used by successive governments to quell workers' protests—must also be re-evaluated to restore trust in the force.

Even if the allegations of external forces trying to create instability in the sector are true, we need to understand and address the underlying frustrations of the workers. During the 15 years of Awami League rule, we saw how the workers' legitimate demands were routinely disregarded. Last year, when the workers demanded Tk 23,000-25,000 as their monthly minimum wage, the government fixed it at Tk 12,500 in compliance with the proposal made by RMG factory owners. Sadly, many owners are still depriving their workers of their dues and aggravating an already volatile situation. Meanwhile, RMG factories are yet to institute an equitable mechanism for negotiations between workers and owners. Such practices must come to an end and workers' grievances must be properly addressed.

As production in a lot of factories remains suspended, there are concerns among the owners about financial losses they might incur, which will eventually affect our economy and the workers at large. There are, in fact, real reasons to worry as the disruption in production has already led many international buyers to cancel their trips to the country to finalise work orders for the coming seasons. Under the circumstances, we urge the interim government to act promptly to understand and act on the simmering frustrations on the ground. Its decision to review the workers' wage through the minimum wage board is a step in the right direction. The government also said it would consider inflation and the rising prices of essentials while reviewing the minimum wage, which is only the right thing to do. It also needs to take steps to improve security at the RMG factories, support the manufacturers in need, address the international buyers' concerns, and ensure stability and competitiveness in the sector.​

 

[Saif]

Labour situation in RMG sector improves

The labour situation in the readymade garment sector in Ashulia and Gazipur industrial areas improved on Sunday while fresh unrest occurred in the Dhaka metropolitan area on the day...

www.newagebd.net

Labour situation in RMG sector improves
Staff Correspondent 16 September, 2024, 00:09

Representational image. | New Age file photo

The labour situation in the readymade garment sector in Ashulia and Gazipur industrial areas improved on Sunday while fresh unrest occurred in the Dhaka metropolitan area on the day.

Leaders of the Bangladesh Garment Manufacturers and Exporters Association said that most of the RMG factories in Ashulia resumed operations on Sunday, and the situation remained nearly normal throughout the day.

They also said that all the factories in Gazipur were operational and that no untoward incidents occurred.

However, production was suspended in at least 15 factories in the Dhaka metropolitan area on Sunday due to the fresh labour unrest.

According to the BGMEA, out of 407 member factories in Ashulia, only 16 units remained shut due to the unrest.

Of the 16 factories, 6 were closed under Section 13/1 of the Bangladesh Labour Act, 4 declared a general holiday, and workers at the remaining 6 factories declined to work after arriving in the morning.

Ashulia Industrial Police superintendent Mohammad Sarwar Alam told New Age that the labour situation in the Ashulia industrial belt improved on Sunday, with production resuming in almost all the RMG factories.

He said that a total of 18 BGMEA and BKMEA member factories remained closed under Section 13/1 of the Bangladesh Labour Act, while authorities at 4 factories declared a general holiday.

BGMEA statistics showed that all 876 member factories of the trade body resumed operations on Sunday morning and did not encounter any issues throughout the day.

According to the BGMEA data, authorities at 15 factories in Mirpur area in the city on Sunday forced to announce closure of their units due to the labour unrest.

More than hundred factories in the Savar, Ashulia, and Gazipur industrial belts, particularly in Ashulia, have struggled to operate for over two weeks due to the ongoing worker protests.

The workers have been demanding increased attendance and tiffin allowances, the removal of certain mid-level employees, the recruitment of more male workers, and an end to the blacklisting of workers involved in last year’s wage hike protests.

On Saturday, the government, factory owners and labour leaders held a meeting at BGMEA headquarters in the city to overcome the situation.

During the meeting labour leaders assured that they would provide support to continue production in the readymade garment sector.

Trade union leaders also urged garment workers to return to their respective workplaces immediately in an effort to restore normalcy and prevent further disruptions.

At the meeting industries adviser Adilur Rahman Khan urged factory owners to keep their factories open, warning that troublemakers in any individual unit would be dealt with strict measures.​

 

[Saif]

Why this turmoil in garment sector

The recent labour unrest in the industrial belts in and around the capital city including Savar, Ashulia and Gazipur that led to the general holiday or closure of some 219 garment factories till Thursday last surprised many. It is not only garment factories but pharmaceutical, shoe and other

thefinancialexpress.com.bd

Why this turmoil in garment sector
SYED FATTAHUL ALIM
Published :
Sep 15, 2024 21:38
Updated :
Sep 15, 2024 21:38

The recent labour unrest in the industrial belts in and around the capital city including Savar, Ashulia and Gazipur that led to the general holiday or closure of some 219 garment factories till Thursday last surprised many. It is not only garment factories but pharmaceutical, shoe and other industries have also been facing similar workers' agitation. The agitating workers in many cases came up with demands that were not raised before. For instance, in one garment factory in Ashulia, they demanded that there should be equal number of female and male workers in the factories. Despite the fact that the new wage structure is in place since January this year, the workers were demanding an annual increase in wage by 15 per cent, though just seven months back, it was settled at 5.0 per cent. But the workers placing such irrational demands, in most cases, reportedly, did not appear to be in a mood to sit with the management of the factories concerned for negotiations on whatever were their demands. On the contrary, they took to the street and resorted to street violence and attack on the garment units they worked for resulting in closure of many factories.

