[🇧🇩] Textile & RMG Industry of Bangladesh

[Bilal9]

Bangladesh' RMG exports to USA, in absence of tariffs that affect Indian and Chinese exports have gone up around 18% which is as of last FY (post no. 399 above).

This will go up even more this FY.

However - as you said, knit sector is facing some problems due to Bank non-cooperation.

We also need to diversify exports, which is a crying need of the day. It is happening, but not fast enough.

 

[Saif]

Apparel sector's stake in climate adaptation

The findings of a new study conducted by the Global Labor Institute (GLI) of Cornell University, USA could trigger both optimism and concern. The study suggests investing in climate adaptation can help Bangladesh fetch US$122.01 billion in apparel exports by the year 2030. On the flip side, however

thefinancialexpress.com.bd

Apparel sector's stake in climate adaptation

Published :
Dec 14, 2025 23:32
Updated :
Dec 14, 2025 23:32

The findings of a new study conducted by the Global Labor Institute (GLI) of Cornell University, USA could trigger both optimism and concern. The study suggests investing in climate adaptation can help Bangladesh fetch US$122.01 billion in apparel exports by the year 2030. On the flip side, however, it warns that without adaptation measures, exports from this sector could fall sharply to US$95.35 billion, representing a 21.85 per cent loss. The study attributes this effect primarily to lost worker productivity due to extreme heat and flooding, which subsequently takes a toll on overall industrial output. The employment forecast is equally grim in the absence of adaptation. By 2030, the failure to adapt could result in a loss of 250,000 potential jobs. Investment in climate adaptation measures, therefore, is not merely a choice but a key imperative for the future of the garment industry and many other sectors.

These losses are not hypothetical. It is driven by measurable physical realities. For example, Dhaka has seen a significant 56.1 per cent rise in the average number of hot days over 35°C in the last two decades. The prediction of days exceeding the moderate heat stress threshold is set to nearly double in Dhaka by 2050, from an already high number in 2030. This heat directly correlates with falling productivity. The study highlights that workers in Bangladesh are the most climate-vulnerable among the 21 apparel production centres assessed. This is compounded by a low climate readiness score and inadequate social protection coverage. Furthermore, the dual threat of intensifying heat and flooding cause machinery damage, material loss and significant business disruption.

The GLI report offers a set of recommendations as well. These include setting and enforcing mandatory standards for work hours, rest breaks and hydration. It also calls for investing in cooling systems and resilient infrastructure so that heat stress and flooding can be mitigated. At the same time, the study suggests classifying heat stress and floods as health hazards, allowing workers to take paid leave. The study makes it clear that climate adaptation is synonymous with economic stability and social justice for Bangladesh. The investment required now is a fraction of the catastrophic losses projected for the near future. It is time for policymakers and apparel industry entrepreneurs to heed the warning of climate change and act decisively to protect millions of livelihoods and sustain the sector's growth momentum.

Over the years, Bangladesh has made significant strides in greening the factories. The country can now boast the highest number of green garment factories in the world. However, it cannot afford to let complacency set as far greater challenges loom in future both in terms of the loss of trade privileges following the LDC graduation and climate vulnerability. In order to sustain the growth momentum in the post-LDC era, the industry must enhance competitiveness through product diversification, high-value addition, technology upgrading and skill development. The challenges ahead may seem daunting, but with concerted efforts from brands and strategic policy support from the government, the sector can secure a sustainable growth.​

 

[Saif]

Bangladesh becomes world largest cotton importer in MY25

Bangladesh became the world’s largest importer of cotton, importing 8.05 million bales in the marketing year 2024-25, which starts August 1...

www.newagebd.net

Bangladesh becomes world largest cotton importer in MY25
Brazil becomes main supplier overtaking India

Saddam Hossain 14 December, 2025, 23:33

A file photo shows a worker overseeing a cotton processing machine at a factory in Habiganj. | New Age photo

Bangladesh became the world’s largest importer of cotton, importing 8.05 million bales in the marketing year 2024-25, which starts August 1.

According to data recently released by the United States Department of Agriculture, imports were 5.2 per cent higher than in MY2023-24, at 7.8 million bales.

