[🇧🇩] Textile & RMG Industry of Bangladesh

[Saif]

RMG makers to seek buyers' support in emerging situation

Apparel makers are now considering writing US buyers seeking their patience and support in the wake of the emerging situation over new US tariff regime, insiders said. A number of the leading makers sat on Sunday night to brainstorm as to how they can cope with the situation in support with their

thefinancialexpress.com.bd

RMG makers to seek buyers' support in emerging situation
Monira Munni
Published :
Apr 07, 2025 00:05
Updated :
Apr 07, 2025 00:06

Apparel makers are now considering writing US buyers seeking their patience and support in the wake of the emerging situation over new US tariff regime, insiders said.

A number of the leading makers sat on Sunday night to brainstorm as to how they can cope with the situation in support with their major US buyers.

Meantime, US buyers of the locally made apparel items have started renegotiation with some of their local suppliers with few asking to hold their shipments either in ports or factories while some others seeking price concession, they added.

They, however, expect large volume of buyers' response on Tuesday onwards as Sunday was holiday and apparel sector trade body BKMEA has already asked its members to provide information in this regard.

On the other hand, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) is likely to write US buyers requesting them to have patience for a certain period and not to impose any additional cost burdens, like keep orders on hold and price discounts, to suppliers.

The trade body would also inform the buyers about the government's diplomatic engagement with the US authorities to align bilateral trade relationship with the US, they added.

Talking to the FE, AKM Saifur Rahman Farhad, vice president of Bangladesh Garment Buying House Association (BGBA), said one of his US customers has asked for price reduction for an order worth of US$0.3 million while wants to renegotiate for goods worth of US$0.175 million.

Abdullah Al Mamun, owner of Sense Garments BD, said he annually produces 0.2 million pieces of apparel for a US buyer and he already shipped goods for May, goods for June is on the process of shipment.

He, also a member of BGBA, said the buyer has asked for suspension of production scheduled for July and holding the fresh order of 0.22 million pieces of apparel for August.

Expressing concern, he said one of his supplier factories that solely produces goods for the buyers is now in uncertainty over a shipment of 0.3 million pieces of garment scheduled to reach US port within 10 to 15 days.

It is not possible to shift the products immediately, he added.

Both the BGBA leaders called for immediate measures from the government as buyers are also expressing concern as to what Bangladesh government is doing.

"They also want to be assured from our parts," Mr Farhad added.

When asked, Fazlee Shamim Ehsan said he also heard that one of the US buyers has asked a garment maker to hold his production for a week to let them better understand the situation.

Responding to a question, he said they are also likely to write to the buyers seeking their supports in the crisis period.

According to him, BKMEA members have received work orders worth of US$2.75 billion since last October to March.

The United States is the single largest export destination for Bangladesh made exportable products mostly readymade garments.

Bilateral trade between the two countries stood at US$10.58 billion in 2024 with Bangladesh maintaining a healthy trade surplus of US$6.15 billion.

Bangladesh exported goods worth US$8.37 billion to the US in 2024 while the country imported $2.21 billion worth of goods from the US.

Out of Bangladesh's US$8.37 billion exports to the US, apparel items fetched US$ 7.34 billion, according to data.​

 

[Saif]

US loses cotton market share in Bangladesh

The United States is losing its market share in cotton exports to Bangladesh amid concerns about logistics and the lengthy shipment duration for American cotton, according to a recent report by the US Department of Agriculture (USDA).

www.thedailystar.net

US loses cotton market share in Bangladesh

The United States is losing its market share in cotton exports to Bangladesh amid concerns about logistics and the lengthy shipment duration for American cotton, according to a recent report by the US Department of Agriculture (USDA).

Bangladesh's millers imported 7.8 million bales of cotton in the marketing year (MY) 2023-24, beginning in August.

Of that, the share of US cotton, a key raw material for the country's apparel industry, was 9 percent. A year ago, in MY23, the share of cotton imported from America was 10 percent.