Similar stories were reported from pharmaceutical factories. However, the management of such industries (non-apparel) did try to resolve the issues with their workers at an early stage. But the situation was different in the case of garment factories. It is alleged that garment factory owners and industry leaders who used to have close connection with the erstwhile fallen regime tried to handle protesting workers even with genuine grievances in the same way that they did in the past. Obviously, that was through the use of force with the help of hired goons. But this policy is not supposed to work under the changed circumstances. In that case, those who allegedly pursued such strong arm tactics to suppress workers with legitimate demands were perhaps some Rip Van Winkles in the garment sector who failed to come to terms with the changed realities. As a consequence, the situation only worsened in the industry as it was rife with rumours that hit panic button among workers to resort to further violence and anarchy. However, as noted in the foregoing there were also instances of labour unrest that were not based on genuine demands, but meant to create chaos. In such cases, as reported by some garment workers, they were incited to agitation and violence by outsiders whom they were not acquainted with.

There is no question that the mass-student upheaval that unseated the immediate past regime has impacted different sections of the working people who think that they are somehow deprived and have a cause to fight for and hence demonstrate their strength to raise new demands. Also, there are others, who want to fish in troubled waters. They might be the beneficiaries of the past government who have a stake in destabilising the mainstay of the country's export sector. There is also the turf war over the lucrative jhut (garment waste) trade that has intensified with the change in political power.

So, whether the labour unrest in the garment sector arose out of workers' genuine demands or that it was the work of saboteurs out to create disorder should be found out before addressing it accordingly. The industry leaders must restore order in their own interest.

The police force that they would depend on so much during the previous regime to quell any labour unrest in their factories with an iron hand is still recovering from the trauma of September 5 revolution. And one should not fail to notice that in about every case of law and order issue, other supporting forces including the military have to come in aid of the police, an arrangement no doubt expensive. Understandably, the garment sector has a strong claim to the government's attention for the simple reason that their products make up more than 80 per cent country's exports. But given the fact that the current interim government which is only one-month-old and yet to fully organise itself, its response to every trouble may not be instant. The industry leaders need to understand this and not wait for the government's support to deal with day-to-day problems like in the past. It may be recalled at this point that in the beginning when the workers as well as troublemakers started to run riot in Savar, Ashulia and Gazipur, the industry leaders met with the interim government advisers a number of times seeking urgent strong action by the law-enforcement agencies. However, later they came up with the idea of conducting joint drives with help of the army, police and the BGB (Bangladesh Border Guard) and suggested the interim government accordingly. Thankfully, the joint drives have reportedly produced results with the arrest of some people (14 persons charged with instigating workers to create unrest). Meanwhile, the good news is, the majority of the garment factories except 49 units in Ashulia area reportedly started operation by Saturday as workers joined their duties. To maintain law and order, the police, Rapid Action Battalion (RAB), the Border Guard and Army personnel were found patrolling streets in the industrial area. Evidently, the wave of post-revolution uncertainties and instability that jolted society is gradually settling down. It is the unity of people that has made it possible. Every segment of society, the garment workers included, should own the change that has taken place and in this crisis time lend a hand so the nation may tide over.​

 

[Saif]

Almost all Savar, Gazipur garment factories resume

Nearly all of the roughly 407 garment factories situated in the Ashulia area under Savar upazila and Zirabo and Zirani areas under Gazipur were operational yesterday after security measures were beefed up centring labour unrests.

www.thedailystar.net

Almost all Savar, Gazipur garment factories resume

Nearly all of the roughly 407 garment factories situated in the Ashulia area under Savar upazila and Zirabo and Zirani areas under Gazipur were operational yesterday after security measures were beefed up centring labour unrests.

Around 15 factories were kept shut by the owners, who also announced that they were implementing a "no work, no pay" clause under the labour law.

Workers at some of the factories have been staging demonstrations for more than 15 days over different benefits and allowances, such as higher night allowances, tiffin bills, attendance bonuses and incentives for achieving production targets.

They also want factory authorities to implement a four-month maternity leave and provide light work to expecting mothers in their fifth month.

Other demands include senior officials refraining from using abusive language in factories and an end to the arbitrary termination of workers by factory authorities. Furthermore, they want due benefits to be paid as per the law if an employee resigns.

No untoward incident was reported yesterday.

Workers at some of the factories have been staging demonstrations for more than 15 days over different benefits and allowances

"I am hopeful that the factories that remained shut will reopen from tomorrow [Monday]," Khandoker Rafiqul Islam, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told The Daily Star over the phone.

"Normalcy has been restored with improvements in law-and-order with the deployment of more police and army personnel," he said.

Law enforcers and labour leaders are holding talks for the reopening of the factories, which witnessed production losses over the last two months, firstly for the anti-discrimination student movement and subsequent labour unrest, Islam said.

The BGMEA has been assessing the loss of business during both periods.

Many factory owners will have to provide discounts and face order cancellations and expensive air shipments, he added.

AK Azad, chairman and executive officer of Ha-Meem Group, which has a garment factory at Ashulia, said his factory resumed operations from yesterday as law-and-order improved and workers rejoined their workplaces.

His factories were shut for 12 days in September and eight days in August because of the labour unrest and anti-discrimination student movement.

He is also assessing his losses and planning for recovery of the losses. His buyers have already expressed concern over the frequent unrests and production losses.

He said he has received a lesser amount of work orders from international retailers and brands targeting the upcoming winter season.