Bangladesh became the top cotton importer in MY25 as the textile industry continued to recover from a post-pandemic slowdown, the report added, saying that despite a political regime change, cotton imports remained stable throughout the marketing year.

Meanwhile, during MY25, Brazil emerged as the largest single supplier of cotton, surpassing India, although West Africa remained the primary source region.

According to USDA data, Bangladesh imported 1.9 million bales of cotton from Brazil in MY25, accounting for approximately 25 per cent of total imports.

The import from India stood at 1.4 million, which was 15 per cent of the total imports, followed by 1.06 million bales from Benin (13 per cent), 616,538 bales from Cameroon (8 per cent), and about 595,902 bales from the United States and Australia, each holding 7 per cent of total imports.

Regarding greater imports from Brazil than from India, the report stated that Brazilian cotton has become popular among Bangladeshi spinners due to its competitive pricing, wide availability during harvest, and stable supply.

Fazlul Hoque, former vice president of the Bangladesh Textile Mills Association, echoed a similar sentiment, noting that Brazil experienced a surge in cotton production, which kept prices comparatively low.

‘Although Brazil is far from our country, the pricing remained competitive despite the long route,’ he said, noting that Brazilian cotton sellers stocked their cotton at various ports, from where any importer could easily import.

The price of Brazilian cotton remained lower than that of West African countries and India; for this reason, the millers have been leaning toward the South American country.

Meanwhile, Brazil has long sought to increase the supply of cotton for Bangladesh’s textile sector by ensuring continuity and sustainability through strategic partnerships in Asia.

In June of 2022, Brazilian cotton businesses led by Brazilian Cotton Growers Association president Julio Cezar Busato visited Bangladesh and discussed a number of cotton millers.

In April of 2024, a delegation led by Brazilian Minister of Foreign Affairs Mauro Vieira visited Bangladesh, just after another delegation of ABRAPA visited Bangladesh on February of the same year.

During MY25, Vietnam became the second-largest importer of cotton, importing 7.9 million bales, followed by Pakistan (6.1 million bales) and China (5.1 million bales).

The report also stated that domestic cotton use in Bangladesh stood at 8.1 million bales in MY25. The USDA report forecast that for MY2025-26, the raw cotton import might increase to 8.4 million bales, up 1.4 per cent from the estimated 8.1 million bales in MY25, due to higher utilisation of raw cotton by the spinning industry.

However, textile millers stated that imports might decline in the coming months, as the country’s textile sector has been experiencing difficulties due to energy shortages and reduced demand.

Regarding domestic production, the report indicated that in the current MY26, the harvested area and production might stand at 46,000 hectares and 155,000 bales, respectively.

Cotton cultivation is fully manual in the country, relying heavily on human labour for applying fertilisers, spraying insecticides, and harvesting, the report added.​

 

[Saif]

Climate inaction could cost $27B in RMG Exports: study

Bangladesh’s earnings from the readymade garment export could miss about $27 billion by the year 2030 if the country is unable to invest in climate adaptation, especially heat stress, said a study...

www.newagebd.net

Climate inaction could cost $27B in RMG Exports: study
Staff Correspondent 21 December, 2025, 23:33

Representational image. | New Age file photo

Bangladesh’s earnings from the readymade garment export could miss about $27 billion by the year 2030 if the country is unable to invest in climate adaptation, especially heat stress, said a study.

Global Labor Institute at Cornell University conducted the study titled ‘The Heat is On: How heat stress impacts the apparel industry, jobs, and worker health,’ and released it recently.

The study stated that proper investment in climate adaptation could help Bangladesh generate about $122.01 billion from RMG exports by 2030, as heatwaves and flooding could negatively impact worker productivity.

The gap might be more pronounced in 2050, when adaptation could help earn $1,038 billion, but failure could cost Bangladesh 68.40 per cent of its potential earnings, down to $328.11 billion.

However, the study warned that if Bangladesh failed to invest, export earnings from the RMG sector could fall sharply by 21.85 per cent to $95.35 billion by 2030, about $27 billion less than the forecast.