During the first seven months of MY25, local importers bought 286,056 bales of cotton from the US. The amount was only 6 percent of the total import of the item, down from 11 percent during the same period a year ago.

The USDA's report came just days before the Trump administration hiked tariffs on goods from 60 countries, including Bangladesh, entering the American market.

Bangladesh's exports will face a 37 percent higher tariff in the US market following Trump's tariff hike, which has created worries among exporters. It also prompted Chief Adviser Muhammad Yunus to write to the US President, promising to significantly increase imports of US farm products, including cotton.

The government is also finalising a dedicated bonded warehousing facility in Bangladesh, where US cotton will have duty-free access, according to the letter.

Citing its industry contacts, the USDA said the quality of US cotton is better than cotton from other sources.

"Many spinning mills in Bangladesh prefer US cotton; however, they always express concerns about the logistics and lengthy shipment duration required to obtain US cotton," it said in its Cotton and Products Annual report released on March 31.

The agency said many cotton merchandisers sell South American and West African cotton while it is afloat.

"This practice helps to reduce the shipment duration. However, US cotton is not sold afloat. Merchandisers also store their cotton in nearby warehouses in ports in Malaysia, Singapore, and Sri Lanka. Cotton from these warehouses can be delivered to Bangladesh in just seven days."

As per the report, West African countries and Brazil gained market share in cotton exports.

The West African countries collectively supplied 1.9 million bales, 41 percent of Bangladesh's total imports during the first seven months of this marketing year, the USDA said.

The US agency said the market share of West African and South American cotton is gradually increasing based on these logistical benefits, which allow importers to take advantage of price shifts.

"As a single country, Brazil emerged as the major raw cotton supplier to Bangladesh during this period," it said. Brazil exported 970,487 bales, comprising 20 percent of the market share, followed by India with 887,600 bales and a 19 percent share.

"Spinners prefer to buy Brazilian cotton due to its competitive pricing, increased availability during the harvesting season, and supply stability. The shipment period is also shorter for Brazilian cotton as it is often sold while it is afloat."

Cotton imports to rise

The US agency forecast an increase in cotton imports by Bangladesh to 8.2 million bales in MY26, up 1.2 percent year on year.

The report, citing industry contacts, said the RMG sector has shown resilience and growth despite recent political upheavals that led to the ouster of Sheikh Hasina's government in August 2024. The unrest led to factory shutdowns and a decline in international work orders. However, the industry has rebounded.

"With law and order restored, international clothing brands have resumed placing new orders since mid-January 2025, fostering optimism among garment exporters, with an increase in work orders from early 2025 boosting the demand for cotton."

"As the RMG industry is expecting a resurgence in work orders, the demand for raw materials, including cotton, will increase," it said.​

 

[Saif]

Garment sector resumes regular production after Eid: BGMEA

Nearly all garment factories under the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) have resumed operations following the Eid-ul-Fitr holidays. 2,012 out of 2,024 factories – or 99.40 per cent – have reopened as of Wednesday, UNB reports citing a BGMEA statement i

thefinancialexpress.com.bd

Garment sector resumes regular production after Eid: BGMEA
FE Online Desk
Published :
Apr 12, 2025 18:07
Updated :
Apr 12, 2025 18:07

Nearly all garment factories under the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) have resumed operations following the Eid-ul-Fitr holidays.

2,012 out of 2,024 factories – or 99.40 per cent – have reopened as of Wednesday, UNB reports citing a BGMEA statement issued on Saturday.

The highest concentration of garment factories is in the Gazipur and Mymensingh regions, where 851 out of 854 units are currently in operation.

In Savar, Ashulia and Jirani areas, 399 of 403 factories have resumed production. Besides, 186 factories are operational in Narayanganj, 320 in Demra, and 336 in Chattogram.

BGMEA data also reveals that 2,019 factories have already disbursed salaries for February, with only five factories – four in Dhaka and one in Chattogram – yet to do so.