Normalcy has been restored at the garment factories and production is ongoing, said Md Towhidur Rahman, president of the Bangladesh Apparel Workers' Federation.

The factory owners should fulfil commitments made to workers during the labour unrest, he added.

Amirul Haque Amin, president of the National Garment Workers Federation, echoed the same.

"It is business as usual at the industrial zone," he said.

Bangladesh's garment sector has overcome much more critical times and it is expected that the production losses can be recovered, Amin added.

Nazma Akter, president of the Sammilito Garment Sramik Federation, said factory owners should meet the legitimate demands of the workers.

She said production fell by a substantial amount in the garment sector in July, August and September.

These three months comprise the peak season for the shipment of goods for the upcoming Christmas period as well as the peak season for booking work orders for next year's summer, autumn and winter seasons.

However, many senior officials of international retailers and brands cancelled business trips and work orders, delayed factory visits, sought big discounts or expensive air shipments.​

 

[Saif]

Unrest emerges as a new threat to RMG recovery

The number of apparel work orders received by Bangladeshi companies from international retailers and brands for the autumn and winter seasons of 2025 dropped by nearly 10 percent compared to the past due to major shocks from the nationwide student movement and labour unrest in major industrial...

www.thedailystar.net

Unrest emerges as a new threat to RMG recovery
Labour leaders say owners should fulfil all logical demands

PHOTO : AKLAKUR RAHMAN AKASH

The number of apparel work orders received by Bangladeshi companies from international retailers and brands for the autumn and winter seasons of 2025 dropped by nearly 10 percent compared to the past due to major shocks from the nationwide student movement and labour unrest in major industrial belts over the past two and half months.

In light of the tense situation prevailing since July, major buyers pushed back planned trips or altogether cancelled factory visits, which led to a fall in the number of work orders for the upcoming seasons.

The months of July, August and September are not only the peak season for shipping goods meant for sale during Christmas to Western retailers, they are also the busiest months in terms of booking work orders for the next autumn and winter seasons.

However, that period coincided with an unprecedented breakdown in the law and order situation this year.

Production was severely hampered in mid-July, when the Sheikh Hasina-led Awami League government imposed a curfew and an internet blackout to quell the unrest stemming from the demand to reform the job quota system for public recruitment.

Ultimately, those measures proved futile. The Awami League government was overthrown by a mass uprising, with Hasina signalling the end of its tenure by fleeing to India on August 5.

After a new government was formed, led by Nobel laureate Professor Muhammad Yunus, different demands started coming up from workers of numerous sectors.

Of them, garment workers started raising charters of demand and production was halted for nearly 15 days as employees agitated.

Thousands of garment workers came out on the streets in industrial belts like Ashulia, Zirani, Savar, Tongi and Gazipur while some allegedly engaged in vandalism and arson.

Factory owners then began to shut down units one by one to avoid any spillover from the unrest as well as to protect the production units and machinery from vandalism.

This was exacerbated by the fact that the law and order situation was practically non-existent following the changeover in power.

Members of the Industrial Police refrained from patrolling industrial areas as they feared for their safety given that police personnel were being attacked.

Alongside that, the police administration was being reshuffled following the change of government so almost all police stations were hamstrung.

As a result, factory owners dared not run their manufacturing units.

The factories could not be run properly even with the help of the army as it did not have any magistracy powers.

So, most factories in Ashulia, Savar, Zirani and Zirabo either remained shut or were vandalised by workers.

Finally, the factory owners had to turn to their ultimate weapon, shutting down factories under the clause 13(1) of the Bangladesh Labour Act, which mainly deals with the "no work, no pay" stipulation.


WHY DID THE UNREST TAKE HOLD AT THIS TIME?

Many may question why the unrest erupted when the nation was in such a delicate situation, especially considering that a new wage structure for garment workers came into effect in December last year.

However, the workers' standards of living have not improved significantly despite the hike in pay due to persistent inflationary pressure.

According to workers, union leaders, labour experts and factory owners, there were some other reasons behind the labour agitation.

During the latest spell of unrest, workers primarily raised demands to standardise tiffin and attendance allowances as different factories in the same industrial belt pay different rates.

Another demand from workers was to recruit males and females in equal proportion to remove "discrimination".

Moreover, influential locals, especially those with political links, also influenced workers to capitalise on the lack of law and order.

Alongside that, a struggle ensued to fill the power vacuum and take control of the 'jhut' (waste fabric generated during apparel manufacturing) business after the fall of the government on August 5.

At a view exchange meeting with the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) this week, Major General Muhammad Md Moin Khan, general officer commanding of the 9th Infantry Division of Bangladesh Army, outlined three reasons for the unrest: instigation by outsiders, logical and illogical demands raised by the workers, and a turf war over the jhut trade.

Amid the unrest, the interim government said it may review the wage structure.

However, labour leaders said reviewing the wage structure is not the main demand of the workers this time.

Nazma Akter, president of Sammilito Garment Sramik Federation, said many workers had been laid off since the beginning of the movement in July. She also validated their demands, saying their standards of living were still not up to scratch.

The factory owners need to agree with the logical demands, including calls for social protection, removal of some clauses of the labour law, implementation of maternity leave and provident fund, and stopping abuse of female workers, for the greater interest of the garment business, Akter said.

Md Towhidur Rahman, president of the Bangladesh Apparel Workers Federation, echoed Akter's sentiments.