According to the wet-bulb globe temperature cited in the study, heat stress creates discomfort for workers at 28°C, which could cause moderate heat stress at 30.5°C and high heat stress above 32°C, when workers require 30 minutes of rest after 30 minutes of work.

When the WBGT index reaches high heat stress levels of 32°C or more, workers could suffer heat exhaustion, life-threatening heat stroke, and other severe health impacts.

Moreover, heat stress also impacts worker productivity and output. For every increase of 1°C above 25°C WBGT, productivity for moderate effort in manufacturing decreases by an average of 1.5 per cent.

According to the study, Dhaka experienced temperatures of 35 degrees Celsius or more for 51.2 days on average between 2020 and 2024, a significant 56.1 per cent higher than 32.8 days in 2005-2009, which caused severe and frequent heatwaves and flooding directly impacting worker health and factory output.

Moreover, the study predicted that Bangladesh’s capital city might face 64.81 days above the heat stress threshold of 30.5 degrees Celsius Wet Bulb Globe Temperature WBGT by 2030, which would exceed 104.48 days by the year 2050.

Chattogram, a major manufacturing hub and port city, would also experience 50.10 days by 2030 and 84.86 days by 2050.

In the study, the GLI analysed climate data spanning 20 years from 2005 for 23 apparel production centers across the world, in cooperation with Better Work, the International Labour Organization, and the International Finance Corporation.

The joint study stated that the future impacts of climate change in key apparel production centers-Dhaka in Bangladesh, Phnom Penh in Cambodia, Karachi in Pakistan, and Hanoi and Ho Chi Minh City in Viet Nam, under two scenarios, the industry would work proactively to manage heat stress or no-adaptation.

The study picked the five locations because they account for 18 per cent of global apparel exports and have a combined apparel workforce of more than 10.6 million people.

Under the no-adaptation scenario, the apparel industry in these four countries is projected to forego a combined $65.8 billion in potential export earnings by 2030, nearly 22 per cent less than in the adaptation scenario.

Across the four countries, the apparel industry in the no-adaptation scenario would employ nearly 1 million fewer workers in 2030 than in the adaptation scenario.

In Bangladesh, job creation would reach 4.83 million in 2030 under the adaptation scenario, but could be lowered to 4.58 million in the non-adaptation scenario.

Beyond the heat stress, climate change is also driving more intense flooding, a persistent hazard for low-lying nations like Bangladesh.

An analysis of the 30 heaviest rainfall days in Dhaka shows that average daily precipitation intensified from 41.5 mm (2005-2009) to 42.2 mm (2020-2024).

The study also said that among this group of producer countries, workers in Bangladesh are the most climate-vulnerable, while workers in China are the least vulnerable.

The study also said that in Bangladesh, there is no specific temperature or threshold requirements, and unregulated third parties often certify compliance.

The Accord on Fire and Building Safety, agreed by unions and apparel buyers in 2013 after the deaths of more than 1,100 apparel workers in the Rana Plaza fire, required that manufacturers ensure the health and safety of workers. Still, indoor heat was also excluded from its remit, the study said.

The report also stated that water-related risks could directly disrupt business if worst-case riverine flooding events (once-in-a-century) occur in Bangladesh, potentially impacting approximately 27 per cent of manufacturing facilities, with water inundation levels of 0.5 meters or more.

The report said that apparel manufacturers in high-heat climates have already begun investing in ways to cool working areas, often as part of relocating to purpose-built facilities.

According to Better Work, it observed an increase in the number of apparel manufacturers in Bangladesh, Cambodia, Egypt, Nicaragua, and Viet Nam implementing cooling initiatives.

The study recommended that governments, regulators, and brands to set and enforce mandatory standards, include earlier start times and different work schedules, longer rest breaks, better access to potable drinking water, and training in symptoms of heat-related illnesses and appropriate first aid.

Governments could also require manufacturers to collect and disclose heat and humidity levels.

Manufacturers, investors, brands, and retailers could invest in effective passive and active cooling systems, as well as financing options, the study added.