As of now, 2,008 factories have paid salaries for March, either partially or in full. However, 16 factories are still pending full salary payments for the month, and 16 others have only paid partial salaries.​

 

[Saif]

Increase imports of US goods to reduce trade gap: textile millers

They also suggested increasing US content in manufactured goods to 20% to qualify for reduced tariff rates

www.thedailystar.net

Increase imports of US goods to reduce trade gap: textile millers
They also suggested increasing US content in manufactured goods to 20% to qualify for reduced tariff rates

Bangladesh Textile Mills Association President Showkat Aziz Russell speaks at a roundtable on US tariffs, organised by the association at Gulshan Club in Dhaka today. Photo: BTMA

Textile millers and garment exporters today urged the government to increase imports from the US market in order to reduce the trade imbalance between Bangladesh and the United States.

They made the call at a roundtable on "US Tariffs on Bangladesh's Exports: Reciprocal Strategies and Way Forward for Negotiations," organised by the Bangladesh Textile Mills Association (BTMA) at Gulshan Club in Dhaka.

Showkat Aziz Russell, president of the BTMA, proposed leveraging Bangladesh's status as a major importer of American cotton by manufacturing cotton-based garments for duty-free access to the US market.

He also called for robust government support and greater foreign direct investment (FDI) to create employment and enhance competitiveness in the textile sector.

In his keynote, Masrur Reaz, chairman of Policy Exchange Bangladesh, underscored the significance of the recent 90-day deferment on new US tariffs and suggested that stakeholders move beyond diplomacy alone and pursue market-based solutions.

"Bangladesh must act decisively—by engaging buyers and brands, increasing US content in exports, and assessing sector-specific impacts—to secure long-term access to the US market," said Reaz.

The speakers suggested increasing US content in manufactured goods to 20 percent to qualify for reduced tariff rates, and establishing US cotton storage hubs in Bangladesh to streamline imports and eliminate logistical barriers.

They also recommended investing in infrastructure, industrial capacity, and human capital to boost productivity and global market readiness, and encouraging US investment in diversified sectors to expand export offerings.

Including the US private sector in ongoing free trade agreement (FTA) dialogues alongside government efforts was also recommended.

Participants expressed cautious optimism that evolving global trade realignments could open new doors for Bangladesh. However, they warned that inaction could lead to long-term setbacks.

The US remains Bangladesh's largest export destination, accounting for nearly 20 percent of total readymade garment exports, valued at $7.34 billion in 2024.

Hafizur Rahman, administrator to the Federation of Bangladesh Chambers of Commerce and Industry; Anwar Hossain, vice chairman of the Export Promotion Bureau and administrator to the Bangladesh Garment Manufacturers and Exporters Association, attended the event.

Anwar-ul Alam Chowdhury, president of the Bangladesh Chamber of Industries; Abdul Hai Sarker, president of the Bangladesh Association of Banks; and Shamim Ahmed, president of the Bangladesh Plastic Goods Manufacturers and Exporters Association, also attended.

Mohibuz Zaman, managing director of ACI Healthcare Ltd, and Mohammad Helal Mia, chairman of Amanat Shah Group, were also present.​

 

[Saif]

Bangladesh suspends import of yarn via land ports from India

The National Board of Revenue (NBR) has suspended the import of yarn from India through land ports. The facilities for importing yarn through Benapole, Bhomra, Sonamasjid, Banglabandha, and Burimari land ports have been revoked.

en.prothomalo.com

Bangladesh suspends import of yarn via land ports from India
Special CorrespondentDhaka
Updated: 15 Apr 2025, 19: 55

The unusual hike in yarn price is impacting the competitiveness of RMG industry BSS

The National Board of Revenue (NBR) has suspended the import of yarn from India through land ports.

The facilities for importing yarn through Benapole, Bhomra, Sonamasjid, Banglabandha, and Burimari land ports have been revoked.