Outsiders are also involved in the latest spate of unrest, he said. However, he added that many garment factories had not paid salaries timely, which was another trigger for the unrest.

"Usually, garment workers get a low salary. So, if they are not paid timely, how will they run their families and meet expenses such as house rent and tuition for their children?" he asked.

As an example, he said that some garment factories had not paid workers their salary for the month of August yet.

Last week, Amirul Haque Amin, president of the National Garment Workers Federation, said more than 400 garment workers were blacklisted by different factories for alleged involvement in the unrest.

As attendance of workers is registered through biometrics, either through fingerprints or facial detection, blacklisted workers cannot get jobs at other factories.

So, Amin said factory owners should wipe the names of those workers from the blacklist since they engaged in the unrest only to realise their logical demands.

At present, normalcy is being restored to industrial belts, particularly areas in Ashulia, Savar, Zirani and Zirabo, as security has been beefed up by deploying more members of law enforcement agencies.

Almost all factories in these areas were reopened by Sunday and production started as the workers re-joined their workplaces.

IMPACT OF THE UNREST

Not only have a certain percentage of work orders been diverted from local factories, but officials are also concerned about whether they can ensure the timely delivery of goods.

Consequently, Bangladeshi garment exporters will have to provide big discounts or opt for expensive air shipments to offset the time lost.

In some cases, work orders may be cancelled due to a failure to ship goods timely.

But in most cases, exporters will choose air shipment despite steep costs in order to meet the strict lead times and maintain smooth relationships with retailers and brands.

However, they know all too well that the profit margin will be dented significantly due to the increased costs of air shipment.

To ship goods via air from the Dhaka airport to any destination in Europe, exporters must pay over $4 per kilogramme of dry cargo.

However, it would cost less than 10 cents to send the same shipment to Europe through the Chattogram seaport.

The long-lasting disruption to production is the latest setback for Bangladesh's garments industry, which was already struggling to recover from the severe fallout of the Covid-19 pandemic, the Russia-Ukraine war, persistent inflation, and the Red Sea crisis.

Khandoker Rafiqul Islam, president of the BGMEA, said that apart from a 10 percent decrease in work orders, nearly the same percentage of work orders have been diverted to other countries.

It will take time to recover the lost work orders and it depends on full restoration of the normal business environment, Islam told The Daily Star over the phone.

As many factories were struggling, the Bangladesh Bank helped them clear salaries for the month of August. Around 90 percent of units had paid salaries for August as of September 17, he added.

"We expect full normalcy to be restored to industrial belts and for business to go back to usual after workers rejoin their workplaces," the BGMEA president also said.​

 

[Saif]

Number of green apparel factories now stands at 229

The total number of LEED-certified green factories in Bangladesh has now reached 229, following the recent certification of three more apparel and textile factories by the US Green Building Council under the Leadership in Energy and Environmental Design programme...

www.newagebd.net

Number of green apparel factories now stands at 229
Staff Correspondent 21 September, 2024, 22:34

A file photo shows workers sewing clothes at a green readymade garment factory at Savar on the outskirts of Dhaka. | New Age photo

The total number of LEED-certified green factories in Bangladesh has now reached 229, following the recent certification of three more apparel and textile factories by the US Green Building Council under the Leadership in Energy and Environmental Design programme.

According to the Bangladesh Garment Manufacturers and Exporters Association, out of the 229 LEED-certified green factories in Bangladesh, 91 have achieved platinum ratings, while 124 have received gold certification.

With its recent advancements in sustainable practices, Bangladesh now boasts 61 of the top 100 highest-rated LEED certified factories in the world.

The newly certified factories are Sepal Garments Ltd in Gazipur, Unitex Spinning Ltd (Unit-2) in Chattogram and Ananta Huaxiang Limited in Narayanganj.

Both Sepal Garments Ltd and Unitex Spinning Ltd achieved platinum certification, scoring 85 and 43 respectively, while Ananta Huaxiang Limited earned gold certification with a score of 63.

Despite facing challenges from a global economic downturn and domestic issues, Bangladesh’s readymade garment industry continues to focus on sustainable growth, BGMEA director Mohiuddin Rubel said.

He said that the multiple LEED certifications reflected the apparel industry’s commitment to environmental sustainability and enhanced its reputation as a reliable sourcing partner.

Mohiuddin also mentioned that sustainability had always been integral to their operations, ensuring that their growth aligned with international best practices and promoted environmental responsibility.

‘With ongoing partnerships and commitment, we are confident that the Bangladesh RMG industry will reach new heights of excellence, further solidifying its position as a global leader in sustainable and ethical manufacturing,’ the BGMEA leader mentioned.

The Leadership in Energy and Environmental Design (LEED) certification, awarded by the US Green Building Council, is earned by projects that meet prerequisites and credits addressing carbon, energy, water, waste, transportation, materials, health and indoor environmental quality.

Platinum certification, the highest category, requires projects to earn more than 80 points out of 110, while gold certification ranges from 60 to 79 points, and silver certification from 50 to 59 points.​

 

[Saif]

When will the RMG industry owners change?

Bangladesh's readymade garment sector is 45 years old. This garment sector is the source of 80 per cent of the country's export revenue. It also generates employment. As a single country, Bangladesh now stands second in readymade garment (RMG) exports.

en.prothomalo.com

When will the RMG industry owners change?

