[🇧🇩] Textile & RMG Industry of Bangladesh

[Saif]

Financial inclusion among garment workers low: Experts

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

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Financial inclusion among garment workers low: Experts

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

 

[Saif]

Bangladesh skips India, reroutes global textile exports through Maldives

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

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Bangladesh skips India, reroutes global textile exports through Maldives

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

 

[Saif]

What's causing the unrest among factory workers?

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

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What's causing the unrest among factory workers?

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

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

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

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

Is there a political aspect influencing these labour issues?

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

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

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

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

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

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

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

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

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

 

[Saif]

Denim demand rebounds gradually: experts

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

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

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

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

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

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

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

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

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

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

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

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

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

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

He also suggested investing more in people and their development.

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

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

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

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

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

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

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

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

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

 

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Garment exporters prefer cheaper Maldives, bypassing Dhaka, Indian airports

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

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Garment exporters prefer cheaper Maldives, bypassing Dhaka, Indian airports

File photo

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

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

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

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

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

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

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

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

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

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

 

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Collaborative approach needed for RMG sector growth: experts

Experts on Wednesday said that the country needed a collaborative approach from the government and the stakeholders of garments sector to utilise the huge potential of the sector.

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Collaborative approach needed for RMG sector growth: experts
Staff Correspondent 06 November, 2024, 22:27

Civil aviation and tourism ministry secretary Nasreen Jahan as chief guest inaugurates 23rd Bangladesh edition of the Textile Series of Exhibitions hosted by CEMS-Global USA at the Bangladesh-China Friendship Exhibition Centre, Purbachal in Dhaka on Wednesday. Export Promotion Bureau vice-chairman and BGMEA administrator Md Anwar Hossain, BKMEA president Mohammad Hatem and CEMS Global USA and Asia-Pacific president and group managing director Meherun N Islam, among others, were present. | Press release photo

Experts on Wednesday said that the country needed a collaborative approach from the government and the stakeholders of garments sector to utilise the huge potential of the sector.

They made the remark at the inaugural session of the ‘Textile Series of Exhibitions’, organised by New York-based multinational exhibition and convention organiser CEMS-Global USA at the Bangladesh-China Friendship Exhibition Centre at Purbachal in Dhaka.

The Bangladesh edition of CEMS-Global’s Textile Series of Exhibitions features ‘23rd Textech Bangladesh 2024 Expo’ which offers opportunity for industry people to explore the latest innovations in textile production, garment machinery, and related technologies, ‘22nd Dhaka International Yarn and Fabric Show 2024’ which exhibits the collections of yarn, fabric, trims, and accessories, and ‘45th Dye+Chem Bangladesh 2024 International Expo’ which focuses on dyestuff, fine and specialty chemicals.

Export Promotion Bureau vice-president Md Anwar Hossain said, ‘Globally, the total turnover of apparel sector is about $2 trillion, whereas we export only about $40 billion. To utilise the prospects, we need investments as well as policy support from the government.’

Anwar, also the administrator of the Bangladesh Garment Manufacturers and Exporters Association, said, ‘The most challenging thing in front of us is skilled human resources. We need a collaborative initiative on this aspect from the government, business owners and workers of the readymade garments sector.’

Meherun N Islam, president and group managing director of CEMS Global USA & Asia-Pacific, said that these exhibitions were the largest business-to-business meeting place held in Bangladesh for buyers and suppliers, where they could work through direct contact to expand business.

‘As these exhibitions are the largest gathering of foreign and domestic suppliers, buyers and sellers - Bangladeshi businesspeople do not have to go abroad to find buyers or face visa complications, saving money, labour and time,’ she said.

‘Besides, foreign buyers and sellers coming to the exhibition also add a different dimension to Bangladesh’s travel tourism,’ she added.

Nasreen Jahan, secretary of the civil aviation and tourism ministry, said that the government was working alongside the private sector in order to improve the tourism sector in the country.

‘This event is important in terms of unlocking the business prospects in the readymade garments sector, as well as the tourism sector of Bangladesh, as the exhibition brings people from all over the world to this country,’ she said.

Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association, among others, was present in the programme.​

 

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Taiwan Textile Federation delegation meets BGMEA administrator to discuss trade, investment

A delegation from the Taiwan Textile Federation (TTF) met with BGMEA Administrator Anwar Hossain to discuss potential areas of collaboration for mutual trade benefits in the apparel and textile sectors. The delegation was led by Justin Huang, President of the Taiwan Textile Federation. The meetin

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Taiwan Textile Federation delegation meets BGMEA administrator to discuss trade, investment
FE ONLINE REPORT
Published :
Nov 09, 2024 21:18
Updated :
Nov 09, 2024 21:18

A delegation from the Taiwan Textile Federation (TTF) met with BGMEA Administrator Anwar Hossain to discuss potential areas of collaboration for mutual trade benefits in the apparel and textile sectors.