The NBR issued a notification in this regard on Tuesday, with immediate effect.

The new notification revises the earlier one issued on 27 August 2024. Yarn was primarily imported from India through these land ports.

Earlier in February this year, Bangladesh Textile Mills Association (BTMA), an organisation representing textile industry owners, demanded the suspension of yarn imports from India via land ports.

Subsequently, in March, the Bangladesh Trade and Tariff Commission, under the commerce ministry, recommended that the NBR takes measures to halt yarn imports via land ports in order to promote the use of domestically produced yarn in the garment industry.

In a letter addressed to the NBR chairman, the tariff commission suggested continuing yarn imports through seaports as before, until appropriate infrastructure is developed in all land and rail routes, land ports, and customs houses adjacent to the borders to determine yarn count in accordance with international standards, thereby ensuring the protection of the domestic textile industry.

In response, NBR chairman Abdur Rahman Khan issued an order in this regard. However, the import of yarn may still be carried out via sea or other non-land routes.

Sources said yarn produced in the northern and southern regions of India is stored in warehouses in Kolkata before being transported to Bangladesh. This yarn enters the country at relatively lower prices. As a result, yarn imported via land ports has been used more extensively than locally produced yarn.

The Bangladesh Textile Mills Association (BTMA) has claimed that this has caused significant harm to the domestic textile industry.

Sources further indicate that although the prices of yarn produced in China, Turkey, Uzbekistan, and Bangladesh are relatively similar, Indian yarn imported via land ports is significantly cheaper.

In fact, the prices of yarn imported through land ports are much lower than the prices declared at the Chattogram customs house. Consequently, domestic yarn manufacturers are struggling to remain competitive in the market.​

 

[Bilal9]

US thread supplier opens new manufacturing facility in Ctg​

The facility is expected to increase production capacity, improve service levels, and shorten lead times, enabling A&E to deliver high-quality thread products more efficiently, the company said in a blog post on 20 March​

Global thread supplier American & Efird (A&E) has officially opened its 24th production facility in Chattogram, marking a milestone in its global expansion.

According to the yarn manufacturer, this new state-of-the-art facility will strengthen A&E's manufacturing network and increase its capacity to meet the growing demand for innovative thread solutions across Bangladesh and South Asia.

Strategically located near Chattogram's bustling seaport and financial hub, the new plant complements A&E's existing operation in Gazipur, further cementing the company's commitment to the region.

The opening was celebrated with a ribbon-cutting ceremony attended by key industry figures, customers, suppliers, partners, and government officials.

Guests were given a tour of the facility, which features cutting-edge technologies and scalable production processes.

The facility is expected to increase production capacity, improve service levels, and shorten lead times, enabling A&E to deliver high-quality thread products more efficiently, the company said in a blog post on 20 March.

Jeffrey P Pritchett, CEO of Elevate Textiles (A&E's parent company), expressed his enthusiasm, saying, "This facility enhances our ability to support customers globally while maintaining A&E's high standards of excellence. It reflects our long-term growth vision and commitment to providing innovative thread solutions."

He added, "The new facility features advanced production lines for spun and filament threads, incorporates green technologies to reduce environmental impact, and will serve as a regional hub for innovation, focusing on sustainable thread solutions."

In addition to strengthening A&E's manufacturing base, the new plant will create more than 350 local jobs, contributing to economic growth in the region.

Chris Alt, president of A&E, said, "This facility will allow us to meet the growing demand for our thread and specialty yarn products with greater speed and precision."

Angelo Leanage, managing director of A&E South Asia, emphasised that the facility's impact goes beyond production, with benefits for social development and regional growth.

"With this expansion, we continue our mission of delivering high-quality products and services while fostering economic progress in the region."

According to the company, this new plant is a key part of A&E's broader strategy to strengthen its leadership position in the global textile industry, building on a legacy of excellence that dates back to 1891. The Chattogram facility is set to play a pivotal role in shaping the future of thread solutions for the textile sector.