After the fall of the Sheikh Hasina government, unrest has emerged in the readymade garment sector again. The garment sector is one of the mainstays of the country's economic growth. Turmoil in the sector and labour unrest are nothing new. Analysing issues pertaining to the rights of workers in the garment industry, owner-worker relations, as well as the political clout and power of the owners, Shawkat Hossain writes about reforms in the sector.
Shawkat Hossain
Updated: 22 Sep 2024, 16: 44

Reforms are needed in the management of the RMG sector. Most important are reforms in the mindset and behaviour of the owners.Prothom Alo

Bangladesh's readymade garment sector is 45 years old. This garment sector is the source of 80 per cent of the country's export revenue. It also generates employment. As a single country, Bangladesh now stands second in readymade garment (RMG) exports.

So much has happened over these 45 years, but only one thing hasn't changed. And that is the mindset and behaviour of the RMG industry management. The garment sector is still run on those old conventional lines. The only thing that the persons concerned in this sector have learnt, is to suppress any movements by means of coercion and fear. The garment owners are so politically powerful now, they have no problem whatsoever to ensure all decisions are taken in their favour.

On the other hand, with all regular means of protest shut down, the garment sector workers have no alternative but to take to the streets in order to voice their demands. They have learnt no other way.

Bangladesh will graduate from the Least Developed Country status in 2026. In order to meet the demands of the day then, it is imperative that the RMG sector also undergoes significant changes in its system of management. This requires reforms. And work on this must start now. After all, Bangladesh's economy cannot survive without the RMG sector.

Owners' reforms needed first

The RMG sector has two owners' organisations, BGMEA and BKMEA. Selim Osman, a member of the much touted Osman family of Narayanganj, had been the president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) for a stretch of 14 consecutive years. He first became the BKMEA president in 2010 after Awami League came to power. He was elected the association's president once in 2012 and then the rest of the time he became president through understanding and by force.

He had also been the member of parliament of Narayanganj-5. He would contest from Jatiya Party, while his brother Shamim Osman was the Narayanganj-4 member of parliament from Awami League. Selim Osman's main task was to hold onto the parliamentary seat. Under their dominance, BKMEA contributed nothing to the interests of the industry.

Meanwhile, with one or two exceptions, being the president of BGMEA meant entering the hallowed halls of becoming a member of parliament or being mayor of Dhaka City Corporation. So their main task was to extend support to the government. Only the interests of the government and the owners mattered.

In 2009, a total of 23 owners of garment factories were elected as members of parliament. BGMEA accorded a reception to the members who were elected in the national election. The former president of BGMEA Annisul Huq had been the FBCCI president. The late Annisul Huq later became the mayor of Dhaka City Corporation. Thus a new door opened for the top leaders of BGMEA. After Annisul Huq passed away, Atiqul Islam, another former BGMEA president, became the new mayor.

From 2009 to 2019, whoever had been the president of this organisation, all became either mayor or member of parliament or was placed in some top position. For example, Salam Murshedy who had been BGMEA president from 2009 to 2011, later became MP from Khulna. The next president of the association, Shafiul Islam Mohiuddin, became an MP from a seat in Dhaka. The next president was former mayor Atiqul Islam, now absconding. Then Siddiqur Rahman, Awami League's commerce and industries secretary, was president for four consecutive years. The BGMEA president of 2005-06 Tipu Munshi also became MP and later went on to becoming the commerce minister.

Much earlier, two presidents Mosharraf Hossain and Redwan Ahmed, became MPs from BNP. Redwan Ahmed went on to become a minister too. They were presidents of BGMEA from 1991 to 1996.

SM Mannan was the last elected president of BGMEA. He was the general secretary of Dhaka city (North) Awami League. Known as Mannan Kochi, this BGMEA leader was in the committee for around the last twelve years or so. Politically active Mannan Kochi was kept on the committee to keep political links with Awami League and to suppress any labour movement.
Over the last 45 years, BGMEA has learnt one thing very well and that is to use various agencies of the government to suppress movements, keep wage demands at a minimum and extract benefits and facilities from the government. Labour leaders were linked to them too. They would support the owners in exchange of money. This would happen more at the time of fixing the wage structure.

Actually, BGMEA or FBCCI are basically the business branches of the ruling party. This applies to the business chambers too. So these trade bodies need to undergo reforms. Only then will the use of politics in the interest of business be curtailed.

Demands vs. discussions

The owners complain that the movements in the garment sector do not follow any conventions or rules. On the other hand, the labour leaders say there is no system in the RMG sector for formal bargaining. That is why the movements are not carried out in any regulated manner.

Due to international pressure after the collapse of Rana Plaza in 2013, the registration process for labour unions in the garment sector was relaxed. So far there are 1300 labour unions registered in this industry. In the remaining 70 per cent of the factories there are committees. In most cases, persons with allegiance to the owners are in the leadership of these unions or committees. Those who are not of that camp, are harassed in all sorts of ways after every movement.

After Sheikh Hasina fled from the country and the interim government was formed, like many others, the RMG workers too took to the streets with their demands. While the others have all returned to work, the unrest prevails in the garment sector. The owners can no longer use the intelligence agencies or police to threaten and scare them. In such circumstances, a way for a regulated manner to voice the workers' demands must be formulated. Also, a way for discussions to meet their demands must be created. And whenever there is a movement, random accusations of outside conspiracies, foreign instigation, etc, must halt.