The delegation was led by Justin Huang, President of the Taiwan Textile Federation.

The meeting, held on Saturday (Nov 9) at the BGMEA Complex in Uttara, Dhaka, was also attended by representatives from the Bangladesh Investment Development Authority (BIDA), Bangladesh Economic Zones Authority (BEZA), and Bangladesh Export Processing Zones Authority (BEPZA).

The discussion covered various trade-related issues, including the current market situation of ready-made garments, global trends, challenges, opportunities, and more.

During the meeting, the potential for knowledge and skill sharing in areas such as technological adaptation, capacity building, innovation, resource efficiency, and circularity within the apparel and textile industries through cooperation was highlighted.

Both sides also discussed how they could collaborate to identify potential trade and investment areas and capitalise on opportunities in the textile and apparel sectors.

BGMEA Administrator Mohammad Anwar Hossain emphasised Bangladesh's increasing focus on boosting non-cotton and high-value garment production.

He mentioned that BGMEA is making every effort to facilitate sustainable growth in Bangladesh’s garment industry through the shift from cotton-based products to non-cotton items, particularly man-made fibre-based products.

In this regard, Taiwan could consider investments in non-cotton textiles, technical textiles, woven textiles, skill development, and innovation in Bangladesh.

He encouraged Taiwanese businesses to invest in these areas, either directly or through joint ventures.

Both sides expressed optimism about working together to achieve mutual benefits in the apparel and textile sectors.​

 

[Saif]

Decision on new wage for RMG workers by April

The decision on whether to formulate another minimum wage for garment workers after making adjustments in line with inflation will be made by April next year.

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Decision on new wage for RMG workers by April
Labour ministry report says

The decision on whether to formulate another minimum wage for garment workers after making adjustments in line with inflation will be made by April next year.

A committee, headed by an additional secretary from the Ministry of Labour and Employment, has already been formed to re-evaluate the minimum wage, it was informed yesterday during a meeting, which was to discuss the progress on the 18-point demands raised by workers in September this year.

The demands were agreed upon by both workers and factory owners following negotiations mediated by the interim government.

The meeting, chaired by Asif Mahmud Shojib Bhuiyan, adviser to the Ministry of Labour and Employment, was held at the Secretariat.

The committee will submit recommendations on the feasibility and imperatives to review the minimum wage to the Ministry of Labour and Employment by April 2025.

The committee, which consists of three representatives each from labour and factory owners, has already held two meetings. The next one will be held on November 20.

Furthermore, over 99 percent of factories under the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) have implemented the previous minimum wage, as promised by the factory owners, according to a report from the Ministry of Labour and Employment.

In late November last year, the minimum wage board finalised Tk 12,500 as the minimum monthly salary for garment workers.

According to the report, at least 2,121 factories out of 2,140 had implemented the minimum wage by October this year, with the remaining 19 yet to comply.

The report further noted that out of the 2,140 factories, 2,123 have cleared workers' arrears for September, while 17 factories have not yet done so.

After the meeting, Asif Mahmud said implementing arrears is a complex issue as some factory owners have gone bankrupt. He added that those factory owners could not take money from banks as they were defaulters.

Furthermore, after the political changeover, the garment sector was rocked by labour unrest in September and October this year, which caused production losses of nearly $400 million.

"Only three months have passed since the interim government took office. The overall labour situation is improving. It was dire when we assumed office," he added.

Labour and Employment Secretary AHM Shafiquzzaman said that the labour law will be amended by March next year to align with international standards.

"The labour law amendment will be carried out through an ordinance by March," he added.

The country pledged to amend the labour law at the 352nd session of the International Labour Organization (ILO) Governing Body, held from October 28 to November 7 in Geneva.

A tripartite committee is currently working on possible amendments to the law, including easing trade union rules and documentation requirements.

Regarding service benefits, the progress report stated that benefits are being provided as per labour law.

The report also mentioned that Section 27 of the Labour Law and related sections will be amended.

Additionally, the responsibility for preparing a proposal to provide contributory provident funds to workers has been given to the Department of Inspection for Factories and Establishments, the report stated.

The report also mentioned that the Ministry of Labour and Employment has formed a committee to address the yearly increment.