 

[Saif]

RMG exports grew 10.84pc in July-March

The country’s readymade garment exports witnessed a healthy growth of 10.84 per cent during the July-March period of the current financial year fetching $30.25 billion that highlights the resilience and potentials of the apparel sector...

www.newagebd.net

RMG exports grew 10.84pc in July-March
Bangladesh Sangbad Sangstha . Dhaka 17 April, 2025, 22:26

New Age file photo

The country’s readymade garment exports witnessed a healthy growth of 10.84 per cent during the July-March period of the current financial year fetching $30.25 billion that highlights the resilience and potentials of the apparel sector.

This was revealed since the Export Promotion Bureau recently published the country-wise export data for the July-March period of the financial year 2024-25.

The data revealed that the European Union continues to be a pivotal market, which represented 49.82 per cent of Bangladesh’s total RMG exports, with a total value of $15.07 billion.

Exports to the United States reached $5.74 billion, representing 18.97 per cent of the total share, while Canada totalled $963.85 million with a 3.19 per cent market share, and the UK market was also important, with exports worth $3.36 billion, which is 11.10 per cent of Bangladesh’s total RMG exports during the specified period.

Regarding growth, Bangladesh’s RMG exports to the EU grew significantly by 11.31 per cent year-over-year, with the USA demonstrating a strong increase of 17.23 per cent and Canada registering an increase of 15.66 per cent. However, RMG exports to the UK exhibited a more modest growth rate of 4.14 per cent.

Within the EU, Germany stood out as a significant market, with Bangladesh’s exports valued at $3.80 billion, followed by Spain at $2.65 billion, France at $1.65 billion, Italy at $1.17 billion, Poland at $1.26 billion, and the Netherlands at $1.61 billion.

Growth rates were especially notable in Germany (10.72 per cent), France (10.75 per cent), the Netherlands (23.15 per cent), Poland (10.32 per cent), Denmark (12.80 per cent), and Sweden (19.96 per cent).

Bangladesh’s RMG sector also showcased growth in non-traditional markets, with an overall rise of 6.66 per cent, where total exports reached $5.12 billion, capturing 16.93 per cent of Bangladesh’s total exports, indicating potential for further expansion.

Among these markets, Japan led with imports totalling $960.45 million, followed by Australia at $653.64 million and India at $535.15 million.

Exports to countries such as Turkey and Mexico are significant as well, amounting to $357.22 million and $251.22 million, respectively, with a commendable growth rate of 20.45 per cent by India, 10.06 per cent by Japan, 23.44 per cent by Mexico, and 32.54 per cent by Turkey.

While growth in Japan, Australia, India, Turkey, and Mexico is positive during this timeframe, exports to Russia, Korea, the UAE, and Malaysia have diminished.

Negative growth in the UAE, Malaysia, and Korea suggests the need for further efforts in these markets.

The knitwear sector has shown a total growth of 11.22 per cent, while growth has suffered particularly in non-traditional markets. The woven sector has also seen a growth of 10.40 per cent, with slower growth in the UK but considerably higher growth in non-traditional markets.

The ongoing growth in exports significantly depends on the EU and USA, which continue to be the main markets for Bangladesh, indicating further potential within these areas.

Talking to BSS, Mohiuddin Rubel, former director, BGMEA, managing director, Bangladesh Apparel Exchange and additional managing director, Denim Expert Ltd, said it shows the significance of the major/traditional markets in our total export growth.

‘The moderate growth in the non-traditional market underscores the importance of further research and focus in this category, as it possesses substantial growth potential, which will also help to balance reliance on traditional markets,’ he said.