The demands this time

The workers have at least 20 types of demands this time. The written demands of several factories have been analysed. The demands include, increase of annual incentive from 50 per cent, introducing provident fund, 15 days paternal leave, increase of tiffin bill from 35 taka to 50 taka, increase of attendance bonus, increasing maternity leave to 6 months, providing Eid bonus equal to net wage, increasing lunch allowance if working on Fridays, 20 days festival leave, earned leave 30 days, medical leave 20 days and payment of wages within the last five working days of the months.

The other demands of the workers are arranging for one free ultra-sonogram, providing the women with sanitary pads, increasing daycare facilities, two days leave during mensuration, installing an ATM booth, providing Vitamin C during pregnancy and arranging for eye tests and sunglasses.

In 2023 the minimum wage in the garment sector proposed by the workers was Tk 20,393, while the management proposed Tk 10,400. The workers were enraged at the management's proposal and took to the streets, resulting in the death of a worker. When the situation went out of control, the management proposed a minimum wage of Tk 12,500 and that was finalised. But when the movement continued, 43 cases were filed and 114 were arrested. While there is dissatisfaction with that wage, the workers are not demanding for a wage now, after the fall of the government. They are wanting certain benefits and facilities.

If wages and allowances are not paid regularly, workers will invariably take to the streets. If the present or future movements are to be halted, it is the garment sector management that needs to be reformed

The owners get all

The first wage board for the garment sector was formed in 1994 and the minimum wage was Tk 930. Now 30 years hence, the wage has increased to Tk 12,500. In the 1994-95 fiscal, export revenue from the garment sector was USD 2.23 billion (USD 223 crore). That revenue has now increased to USD 40 billion (USD 4000 crore). Government and international policy support had a significant role to play in this revenue increase.

For example, before the formation of the World Trade Organisation (WTO), from the time of GATT negotiations, Bangladesh would receive quota facilities up till 2004 under the Multi Fibre Arrangement (MFA). Even though the quota system was lifted in 2005, Bangladesh did not fall back in competition. It is receiving Generalised System of Preference (GSP) facilities from the European Union. Several countries, on a bilateral basis, are still providing Bangladesh with tariff-free market access.

In the meantime, in 1982 changes were made to the industrial policy. There were duty drawback facilities in place for exports. By this, while entrepreneurs paid duty when importing raw materials, this would be reimbursed after export. However due to delays, corruption and procedural problems, the bond facilities were put in place instead. Under this, the garment industry owners could import all sorts of raw material for garment manufacture, free of duty.

In 1986-87 the government introduced back-to-back LC. Under this system, after the export revenue was received, only then would the bank have to be repaid. Researchers feel these two policies have played a vital role for the advancement of the garment sector. Even after that, the government has provided all sorts of concessions including cash incentives. And whenever the garment owners were in a crisis, they have reached out to the government, and the government has fulfilled all their demands.

Giving, not just taking

The readymade garment owners never want to admit that business is doing well. Speaking to any garment factory owner, they will invariably say that business is in a bad shape, orders are dwindling, buyers are purchasing garments at low prices, production costs have shot up and the productivity of the workers here is low.

Yet leaders who work with the workers of the garment sector say that the wealth and the lifestyles of the garment owners do not indicate that business is bad. Even in 2022 the dollars rate was Tk 86. That dollar now stands at Tk 120. So they are receiving Tk 36 more than before for every dollar of their export earnings. Also, if they want productivity to increase, they must give workers fair wages and other facilities and benefits. You can't expect highest productivity with lowest wages. There must be an adjustment between the two.

Another problem in the garment sector is the trade related to waste fabric scraps known locally as 'jhut'. Leaders and activists of the ruling party control this business. The garment factory owners are obliged to sell the fabric scraps or 'jhut' to the political goons. Whenever there is a change in the government, the control of this trade changes hands. So long the Awami League men had controlled this business, now the BNP men are trying to take over.

This too has provided instigation in the present movement. The garment factory owners say if they got fair price for the fabric scraps, they could use this for the workers' welfare. Whether they actually would or not, is another question. But this problem must be resolved. This requires political commitment and the rule of law, and that needs to be ensured by the government.

If wages and allowances are not paid regularly, workers will invariably take to the streets. If the present or future movements are to be halted, it is the garment sector management that needs to be reformed. Most important is the reforms of the owners' mindset and behaviour. The habit of giving, not just taking, must be formed.

* Shawkat Hossain is head of online, Prothom Alo​

 

[Saif]

British-Irish firm to invest $36m in Bepza EZ

British-Irish company Deltaport Ltd will invest $36 million to set up a garment factory in the economic zone of Bangladesh Export Processing Zones Authority (Bepza) at Mirsarai in Chattogram.

www.thedailystar.net

British-Irish firm to invest $36m in Bepza EZ

British-Irish company Deltaport Ltd will invest $36 million to set up a garment factory in the economic zone of Bangladesh Export Processing Zones Authority (Bepza) at Mirsarai in Chattogram.

The company has set a target to annually produce 20 million pieces of protective clothes, workwear, various garments, PPE, hospital gowns, masks, bed sheets, curtains and other items.

The factory will create employment for 5,980 Bangladeshi nationals.

Deltaport Ltd is a sister concern of Eastport Ltd, a garment manufacturing company of the Cumilla EPZ that has been operating since 2013.

According to a press release, Md Ashraful Kabir, member (investment promotion) of Bepza and Junaid Iqbal Umerani, representing Deltaport, signed the agreement at the Bepza Complex in Dhaka recently.