Manufacturers could consult with workers and their representatives about the best ways to organise production and lower adverse impacts on workers’ health and incomes, including particular attention to pregnant women and breastfeeding mothers.​

 

[Saif]

A difficult year on the apparel factory floor

Throughout 2025, local garment makers had to spend much of their time recalculating decisions rather than executing long-term plans in their production lines.

www.thedailystar.net

A difficult year on the apparel factory floor
Despite headline growth, 2025 tested garment exporters across markets and margins

Throughout 2025, local garment makers had to spend much of their time recalculating decisions rather than executing long-term plans in their production lines.

The main uncertainty was how much duty their shipments would face in the US, the largest single-country market for Bangladesh. From April, tariff rates shifted punishingly upwards before settling in August at levels higher than before. By the time some stability returned, much of the damage to margins and order planning had already been done.

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External volatility coincided with mounting pressures at home.

High bank interest rates squeezed working capital, while inconsistent gas and power supplies disrupted operations. Trade tensions with India continued throughout the year, complicating logistics and sourcing.

In October, a fire at Dhaka airport destroyed garment samples, imported accessories and raw materials worth millions of dollars. Lately, tighter labour rules have added to the manufacturers' concerns.

Looming over all of it was the approach of graduation from the least developed country club in 2026, which would strip away preferential market treatments for "Made in Bangladesh" items.

Exporters say 2025 failed to deliver the stability or margins they had hoped for, despite pockets of shipment growth. Expectations of improvement have largely been deferred to 2026, resting more on political timing and buyer behaviour than on any clear easing of structural pressures.

On April 2 this year, the US announced reciprocal tariffs on several countries, including Bangladesh, setting the rate at 37 percent on apparel, on top of the existing 16.5 percent rate. The move lifted the effective tariff to 53.5 percent, raising costs for exporters and buyers at a time when global demand was already fragile.

After negotiations, the tariff was reduced to 20 percent from August 7, bringing the effective rate down to 36.5 percent.

As part of the agreement, Dhaka committed to importing more American goods to narrow the annual bilateral trade deficit of about $6 billion, tilted towards Bangladesh.

The relief came somewhat late to restore momentum.

Many exporters had already rushed shipments between April and August to avoid higher duties. That front-loading left international retailers with high inventories, which in turn slowed new order placement later in the year, even after US tariffs eased.

In the January-August period, US apparel imports grew 3.32 percent year-on-year to $53.01 billion.

Exports from the country to the US increased 19.82 percent to $5.64 billion over the same period, according to the Office of Textiles and Apparel.

Data from the Export Promotion Bureau (EPB), compiled by the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), show exports to the US at $2.59 billion during the July-October period, up 5.14 percent year-on-year and accounting for nearly one-fifth of total garment shipments.

Overall export earnings tell a flatter story. Total exports rose just 0.62 percent year-on-year to $20.02 billion during the July-November period.

Garment exports increased 1.67 percent to $35.28 billion in the January-November period, far below the double-digit growth rates the sector once considered routine.

"For business, 2025 has not been a good year as companies are facing many domestic and external challenges," said Md Fazlul Hoque, managing director of Plummy Fashions Ltd.

"The situation could improve next year, as an election is scheduled and buyers are expected to place larger volumes of work orders," he added.

Abdul Hai Sarker, chairman and chief executive of Purbani Group, expressed similar views.

Inamul Haq Khan, senior vice-president of BGMEA, also pointed to electoral timing. "Usually, international retailers and brands hold back some work orders before the general election and place full orders after it," he said.

"This year, Christmas sales in the US were disappointing, as clothing prices rose due to higher tariffs," said Khan.

In 2025, export trends to the European bloc were also mixed.

Garment exports to the European Union rose 13.7 percent year-on-year to €15.26 billion in the January-September period, according to Eurostat, as more recent data is unavailable.

During the July-November period, exports to the EU accounted for nearly half of total garment shipments, although earnings from the bloc edged down slightly compared with the same period a year earlier, according to Mohiuddin Rubel, former BGMEA director and managing director of Bangladesh Apparel Exchange Ltd.

He said that Canada and the United Kingdom recorded steady, if unspectacular, export growth.