It further stated that the Minimum Wage Evaluation Committee will submit a proposal regarding the capacity and imperatives of the yearly increment, considering current inflation and balancing it with labour law.

The committee is expected to submit its report by November 30.

The rationing system for workers through the Trading Corporation of Bangladesh is currently in process, the report noted.

Regarding the blacklisting of some workers, the Ministry of Labour and Employment has formed a technical team that will submit a report reviewing the overall situation, which is now under process.

The committee has instructed labour leaders to collect forms and submit them to the Ministry of Labour and Employment after completing them in relation to the withdrawal of cases filed against workers during the minimum wage movement in 2023.

Once submitted, the ministry will forward them to the district magistrates, the report said.

The report further said that over 80.55 percent of factories have set up daycares and the BGMEA is monitoring the remaining factories to ensure they set up daycares as well.

The Minimum Wage Board, a government regulatory agency responsible for recommending changes to the minimum wage, has also submitted a proposal to the Ministry of Labour and Employment to amend the labour law and update its provisions.

The board has suggested that the ministry amend the labour law to ensure stricter enforcement of wage structures in factories, according to the proposal.

Amending the labour law has been a long overdue issue in Bangladesh.

Last December, the president returned the "Bangladesh Labour (Amendment) Bill-2023" unsigned, citing the need for further amendments to certain key clauses.

In response to the Rana Plaza building collapse and subsequent international pressure, the government amended the 2006 labour law in August 2013 to ensure workplace safety and labour rights issues meet international standards.

In September 2015, the government formulated labour rules to guide the proper application of labour law at factories.

The law was further amended in 2018, again under international pressure, to lower the worker threshold for union formation from 30 percent to 20 percent.​

 

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Jhut sector must be formalised to prevent chaos: experts

Experts on Tuesday stressed the need for a textile waste (jhut) management policy in Bangladesh, saying that its informal nature of the sector fuelled political-economic tensions and...

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Jhut sector must be formalised to prevent chaos: experts
Staff Correspondent 12 November, 2024, 23:16

Commerce ministry additional secretary Abdur Rahim Khan, deputy head of EU delegation to Bangladesh Bernd Spanier, chief technical adviser on circular economy in global value chain at UNIDO Mark Draeck, BGMEA support committee member Rezwan Selim and Desh Group deputy managing director Vidiya Amrit Khan, among others, are present at an event at the Hotel InterContinental in the capital Dhaka on Tuesday. | Press release photo

Experts on Tuesday stressed the need for a textile waste (jhut) management policy in Bangladesh, saying that its informal nature of the sector fuelled political-economic tensions and labour unrests in the country’s readymade garment sector.

At an event titled ‘Switch to upstream circularity roundtable: path towards circularity in Bangladesh’s RMG industry’ at the Hotel InterContinental in Dhaka, they also said that an enabling policy framework was essential to drive the transition, as it could create millions of jobs in the recycling industry and reduce Bangladesh’s reliance on imports.

The event was organised under the SWITCH to Circular Economy Value Chains project, co-funded by the European Union and the Finland government.

It was led by UNIDO in collaboration with Bangladesh Garment Manufacturers and Exporters Association, Global Fashion Agenda, BESTSELLER, Reverse Resources, Chatham House, Circle Economy and the European Investment Bank.

‘The industrial textile waste market in Bangladesh remains largely informal, which has a significant political-economic impact on the sector, as seen during the recent labour unrests in the RMG sector at Ashula and the other parts of Dhaka,’ said Bernd Spanier, deputy head of the EU delegation to Bangladesh.

He said that formalising the sector was crucial, as a clear regulatory framework and enabling conditions would attract innovative recycling technologies and expertise.

The diplomat also said that the transition towards circularity could create millions of jobs in the recycling industry and reduce Bangladesh’s reliance on imports.

‘We believe that the next five years will be crucial for Bangladesh’s garment industry. Under the EU Strategy for Sustainable and Circular Textiles the EU is introducing significant initiatives in this region,’ he said.

Spanier said that garment-producing countries must transition from a linear to a circular production model to ensure that, by 2030 — which is not far away — textiles in the EU market are largely made of recycled fibres, free of harmful substances and produced in an environmentally and socially responsible manner.

Citing a recent GIZ study, he said that Bangladesh’s lack of supportive policies had contributed to shifting preferences towards countries like Vietnam and Indonesia as destinations for recycling industries.

‘We aim to retain the recycling industries in Bangladesh, but a post-industrial regulatory framework is essential, as current frameworks, such as the national environmental policy, solid waste management rules, and Bangladesh Labour Act, are not yet aligned with emerging EU and international standards for circularity in textile manufacturing and waste management,’ Spanier added.