Major General Abul Kalam Mohammad Ziaur Rahman, executive chairman of Bepza, Mohammad Faruque Alam, member (engineering), and ANM Foyzul Haque, member (finance), were also present.​

 

[Saif]

Fresh labour unrest shuts 70 apparel factories in Bangladesh

The authorities of at least 70 industrial units, including 59 readymade garment factories in Savar, Ashulia, and Gazipur, were forced to suspend operations on Monday as fresh workers’ protests broke out...

www.newagebd.net

Fresh labour unrest shuts 70 apparel factories in Bangladesh
Staff Correspondent 23 September, 2024, 23:28

Army personnel detain 24 people on charge of creating anarchy in the industrial area at Kaliakair in Gazipur on Monday. | New Age photo

The authorities of at least 70 industrial units, including 59 readymade garment factories in Savar, Ashulia, and Gazipur, were forced to suspend operations on Monday as fresh workers’ protests broke out over several demands, including a wage hike.

According to the Industrial Police, out of 70 industrial units, 52 are located in Savar and Ashulia while the rest 18 factories are in Gazipur industrial area.

Law enforcers detained 21 individuals in Gazipur on the charges of instigating labour unrest in different factories.

Against the backdrop of fresh labour unrest, the Bangladesh Garment Manufacturers and Exporters Association convened an emergency general meeting on Monday night at its headquarters in Uttara in the capital.

During the meeting majority of the factory owners opposed to increase wage and raise the annual increment from the current 5–10 per cent.

They argued that the new wage was set in December 2023 and the sector was currently grappling with several challenges stemming from both global and internal factors, including a decline in global demand and high production costs exacerbated by rising energy prices, and elevated bank interest rates.

Factory owners said that production had been suspended for over two weeks this month and that they had previously experienced closures during the July–August anti-discrimination movement, which led to buyers shifting work orders to other countries.

The emergency general meeting was still in progress at the time of filing this report about 8:30pm.

Ashulia zone Industrial Police superintendent Mohammad Sarowar Alam told New Age that total 43 factories, mostly RMG units in Ashulia belt, were closed under the section 13(1) of the Bangladesh Labour Act, while eight others announced general holiday on Monday amid the labour unrest.

Sources from the Industrial Police headquarters said that production in 18 industrial units was suspended in Gazipur area on the day.

Police sources said that workers from the Seasons Dress garment factory in Gazipur took to the streets on Monday morning, blocking the Dhaka-Mymensingh highway over unpaid wages for part of July and August.

Meanwhile, workers from Generation Next in Ashulia also gathered on the Bipail-Abdullahpur road, demanding wage payments and other issues.

Industrial Police and Army personnel were dispatched to both locations, where demonstrating workers were joined by workers from other factories, they added.

The police said that workers from many factories on Monday demanded a wage hike, which was a fresh demand since no such demands came earlier from the protests that began since the end of August to continue for over three weeks.

On September15, the unrest was brought under control as most factories reopened and workers returned to work, following a tripartite call from factory owners, labour leaders, and advisers of the industries, labour and employment, and fisheries and livestock.

The situation improved last week despite protests within some units over various demands continued.

But from Sunday the situation deteriorated again when workers blocked two major highways in Ashulia and Gazipur over issues, including unpaid dues, wages and tiffin bonuses.

Considering the situation, the labour ministry on Monday held a meeting with factory owners and labour leaders to find ways to calm the situation.

At the meeting labour leaders placed a 18-point demand compiling the demands of agitated workers in several garment factories in Ashulia and Gazipur.

The demands include—reconstitution of the wage board to set new minimum wages for workers; quick implementation of the 2023 minimum wage in factories; amendments to labour laws; immediate payment of all outstanding wages; and increase in attendance bonuses, tiffin bills and night allowances at the same rate across all factories.

The demands also include establishment of provident funds in all factories; 10 per cent yearly wage increase and food rations for workers; no blacklisting of workers following the biometric database; withdrawal of cases against those involved in the 2023 wage protests; enactment of guidelines to limit the dominance of jhut (garment factory waste materials) business; and establishment of non-discriminatory employment practices in factories.

The demands further include compensation and medical care for workers killed or injured during the July-August movement; initiatives to support the well-being of Rana Plaza survivors; mandatory establishment of day-care centres in all factories as required by labour laws; and stopping of unlawful terminations; and extension of maternity leave to 120 days.

Labour secretary AHM Shafiquzzaman at the meeting assured labour leaders that the government was addressing several of the workers’ demands, including compensations for those killed in the July-August movement and the Rana Plaza building collapse.

Some issues, such as wage reviews, depended on policy decisions, and the ministry was committed to working on them, he said adding that factory owners agreed to meet some factory-level demands, including various bills, payment of dues, and the implementation of wages.

Regarding other matters, including the 10 per cent yearly increment, factory owners said that that they would announce their decision following discussions with fellow factory owners.

During the meeting, factory owners termed security as the prime concern for running factories at the moment.

Export orders were shifting to other countries due to the unrest forcing many factory owners to struggle to pay September wages in time, they said.