Non-traditional markets such as Japan, South Korea and India contributed $5.23 billion in the January-October period, or about 16 percent of total exports.

Momentum there faded later in the year, with shipments to these destinations declining during the July-November period, underlining the limits of diversification at a time when exporters had hoped newer markets would soften shocks elsewhere, according to former BGMEA director Rubel.

"The slowdown in garment exports to new markets was a surprising shock for Bangladesh, as shipments to these markets had remained high for many years," said BGMEA Senior Vice-President Inamul Haq Khan.

He added that market peers, including India, China, Vietnam and Pakistan, were sending large volumes to these destinations while also facing higher US tariffs.

Bangladesh did not receive the expected volume of shifting orders from China, as Vietnam, Indonesia and Myanmar got a larger share.

Khan said Brazil is emerging as a promising market, although competition from Indonesia is intensifying.

Performance also diverged by product segment. Knitwear exports slipped slightly during the early months of the current fiscal year, while woven garments recorded slight growth. The split points to uneven demand and cost pressures rather than a broad-based recovery.

Meanwhile, gas shortages hurt spinning mills, a problem worsened by cheaper yarn imports from India. The suspension of transshipment facilities through India in April disrupted logistics, while retaliatory trade restrictions at land ports further slowed cross-border movement.

Several large factories that closed after the political changeover in 2024 have attempted to reopen but remain entangled in bureaucratic processes.

As the year draws to a close, the garment sector somewhat stands on uncertain ground. The hope of stronger performance in 2026 depends on calmer politics, steadier trade relations and renewed buyer confidence.​

 

[Saif]

https://thefinancialexpress.com.bd/views/opinions/vietnams-apparel-export-strategy-lesson-for-bd

Vietnam's apparel export strategy lesson for BD

Atiqul Kabir Tuhin
Published :
Dec 24, 2025 22:38
Updated :
Dec 24, 2025 22:38

Bangladesh and Vietnam are often presented as close rivals in the global apparel industry, with export figures suggesting a neck-and-neck race for a larger share of global apparel market. In 2024, Bangladesh exported garments worth USD 38.48 billion, accounting for 6.9 per cent of the global market, closely followed by Vietnam's USD 33.94 billion with a 6.1 per cent share. Meanwhile, China remains dominant, commanding 29.6 per cent of global apparel exports, while India and Turkey trail with less than 3-4 per cent each.

On the surface, Bangladesh is slightly ahead of Vietnam. However, focusing only on headline numbers obscures a deeper reality: the two countries are competing under different trade frameworks. Vietnam is exporting from a position of strategic security, while Bangladesh remains heavily dependent on time-bound trade privileges that are nearing expiry date.

This contrast is most visible when export destinations are examined. Vietnam has built a dominant position in the United States, exporting USD 14.98 billion worth of apparel there in 2024, almost twice Bangladesh's USD 7.34 billion. Bangladesh, in contrast, relies overwhelmingly on the European Union, where it exported USD 19.77 billion, compared to Vietnam's USD 4.31 billion. This dependence has served Bangladesh well so far, largely because of duty-free access under the EU's Everything But Arms (EBA) scheme for least developed countries. But that advantage is temporary. Vietnam's access, by contrast, is contractual and permanent, secured through the EU-Vietnam Free Trade Agreement (EVFTA).

The EVFTA is steadily reshaping competitive dynamics inside the EU market. Tariffs on many Vietnamese apparel products have already been eliminated, while others are on a clear path to full liberalisation by 2027. As a result, trade patterns are beginning to shift. In product categories where tariffs were removed immediately or within four years, EU imports from Vietnam have grown faster than those from Bangladesh. More importantly, the most commercially significant apparel items such as cotton T-shirts, denim trousers, and knitt garments fall under tariff slabs that will soon be fully liberalised for Vietnam. Early signs suggest that Bangladesh's growth in these categories is slowing, while Vietnam is accelerating.