Commerce ministry additional secretary Abdur Rahim Khan said that in Bangladesh, jhut business was not an economic issue now, but it turned into a law and order issue.

‘As you know, we face unrests within our RMG sector, and some of my colleagues suggest that jhut business is contributing to this instability,’ he said.

Rahim Khan emphasised the need to establish a policy for jhut waste management, saying that it would not only support the transition to circularity, but also help address the unrests currently affecting the RMG sector.

Now it is time for Bangladesh to have a proper coordination between three stakeholders — manufacturers, waste management companies and global brands.

If these stakeholders work together, transformation is likely to occur; otherwise, despite discussions and dialogues, real change may not take place, Rahim Khan observed.

Chief technical adviser on circular economy in global value chain from UNIDO Mark Draeck said that in the textile industry, especially regarding circularity, things were more complex, which was why progress had not been straightforward.

He highlighted two concrete pilot projects they are working on, closely collaborating with both brands and manufacturing companies to address challenges at the technology, logistics, economics and traceability levels.

However, to scale these initial experiences across the industry, more systemic challenges, including policy, capacity building, access to finance and the necessary investments for this shift must be addressed, Draeck observed.

BGMEA support committee member Rezwan Selim, Desh Group deputy managing director Vidiya Amrit Khan and global Fashon Agenda stakeholder consultant Shamiul Hoque, among others, spoke at the event.​

 

[Saif]

Towards a zero-waste textile sector

Given the highly pollutant nature of the textile and fashion industry, the Western importers of textile products from developing nations including Bangladesh want to see that waste generated by the industry is managed efficiently and sustainably. In the textile industry, which is dominated by

thefinancialexpress.com.bd

Towards a zero-waste textile sector
Published :
Nov 15, 2024 21:24
Updated :
Nov 15, 2024 21:24

Given the highly pollutant nature of the textile and fashion industry, the Western importers of textile products from developing nations including Bangladesh want to see that waste generated by the industry is managed efficiently and sustainably. In the textile industry, which is dominated by the Readymade Garment (RMG) factories in Bangladesh, in addition to the chemicals or various solid wastes generated during manufacturing process, pieces of cloths or textiles from which garment articles are produced also become waste called garment waste. The informal business involving textile or garment waste, or jhut in Bangla, is a major socio-political issue here as it has given rise to violent turf wars among jhut traders. So, proper management of textile waste is more than being environmentally conscious. As the garment waste or jhut is behind eruption of occasional violence and labour unrest, addressing the issue urgently and efficiently has now become a priority before the government and the industry operators. Against this backdrop, a roundtable titled, 'Switch to Upstream Circularity: Path Towards Circularity in Bangladesh's RMG Industry' was recently organised in the city where the industry people, government leaders, international development partners as well as brand representatives participated. As it emerged from the discussion event in question, it is the informal nature of the textile waste market here that lies at the heart of the prevailing crisis in the sector. The answer to it is going circular which is about reducing waste, reusing and recycling it thereby converting the waste into more useful value-added items (upcycling).

Hence, experts on the issue suggest that by adopting an appropriate policy, the garment waste that is now presenting itself as a nuisance can revolutionise the entire outlook of the industry by not only reducing the sector's dependence on import of raw materials but also creating a large number of new jobs through establishing recycling industries. That is also important for stimulating the export of garment products for the simple reason that modern environment-conscious consumers in the West appreciate value-added upcycled textile products. But the only way of transitioning to the next phase of the industry where there is no concept of waste, Bangladesh should introduce the needed technology and expertise in the textile sector. Until that is done, Bangladesh's textile or apparel sector will lag behind its regional and international competitors and helplessly watch the shift of the technology and expertise to the Southeast Asian countries like Vietnam and Indonesia.

However, the main roadblock to this path of progress is the existing regulatory framework which is unhelpful to formalising the textile waste or jhut market. Of necessity, the new regulatory framework will have to be a post-industrial one that will revamp, for example, the present national environmental policy, solid waste management rules, Bangladesh Labour Act, etc., in order that they are in line with the emerging international, particularly the EU standards for circularity in textile manufacturing and waste management. Some international experts held that the next five years (till 2030) will be crucial for Bangladesh's apparel industry since by then it will be required to meet the EU Strategy for Sustainable and Circular textiles. The EU market, which is an important destination of the country's apparel exports, will look for textile products that are recycled fibres, free from harmful substances and produced in an environmentally as well as socially responsible manner.