Hameem Group managing director AK Azad, former Bangladesh Textile Mills Association president Tapan Chowdhury, Bangladesh Garment Manufacturers and Exporters Association president Khandoker Rafiqul Islam, Garment Workers Trade Union Centre president Montu Gosh, Sammilita Garment Shramik Federetion president Nazma Akter, Bangladesh Garment and Industrial Workers Federation president Babul Akter, and Sramik Samhati president Taslima Akhter, among others, spoke at the meeting.​

 

[Saif]

Factory owners accept all 18 demands of RMG workers

Garment factory owners in Bangladesh have accepted all 18 of the demands of the workers, such as ensuring provisions for tiffin and night allowances, to tame ongoing unrest in the sector.

www.thedailystar.net

Factory owners accept all 18 demands of RMG workers

Army personnel are posted outside a shuttered garment unit in the Narasinghpur area of Savar. Industrial belts have been hit hard by unrest as garment workers agitated to have their demands met. The government and factory owners yesterday accepted all of their demands. Photo: Aklakur Rahman Akash

Garment factory owners in Bangladesh have accepted all 18 of the demands of the workers, such as ensuring provisions for tiffin and night allowances, to tame ongoing unrest in the sector.

Labour and Employment Secretary AHM Shafiquzzaman announced the decision at a press briefing at the labour ministry in Dhaka yesterday. He was joined by four advisers to the interim government, union leaders and leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

According to our Savar correspondent, around 55 garment factories in the Ashulia area remained closed yesterday.

Normal operations in the industrial zones are expected to resume on Wednesday as demands have been addressed, Labour and Employment Adviser Asif Mahmud Sajib Bhuiyan said at the briefing.

The arrears in salary will also be cleared, he said, adding that normalcy would be restored to the sector from today.

Home Affairs Adviser Jahangir Alam Chowdhury echoed Bhuiyan's sentiments, urging workers to return to their workplaces.

"I want to see all industrial units operating from tomorrow [Wednesday]. Please do not take the law into your own hands," Chowdhury said at the meeting.

Speaking on behalf of union leaders, Kutub Uddin Ahmed, former secretary general of IndustriALL Bangladesh Council, also urged workers to return to work.

He added that different quarters outside the garment sector had been instigating the unrest.

The workers' key demands included implementing the existing minimum wage in all factories and settling all outstanding payments. Additionally, workers sought to raise attendance bonuses by Tk 225, night shift bonuses by Tk 10 and tiffin allowance by Tk 10.

Shafiquzzaman said around 1 to 2 percent of garment factories did not implement the latest wage structure that came into effect in December last year.

He added that the government would also provide support in dense industrial areas under the Trading Corporation of Bangladesh's open market sales programme, allowing workers to buy essentials at cheap rates.

The government will frame a policy to centrally control the jhut (waste fabric) business as control for the trade of scrapped clothes emerged as one of the main reasons for the unrest.

A separate review committee will submit a report on the industry's capacity to review the wage structure, the labour secretary said, adding that the government will also review police cases against workers to ensure they are not harassed.

Md Sarwar Alam, superintendent of Ashulia Industrial Police-1, said yesterday: "Of the closed factories, 46 were shut today due to workers' protests over demands for salary increases, increments and other benefits while nine had declared a general holiday."

Labour leaders reported that workers of several factories gathered in front of the premises in the morning but left when they were found to be closed.

According to the Industrial Police, the closed factories are primarily located along the Bypail-Abdullahpur road in the Jamgora, Narasinghpur, and Zirabo areas of Ashulia.​

 

[Saif]

A welcome decision to resolve RMG unrest

Cooperative efforts, sound leadership vital going ahead

www.thedailystar.net

A welcome decision to resolve RMG unrest
Cooperative efforts, sound leadership vital going ahead

VISUAL: STAR

We welcome the decision of garment factory owners to accept all 18 demands of agitating workers, a much-needed development that will hopefully resolve the unrest that plagued the sector for weeks. According to a report by this daily, factory owners on Tuesday agreed to workers' demands including enforcing the minimum wage in all factories, clearing outstanding payments, provisions for tiffin and night allowances, etc. The government will also help workers in dense industrial areas buy subsidised essentials through its Open Market Sales (OMS) programme, regulate the scrapped clothes business (a key source of the unrest), and review police cases against workers to prevent harassment.

As expected, the decision has had an immediate impact as most factories in Savar and Ashulia reopened on Wednesday, with workers returning to their duties in a peaceful manner. Security has also been beefed up to prevent any untoward situation. However, some factories still remained closed, mainly owing to disruptions caused by financial constraints. This again highlights the urgency of addressing the losses suffered by factories not just during protests but also in the unprecedented mayhem that ravaged various industrial units since the regime change on August 5. The truth is, while we recognise the importance of Tuesday's decision to restore order, we cannot ignore the tremendous challenges that lie ahead for the industry.

The cumulative effect of frequent factory closures and suspensions of production and the vandalism witnessed over the past month and a half is that a number of international buyers have diverted their orders to competing nations. We have earlier commented on how this situation is affecting business, especially after many requests for value-added garments were cancelled or postponed because buyers had to cancel their trips. For a country heavily reliant on its garment exports, such shifts in buyer confidence and preferences do not bode well for both the sector and the country.

The diminished work flow will likely continue to haunt the industry, affecting not just workers and owners but also the scope of investment in modernisation, sustainability, and compliance with global standards. As highlighted by an industry insider, a consolidation phase appears imminent with smaller and financially weaker factories potentially closing. There are lessons for all stakeholders in this: the government, factory owners, and union leaders. Going ahead, they all must ensure collaborative efforts and sound leadership to prevent any further turmoil. The government, in particular, must undertake a comprehensive review of the health of the industry and provide necessary support to help it rise again.​