Rubel also said that persistent global trade tensions are constantly reshaping the global environment, creating opportunities that Bangladesh could take advantage of.​

 

[Saif]

Rethinking Bangladesh’s garment exports

SINCE Donald Trump took office once again as the 47th president of the United States, the re-imposition of tariffs on global imports has brought the issue of trade wars back to the forefront of policy and academic debate. While the first Trump presidency initiated the use of tariffs and...

www.newagebd.net

Rethinking Bangladesh’s garment exports
Muhammad Mohiuddin 18 April, 2025, 00:00

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

SINCE Donald Trump took office once again as the 47th president of the United States, the re-imposition of tariffs on global imports has brought the issue of trade wars back to the forefront of policy and academic debate. While the first Trump presidency initiated the use of tariffs and non-tariff barriers — including the restriction of access to strategic technologies — to target Chinese firms, these measures did not abate under president Joe Biden. On the contrary, the policies were sustained and expanded in scope. The resurgence of Trump in 2025 signals an even more determined pursuit of this agenda, with wider implications across the global trading landscape.

Though widely criticised, particularly by trade liberalists, these policies cannot be analysed in isolation from the broader trajectory of American industrial history and the socioeconomic imperatives now confronting the United States. Amid growing concerns about stagnation, inequality and dependency on foreign manufacturing, reindustrialisation, domestic entrepreneurship and innovation have re-emerged as political priorities. This reconfiguration of the global trade order will likely persist, with long-term effects on global value chains (GVCs). It is thus imperative for countries like Bangladesh to rethink their positioning within global value chains — adjusting both upstream and downstream engagements based on geopolitical shifts and national capacities.

The very logic of the global production network is undergoing revision. Economic efficiency and cost optimisation, once paramount, now coexist with geo-economic and strategic calculations. China, targeted most aggressively since the first wave of Trump-era trade interventions, has shown considerable agility in adapting its supply chains. Yet, not all economies are equally equipped to respond in kind.

Until 2022, China held the position of the United States’ largest import source, accounting for 21 per cent of total imports. Recognising early the redirection of American trade priorities, China strategically reduced its exposure to the US market and redirected a growing share of its exports to the global South. Presently, over half of China’s exports are absorbed by developing markets, signifying a historic shift. Meanwhile, the ‘Made in China 2025’ initiative — backed by substantial investment in domestic technology — has begun to yield tangible results. At the same time, the Belt and Road Initiative has expanded China’s infrastructural and commercial influence far beyond its borders.

Despite formidable restrictions, such as the CHIPS Act and export controls preventing Dutch firm ASML from supplying critical semiconductor technology, China has responded with robust research and development investments, an assertive expansion into artificial intelligence and nanotechnology, and a realignment of its export strategy. As a result, the US share in Chinese exports has fallen from 22 per cent to 15 per cent, demonstrating China’s evolving resilience.

Bangladesh, of course, is not China. It lacks the same technological base, resource endowment, and geopolitical leverage. Nonetheless, there are instructive lessons to be drawn from China’s response, particularly around trade diversification, technological self-sufficiency and strategic engagement with emerging markets. Bangladesh’s rise as the second-largest exporter of readymade garments owes much to its role in global value chains, especially in the labour-intensive, low-cost manufacturing segment. However, this model is now under severe strain.

Over four decades, the structural conditions of the RMG sector in Bangladesh have remained largely unchanged. The industry relies heavily on imported intermediate inputs, is overly dependent on lead firms based in developed countries, and focuses predominantly on two key export markets — the European Union and the United States. This concentration exposes the industry to significant external shocks, such as the current wave of tariff impositions. But these vulnerabilities are not new. Even before the trade war, the sector was grappling with existential challenges: political instability, loss of preferential treatment post-LDC graduation, lack of value addition and intensifying global competition.

The tariff shock has merely underscored the urgency of long-overdue reforms. A strategic recalibration is essential, starting with the diversification of sources for raw materials and intermediate inputs. Bangladesh must reduce its dependence on China and India by exploring alternative suppliers. There is untapped potential in Pakistan, the Central Asian republics and even the United States for procuring textiles and cotton. Several Central American countries, for instance, use US-grown cotton to manufacture RMG products for export back to the US, enjoying duty-free, quota-free access under trade agreements. A similar arrangement could be pursued by Bangladesh, thus embedding its exports more strategically within US supply chains and incentivising American policymakers to reconsider punitive tariff measures.