In that case, the primary task before the government now is to come up with a clear regulatory framework that would formalise the textile waste sector and thus create the desired enabling conditions for it to attract the necessary knowhow and innovative recycling technologies.​

 

[Saif]

The barriers to unionisation in the garment industry

Bangladesh has a class problem which deters from effective conversations about the many barriers to operational unionisation in the garment industry.

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The barriers to unionisation in the garment industry

Although worth a staggering amount of $55 billion a year, the industry’s infrastructure is far from perfect. Be it political unrests in the country, sustainability concerns from pressure groups or worker dissatisfaction, it is riddled with issues that need to be urgently addressed. PHOTO: AFP

According to the World Trade Organisation (WTO) Bangladesh boasts the title of being the second largest global RMG exporter. The garments sector has contributed to transforming the local economy to lower-middle income from one that was worryingly below the poverty line. Although worth a staggering amount of $55 billion a year, the industry's infrastructure is far from perfect. Be it political unrests in the country, sustainability concerns from pressure groups or worker dissatisfaction, it is riddled with issues that need to be urgently addressed. Not to mention that workers are paid less than a living wage, which is not inflation adjusted to the soaring costs.

Bangladesh has a class problem which deters from effective conversations about the many barriers to operational unionisation in the garment industry. Without trade unions, it is difficult to address safety issues and elevate workers to fair wages and improved working conditions. The Labour Act 2006 governs labour relations and workers' rights in myriads of sectors of Bangladesh with an entire chapter dedicated to trade unions and industrial relations. Following the dreadful Rana Plaza collapse, the legislation had various amendments made to it to ensure workplace safety, maintain health standards and improve workers' rights and representation. Additionally, to ascertain that the formation and registration of trade unions is facilitated, provisions were strengthened.

While this Act explicitly grants permission for trade unions to be formed, a minimum of 20 percent of workers within the same establishment are required to register one. The registration process is dauntingly bureaucratic and involves extensive paperwork. By the virtue of this legislation, the registered trade unions have the right to represent their members and can engage in collective bargaining on behalf of their members and negotiate better wages, working conditions, and other benefits. Employer interference through imposing any contractual obligations on workers to not join any union, dismissal or discrimination of workers who are members of any union, and refusal of employment on such grounds is deemed unlawful through the Labour Act 2006.

It has been established that on paper there is a comprehensive guide for operation of this in an ideal world, but the reality is far from it. The implementation is dangerously deficient. Lack of awareness of the workers themselves prevent them from recognising the benefits of collective bargaining. It does not help that the legislation is riddled with legal jargons that a lay person cannot comprehend. Workers in the garment sector also fear ramifications from employers as they consider themselves low skilled and highly replaceable. There is sufficient precedence of fear mongering by employers in this regard with reports of intimidation, harassment, and retaliations against union organisers and participating workers alike. Historically, the government has been complicit in the maltreatment of workers as they often prioritise increasing the GDP of the country rather than emphasising better standards of living.

Earlier this year, following massive protests by garment industry workers, the minimum wage was increased from Tk 8,300 to Tk 12,500, whereas workers and trade unions say that Tk 23,500 is the living wage. Even this unsatisfactory increase came at the cost of the lives of four workers, while many others were left injured. Many workers were arrested without any possibility of bail. During this time, letters have been issued by big-brand buyers such as ASOS, Hugo Boss, and H&M asking for suppliers to conclude negotiations peacefully and offer the workers an adequate living wage. Buyers conveniently neglected to quote the amount asked for by the workers in those letters. So, they are indirectly colluding with the employers in the maltreatment of these workers by not up taking the cost of increasing the minimum wage.

Despite legal frameworks being present, it could prove to be useful to simplify the union registration process. Many NGOs and grassroot organisations are running awareness campaigns to ascertain that workers are aware of their rights to unionise. However, it is pertinent for the government to also be involved in the process and detract from the unfair power dynamics between the workers and employers. Employers should face penalisation for engaging in intimidation or any other unfair practices to prevent workers from forming unions. International pressure by purchasers on employers in the garment industry should be more than just condemnations on paper, it should be more than hollow commitments to support a minimum wage, and they should reaffirm the exact amount demanded by the unions and workers.

The barriers to effective unionisation by workers in Bangladesh remain a critical issue and tackling it is the first step to creating a long overdue fair and equitable working environment for the blue-collar workers on whose backs this country runs.