Beyond tariffs, the two countries differ sharply in product composition. Vietnam's apparel exports to the EU are overwhelmingly non-cotton based, accounting for more than three-quarters of its shipments. Bangladesh, by contrast, remains heavily concentrated in cotton garments, with non-cotton items making up less than one-third of exports. Although Bangladesh has made progress in recent years, Vietnam's head start is reinforced by deeper investments in synthetic textiles, stronger backward linkages and greater use of renewable energy, factors that are being increasingly valued in the EU market.

This structural gap becomes more problematic when rules of origin are considered. Future EU trade preferences, particularly under GSP Plus, require compliance with double transformation rules of origin. Bangladesh's dependence on imported woven and manmade fibre fabrics puts it at a disadvantage, while Vietnam's domestic textile base allows it to meet these requirements more easily. So, without accelerating investment in fabric manufacturing, Bangladesh risks losing competitiveness even if some preferential access is retained.

Vietnam's faster growth and higher-value product mix also pose a real challenge. In the EU, 100 kg of T-shirts from Vietnam earned $2,158, nearly double the $1,092 fetched by Bangladeshi equivalents. This reflects Vietnam's strength in value-added, synthetic and technical garments, in contrast to Bangladesh's dominance in cotton basics. Approximately 73 per cent of Bangladesh's export value comes from cotton garments, even though the global apparel market is increasingly shifting towards synthetics and multifunctional apparel. Bangladesh's advantage lies in scale, cost-efficiency and production reliability.

Policy risks are also looming large. The EU is set to review its Generalised Scheme of Preferences, with changes expected to take effect in 2028. Bangladesh has already exceeded safeguard thresholds that allow the EU to suspend preferences when import concentration becomes excessive. Its share of EU apparel imports under GSP far surpasses the established limits, creating a significant obstacle to securing GSP Plus status. When EBA benefits finally expire in November 2029, Bangladesh could face standard tariffs of around 12 per cent, while Vietnam will continue exporting duty-free under the EVFTA.

This looming asymmetry underscores a critical point: Vietnam is not merely competing on price or productivity; it is competing on certainty. Its extensive network of free trade agreements including the CPTPP, RCEP, ASEAN FTAs and agreements with Eurasian markets has sealed in access across major regions. Bangladesh, by contrast, is still navigating graduation-related adjustments without a comparable web of long-term trade arrangements.

The next five years, therefore, represent a decisive window. For policymakers, securing sustained access to the EU must be treated as an economic priority, whether through GSP Plus eligibility, a bilateral trade agreement, or an extended transition arrangement. At the same time, trade diplomacy must be matched by domestic reform, particularly in building backward linkages in woven and manmade fibre textiles, improving energy efficiency and aligning with emerging sustainability and traceability standards.

For entrepreneurs and manufacturers, the challenge is equally urgent. The future will reward those who diversify products, invest in technology and integrate more deeply into global value chains. Bangladesh's apparel sector has demonstrated resilience time and again, but resilience alone will not offset structural disadvantages in market access. Bangladesh must deepen its global integration, adopt high-value production, and differentiate itself through innovation and sustainability. The focus must shift from just scale to sophistication.

Vietnam's trade strategy offers a clear lesson: long-term competitiveness in today's global trading system is shaped as much by policy foresight as by factory efficiency. If Bangladesh can combine its proven manufacturing strength with proactive trade strategy and industrial upgrading, it can move from vulnerability to stability, and secure a strong foothold in global apparel trade.​

 

[Saif]

RMG sector’s resilience tested as 2025 nears end

Bangladesh’s readymade garment sector faced one of its most challenging period in 2025, as manufacturers struggled to cope with tariff shocks and volatility in key export markets.

www.newagebd.net

RMG sector’s resilience tested as 2025 nears end
Saddam Hossain 27 December, 2025, 01:27

A file photo shows workers sewing clothes at a readymade garment factory on the outskirts of Dhaka. | New Age photo

Bangladesh’s readymade garment sector faced one of its most challenging period in 2025, as manufacturers struggled to cope with tariff shocks and volatility in key export markets.

Rising production costs at home, a shaken law-and-order situation and persistent disruptions to energy and logistics forced many manufacturers to prioritise short-term survival over long-term planning.

Shovon Islam, managing director of Sparrow Group, told New Age that 2025 had been challenging for the sector.