In an era where economic nationalism defines trade policy, appealing to fairness alone is insufficient. Demonstrating business value to the American economy is essential. A mere diplomatic appeal for tariff waivers will not suffice. Trade engagement must be backed by tangible economic logic.

To this end, Bangladesh’s RMG sector must also move away from its traditional dependency on low-cost, labour-intensive manufacturing. Investment in skill development, technology adoption and product upgrading is no longer optional. Public policies must create an enabling environment for the industry to climb the value ladder. Targeted incentives for research, design, and innovation, as well as improved training infrastructure, can help Bangladesh attract companies looking to relocate from China and Vietnam.

Beyond production upgrades, strategic reforms are required in trade policy. Export market diversification remains an urgent priority. Many African and South American economies have a growing demand for RMG products — demand which is currently being met indirectly through intermediaries in Dubai or Europe. Directly accessing these markets, through bilateral agreements or business-to-business initiatives, would reduce Bangladesh’s exposure to developed markets and enhance profitability.

Similarly, Bangladesh must better engage with the Gulf Cooperation Council market. At present, economic relations with Gulf states are dominated by low-skilled labour migration. Indian traders dominate RMG exports to the region. Bangladesh has yet to fully explore this potential, despite its existing cultural and religious ties to the Gulf. With strategic diplomacy and logistical investments, the Gulf Cooperation Council could become a key growth area for Bangladeshi exports.

Another critical front is economic diplomacy with neighbouring giants India and China. Bangladesh faces steep trade deficits with both, and non-tariff barriers continue to restrict market access. Negotiating the removal of such barriers, especially for RMG and other manufactured goods, could dramatically alter Bangladesh’s export dynamics. In such efforts, trade negotiation teams must include professionals with deep sectoral expertise rather than relying solely on bureaucrats.

Simultaneously, the policy community must prepare for the post-LDC transition. Graduation to lower-middle-income status brings not only reputational gain but also the erosion of trade preferences. Bangladesh should proactively negotiate phase-out periods or transitional arrangements that delay the imposition of new tariffs. Moreover, bilateral free trade agreements with major export destinations — particularly the EU and the US — must be explored. Unlike free tariff agreements with direct competitors, free tariff agreements with advanced economies are unlikely to result in market flooding. Rather, they can enhance Bangladesh’s competitiveness in sectors where it holds comparative advantage. Careful due diligence and market analysis are needed to evaluate the terms of such agreements.

If successfully negotiated, such agreements could unlock not only preferential access but also attract greater foreign direct investment in high-tech sectors. Foreign direct investment inflows, accompanied by technology transfer and management know-how, could significantly raise the productivity and value addition of Bangladesh’s RMG sector. This will be crucial as low-cost mass production becomes increasingly unviable for many competitors, including China and Vietnam, where wage and compliance costs are rising.

Importantly, competitiveness in RMG does not hinge solely on labour costs. Labour contributes merely 18–20 per cent of total production costs. Infrastructure, logistics, administrative efficiency, and financial services all play a critical role. Improvements in port operations, customs administration, banking, and regulatory institutions are therefore vital. Without such structural reforms, gains in productivity and scale will remain constrained.

In conclusion, the trade war presents both a threat and an opportunity for Bangladesh’s RMG industry. While the crisis exposes structural weaknesses, it also provides a pivotal moment to rethink the country’s place in global trade. Through investment in skills, infrastructure, technological capacity and strategic diplomacy, Bangladesh can transform external pressures into a catalyst for sustainable growth. What is required now is not just policy realignment but a national vision for industrial upgrading and global integration — one that anticipates change rather than merely reacts to it.

Dr Muhammad Mohiuddin is a professor of management at Laval University, Quebec, Canada.​