Raina Sabanta is a barrister.​

 

[Saif]

Preparations needed to address 4IR automation job losses: experts

Experts at a programme on Saturday said that Bangladesh should make timely preparations to address the job losses automation could cause in the readymade garment and textile sector...

www.newagebd.net

Preparations needed to address 4IR automation job losses: experts
Staff Correspondent 16 November, 2024, 22:48

A file photo shows workers sewing clothes at a readymade garment factory at Savar, on the outskirts of Dhaka. Experts at a programme on Saturday said that Bangladesh should make timely preparations to address the job losses automation could cause in the readymade garment and textile sector. | New Age photo

Experts at a programme on Saturday said that Bangladesh should make timely preparations to address the job losses automation could cause in the readymade garment and textile sector.

According to a study report released at the inaugural ceremony of a two-day symposium titled ‘The 4th Industrial Revolution: impact on workers and employment and the need for inclusive policies’, automation could displace 60 per cent of the workforce in Bangladesh’s RMG and textile sector from their traditional roles by 2041 although a significant number of new types of jobs would emerge in the sector during this period.

The Bangladesh Institute of Labour Studies in collaboration with the International Labour Organisation organised the event at the CIRDAP auditorium in the capital Dhaka.

Experts stressed the urgent need for government action to protect, upskill and reemploy workers facing both short- and long-term risks from the 4th Industrial Revolution.

They called for the involvement of workers, trade unions, employers and the civil society in this process.

Skill development was highlighted as a key priority, requiring strategic planning for successful implementation.

Labour secretary AHM Shafiquzzaman said that that Bangladesh must align itself with the global shift towards the 4th Industrial Revolution, stressing that now is the time to make necessary preparations.

He underscored the importance of making timely policy decisions to mitigate the risks to workers’ employment arising from the 4th Industrial Revolution, while also leveraging technology to benefit the country.

Information and Communication Technology Division additional secretary Abu Sayed Md Kamruzzaman said that it was crucial to define the term ‘worker’ accurately and establish ethical standards for the use of artificial intelligence.

The event was presided over by BILS vice-chairman Md Mujibur Rahman Bhuiyan, with the opening speech delivered by BILS executive director Syed Sultanuddin Ahmed.

The study revealed that up to 5 lakh jobs at the operator level, including those handling single and double needle lockstitch machines, chain stitch machines, and sewing mechanics, were at risk in the apparel and textile sector.

It also found that floor supervisors and pattern makers could see a loss of 10,000 positions, with another 10,000 jobs in quality control, production planning and merchandising potentially disappearing as well.

Even high-skilled roles, including fashion designers, CAD-CAM operators, portfolio developers, and production controllers are not immune, with an additional 10,000 jobs at risk, said the report which was presented by iSocial Limited chief executive officer Ananya Raihan at the programme on Saturday.

He said that in 2022, the machine-to-human work ratio was 44 per cent to 66 per cent, respectively, but by 2035, it was expected to shift to 57 per cent and 43 per cent.

The report highlighted alarming job losses due to automation across five major industries: the RMG and furniture sectors, each projected to lose 60 per cent of jobs, the agro-food processing industry with a 40-per cent reduction, the leather sector facing a 35-per cent decline and the tourism sector anticipating a 20-per cent job loss.

The report said that the automation in the RMG and textile sector was creating new jobs that combine technology with traditional manufacturing processes.

Key emerging occupations include professionals skilled in computer-aided process planning, quality control, and training, as well as those working with automated inspection and material handling systems, it said.

According to the report, jobs such as artificial neural network experts, pick-and-place robot operators, numerical controllers, and automated fusing and pressing machine operators were becoming increasingly important.

Enterprise resource planning experts are also in demand to optimise production and resource management, it said.

The study revealed that jobs in customer service, retail checkout, data entry, assembly lines and translation were increasingly replaced by technology.

Financial analysis, graphic design, content writing, supply chain management, legal counselling, and accounting jobs have also started to be lost.

Meanwhile, the fastest-growing jobs from 2023 to 2027 include AI and machine learning specialists, sustainability specialists, business intelligence analysts, information security analysts, fintech engineers, data analysts and scientists, robotics engineers, big data specialists, agricultural equipment operators, and digital transformation specialists.

The study found bank tellers, postal clerks, editors, cashiers, data entry clerks, secretaries, accounting staff, legislators, finance clerks and door-to-door sales workers as fastest-declining jobs from 2023 to 2027.