‘In many ways, the situation is comparable to the shocks we faced during the abolition of the quota system, the Rana Plaza tragedy and the Covid-19 pandemic,’ he added.

Industry insiders said that the primary source of uncertainty was the US market, Bangladesh’s single-largest apparel export destination.

In April, the United States imposed sharply higher reciprocal tariffs on several countries, including Bangladesh, on which it raised the duty on apparel shipments to the US to 37 per cent. The tariff was later lowered to 35 per cent and then to 20 per cent, following a series of negotiations on July 30.

From August 7, Bangladeshi apparel items have been facing a 20 per cent reciprocal tariff, in addition to the regular 16.5 per cent tariff.

‘During the imposition of the tariff, we were completely in the dark,’ said Shovon Islam, adding that buyers were also operating in a ‘go-slow’ mode.

Although the tariff was eventually reduced, a slowdown on the global market deepened following the US tariff measures, which reshaped global trade by raising costs, industry insiders said.

Exports of RMG items throughout the year fluctuated. While exports maintained positive growth until June 2025, they nosedived consecutively from July.

According to Export Promotion Bureau data, Bangladesh exported RMG items worth $35.49 billion to global destinations during January-November period of 2025, which was 2.53 per cent higher than the $34.71 billion recorded during the same period in 2024.

Although exports posted marginal growth overall, the negative trend that began in July persisted through November, signalling that year-on-year growth could turn negative once data for December becomes available.

Moreover, during the July-November period of FY26, Bangladeshi exporters recorded a 1.03 per cent decline in exports to the European Union to $7.83 billion, while growth to the US market remained thin at 3.06 per cent to $3.22 billion.

Surprisingly, exports to non-traditional markets also declined by 3.19 per cent to $2.67 billion during the July-November period.

Regarding the export decline, Inamul Haq Khan, senior vice-president of the Bangladesh Garment Manufacturers and Exporters Association, said that they had expected a comeback in the second half of 2025.

‘However, instead of a recovery, exports nosedived across all three major destinations — the US, the EU and the non-traditional markets,’ he added.

The slowdown on non-traditional markets is shocking, he said, noting that shipments to these destinations had remained strong for many years.

‘Throughout 2025, the global fashion industry experienced a slowdown that affected us. Most probably, consumers changed their buying patterns due to inflation and economic sluggishness,’ he added.

He said that, due to the US tariffs, China, India and other competitors aggressively entered the EU and new markets, squeezing Bangladesh’s market share.

Moreover, Bangladesh did not receive the expected volume of orders shifting from China, as Vietnam, Indonesia and Myanmar captured a larger share, he added.

Fluctuating inflation in key markets — especially the US, Europe and the United Kingdom — reduced consumers’ appetite for new apparel, forcing retailers to shift from placing large orders to smaller, more cautious purchases.

Several domestic headwinds also affected the RMG sector in 2025, including political instability, labour unrest, banking sector weaknesses, a complete shutdown of the customs house due to officials’ protests, a fire at the airport cargo village and a persistent gas and energy crisis.

Shovon Islam said that throughout 2025, the banking sector experienced severe liquidity shortages, foreign currency constraints, high interest rates and elevated levels of classified loans.

Many RMG exporters faced difficulties opening back-to-back letters of credit due to weakened bank health. Several Shariah-based banks were merged under government supervision because of their volatile condition.

Many RMG factories, including those of BEXIMCO and NASSA, as well as some small and medium-sized ones, were also forced to shut down due to non-performing loans, a lack of orders and unavoidable political situations.

Moreover, confidence among depositors and manufacturers declined as NPLs reached about 36 per cent of total loans.

Throughout the year, operations in Bangladesh’s industrial sectors — particularly the textile sector — were severely affected by frequent interruptions in gas supply, with factories receiving only 2-5 PSI, well below the required 15 PSI.

Due to the persistent gas shortage, production at textile mills fell by nearly 30-35 per cent, industry insiders said.

Mohiuddin Rubel, former BGMEA director, said that intensified labour unrest, including road blockades and factory closures, also disrupted production and deliveries.