The event also featured speeches from NCCW chairman Badal Khan and Samajtantrik Sramik Front president Rajequzzaman Ratan, among others.​

 

[Saif]

Labour unrest puts huge strain on RMG industry

The labour unrest that broke out in Ashulia in late August and spilled over to Gazipur has put enormous impacts on the billion-dollar garment industry, according to sector insiders. The impacts include shift in work orders to other places inside and outside the country and also a halt in massive i

thefinancialexpress.com.bd

Labour unrest puts huge strain on RMG industry
Monira Munni
Published :
Nov 18, 2024 00:07
Updated :
Nov 18, 2024 00:07

The labour unrest that broke out in Ashulia in late August and spilled over to Gazipur has put enormous impacts on the billion-dollar garment industry, according to sector insiders.

The impacts include shift in work orders to other places inside and outside the country and also a halt in massive investment plans.

Entrepreneurs are now struggling to cope with the production deadline and costs as many apparel factories have to suspend operations in fear of vandalism.

Some of them have to renegotiate with their buyers for deferment or air shipments, they noted.

Talking to the FE, an official at a textile group said their company halted the investment plan though structure is ready in Bhulta area of Narayanganj.

"We are not installing the machinery at this moment mainly because of the labour unrest to wait and watch what will be happening," he noted.

Mohammed Sohel, managing director of Bangla Poshak Ltd, said due to three days' protest by TNZ workers, he was likely to send some of his shipments by air if he failed to produce them in a couple of days.

"My workers did overtime on Thursday and worked on Friday to meet the deadline," he said, adding that these have a negative impact on their productivity too.

Mr Sohel said all these might have an additional cost up to Tk 0.7 million.

Buyers, mostly non-branded ones, are taking advantage of the situation by offering low rate or asking for discount, he noted.

Mahmud Hasan Khan, managing director of the Rising Group, said the loss they have incurred due to the labour unrest is not recoverable though buyers give some time or flexibility for delay and air shipments.

"We met the deadline by shifting the orders to my other factories in other places," he said, adding that one of his factories located in Ashulia had to suspend production due to the unrest.

Buyers have a negative notion about placing work orders in factories in Ashulia as labour unrest takes place here.

"If buyers have any option to shift to other location, they will move," he opined.

When asked, Khan Monirul Alam Shubho, managing director of the Fashion.com Ltd, said that in September buyers shifted a certain portion of work orders to other factories mainly to reach goods to their stores.

Even entrepreneurs will not want to invest in the industrial zones of Ashulia where from labour unrest started due to high occupancy of factories, labour intensiveness, trade unions and investigators.

The existing factories might not be relocated overnight due to the availability of gas connection, labour and others. But some of them are downsizing the capacity, he added.

About five per cent monthly labour migration is very common while the rate is currently up to 10 per cent and many of the factories are not recruiting new workers as they plan to run with the existing capacity, Mr Shubho noted.

Mohiuddin Rubel, additional managing director of Denim Expert Ltd, said the factories affected due to labour unrest either perform their orders in their other units located outside Ashulia or Gazipur, even in Chattogram, or subcontract work to other factories mainly to meet the deadline or avoid air shipments.

It is very usual to inter-transfer the orders in a crisis situation, he noted.

Talking to the FE, a number of exporters said a factory might have an internal problem but, based on this, a section of the workers was attacking other factories, carrying out vandalism and inciting their workers by spreading rumours.

The agreement between representatives from owners and workers on 18-point demands failed to stop such recurrence of protests.

Bangladesh Garment Manufacturers and Exporters Association (BGMEA) claims that the clothing industry has suffered a production loss of $400 million due to the labour unrest that continued until early October.

Some 39 affected factories were unable to pay wages for September because of the labour unrest, leading the BGMEA to request interest-free bank loans on easy terms from the government to support them.

According to Bangladesh Institute of Labour Studies (BILS), 96 incidents of labour unrest took place in the country's major garment industrial belts, mostly in Ashulia and Gazipur, from January to September 2024.

A majority or 39 incidents of labour protests took place over dues while 22 over various other demands, the BILS data show.

The institute recorded eight incidents of workers' protests over opening of closed units, 13 over payment of bonus, five over deaths of workers and the remaining nine over other demands.

Talking to the FE, Amirul Haque Amin, a labour leader, said some incidents of protest like that of TNZ took place mainly because of the ignorance of factory owners and agitation spread into other nearby factories.

"The government should take strict measures against the factory owners, who are not paying wages, and arrest them," he noted.

Unless the government and the BGMEA take strict measures against such acts, no peaceful situation could be expected in the country's largest foreign currency-earning sector, he said, adding that timely wage payment is most important for workers. Nazma Akter, president of the Sammilito Garments Sramik Federation, said the labour unrest took place mainly because of political shift, control over jhut or garment waste trade, allowance and other reasons. Unrest has negative impact both on industry and its business while workers also left no choice as they are not paid despite repeated commitments, she said.

Blacklisting of workers is yet to stop while cases against workers are not withdrawn, she noted.

According to BGMEA sources, eight factories in Gazipur and Mymensingh areas and two in Savar-Ashulia-Zirani area remained closed on Saturday over the labour unrest.

Five of the trade body's members did not pay wages for September and August while 11.11 per cent or 232 BGMEA listed units yet to pay wages for October until Saturday.​

 

[Saif]

COP29 and the future of Bangladesh’s RMG sector

I believe COP29 holds major promise for the future of circularity and sustainability in Bangladesh’s RMG sector.

www.thedailystar.net

COP29 and the future of Bangladesh’s RMG sector

The RMG sector faces mounting pressure to adopt circular and sustainable practices. PHOTO: STAR/FILE

COP29 offers a unique opportunity for global stakeholders to accelerate the transition towards sustainable practices in sectors that heavily impact the environment. One sector where this transformation is particularly urgent is the ready-made garment (RMG) industry in Bangladesh. The RMG sector, which accounts for a significant portion of our GDP and is a vital employment source, faces mounting pressure to adopt circular and sustainable practices. As Bangladesh joins the world at COP29, here I look at how this conference could shape the future of circularity and sustainability in our RMG sector.

Bangladesh is the world's second-largest garment exporter, supplying major fashion retailers in the US and Europe. However, the industry's contribution to the economy is accompanied by equally significant environmental challenges, including high levels of water consumption, pollution, waste, and carbon emissions. Furthermore, its linear production models, focused on high-volume, low-cost outputs, have resulted in considerable textile waste, with limited infrastructure to support recycling and reuse.

The concept of circularity entails moving from a "take-make-waste" linear model to one where resources are used, reused, and recycled, reducing waste and environmental harm. For the RMG sector in Bangladesh, circularity could mean designing garments for longevity, adopting sustainable materials, recycling textile waste, and building infrastructure that supports garment reuse.

COP29 could potentially play a critical role in establishing universal standards and frameworks for circular economy practices across industries. For the Bangladesh RMG sector, such frameworks could create clear guidelines and benchmarks for sustainable production, helping manufacturers align with global expectations and attract more eco-conscious international buyers. With standardised metrics for circularity, companies could potentially better measure and report their environmental performance, which could further increase their competitive edge in the global market.

One of the key outcomes anticipated from COP29 is an increased commitment to climate finance, which could open doors for Bangladeshi RMG manufacturers to access funding for green technologies and circular infrastructure. Why does COP29 not propose a Circular Transition Fund? This could be used to support the garment industry's shift towards the circular economy which will be a costly process. Climate finance will be key to support small and medium-sized enterprises (SMEs), which make up a significant portion of the RMG sector, adopt circular practices despite resource constraints.

For Bangladesh's RMG sector, international collaborations could provide access to new technologies and knowledge in circular textile practices. Partnering with countries that have advanced recycling systems, for example, could enable Bangladesh to improve its waste management processes and develop the capacity to recycle textile waste on a large scale. This cooperation could also promote skills exchange, where Bangladeshi workers learn techniques for sustainable garment production, ultimately benefiting the sector's sustainability efforts.

Effective policy support is crucial for driving the shift to circularity. As COP29 may influence Bangladesh's policy direction on sustainability, it's possible the government could introduce incentives to encourage RMG manufacturers to adopt circular models. For instance, tax breaks for companies that use recycled materials, subsidies for sustainable technology adoption, or grants for eco-friendly infrastructure could make circular practices more feasible for manufacturers.

As Bangladesh aligns with COP29 goals, it's essential to ensure the transition to circular practices also benefits the millions of workers in the RMG sector. This includes providing training for green jobs, ensuring safe working conditions, and fair wages. COP29 could serve as a platform to push for labour practices that support social sustainability alongside environmental objectives, ensuring a just transition for RMG workers.

One important aspect to consider is consumer behavior. To succeed in a circular economy, brands, and retailers must educate consumers on the importance of sustainable fashion and encourage responsible consumption. However, if Bangladesh seizes the opportunities presented at COP29, the RMG sector could emerge as a leader in sustainable fashion, providing a model for other developing economies. By embracing circularity, the sector could reduce its environmental impact while increasing resilience to global supply chain disruptions.

I believe COP29 holds major promise for the future of circularity and sustainability in Bangladesh's RMG sector. Through climate finance, partnerships, policy support, and a commitment to worker well-being, the conference could help cement meaningful change in how garments are produced, consumed, and disposed of.

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).​