‘Moreover, the country experienced a complete shutdown of the customs house for the first time — an event rare globally — which severely impacted exports,’ he added, noting that a significant fire at the cargo village of Hazrat Shahjalal International Airport destroyed garment shipments worth about $1 billion, directly cutting export earnings.

At the same time, he added, the removal of export incentives and the reduction of the Bangladesh Bank’s Export Development Fund to $2 billion also hurt the sector.

On November 17, 2025, the interim government amended the Bangladesh Labour Act to simplify trade union formation, introduce enhanced maternity benefits, mandate provident fund contributions and reduce the minimum wage review cycle from five to three years.

Bangladesh also ratified ILO Conventions C190, C155 and C187, becoming the first South Asian nation to ratify all 10 fundamental conventions.

While worker rights groups widely praised these reforms, industry stakeholders expressed concerns about rising compliance costs and administrative burdens.

Among the mentioned issues, a silent trade war with India was also on, as India imposed a ban on imports of several jute products and ropes through land ports on August 11, following similar import bans on several jute and woven products through land ports on June 27, leaving Kolkata and Mumbai ports open.

Earlier on May 17, India imposed restrictions on the import of most Bangladeshi products, including RMG, processed foods and agro-products.

On April 9, India withdrew the trans-shipment facility it had granted to Bangladesh for exporting various items to the Middle East, Europe and other countries, except Nepal and Bhutan, following Bangladesh’s March 28 ban on importing yarn from India through land ports.

Mustafizur Rahman, distinguished fellow of the Centre for Policy Dialogue, said that Bangladesh had failed to resolve key issues that continued to erode its competitiveness.

Despite these headwinds, Bangladesh achieved some positive milestones in 2025.

During January-September period 2025, Bangladesh’s exports to the US reached $6.42 billion, marking 18.64 per cent growth, according to OTEXA data, while exports to Europe also rose by 9.45 per cent to 16.67 billion euros.

The country maintained its growth trajectory despite intense competition from rival exporters.

According to World Trade Organisation data, Bangladesh remained the world’s second-largest RMG exporter in 2024, with a global market share of 6.9 per cent.

Throughout 2025, Bangladesh also retained its leadership in green transformation, with 38 RMG factories receiving certification from the US Green Building Council for Leadership in Energy and Environmental Design in 2025, bringing the total number of LEED-certified garment factories to 270.

‘As the industry moves forward, the challenge will be to build on this foundation by integrating green factories with low-carbon operations, circular production models and digital sustainability reporting,’ said Mohiuddin Rubel.

The progress achieved in 2025 showed that Bangladesh is not only ready for this transition but is already leading it, he added.

Regarding recommendations for 2026, Mustafizur Rahman said that Bangladesh must address issues related to product and market diversification, reduce the cost of doing business, ease port congestion and develop a comprehensive logistics solution.

‘Bangladesh should focus on attracting more foreign direct investment and implementing a national logistics policy,’ he added, noting that all measures must be taken with the country’s LDC graduation scheduled for November 2026 in mind.

Inamul Haq Khan said that industry players remained cautious about a recovery in 2026 as the global economy continued to face turmoil.

‘However, an elected government could boost buyers’ confidence, as they closely monitor the February election,’ he added.

Echoing similar sentiments, Shovon Islam said that elections and the formation of a political government could help restore confidence.

‘Buyers are focusing on the February elections and they are highly concerned. If a fair election takes place on time, it could significantly boost buyers’ confidence,’ he added.

However, buyers have also expressed disappointment over attacks on media houses and cultural centres, which have tarnished the country’s image, he said.

He added that if political stability and law and order were restored, exports could begin to recover after April.

Mohiuddin Rubel said that Bangladesh must identify and address the root causes of factory closures and strengthen the financial sector’s capacity to provide stable and appropriate support to the industry in 2026.

‘It must also establish effective monitoring systems to ensure that new factories entering the sector align with and contribute to broader industrial development goals,’ he added.

Bangladesh’s competitiveness, he said, will depend on how quickly it can close infrastructure gaps, ease internal bottlenecks and move up the value chain — calling for stronger logistics, political and social stability, better factory-level efficiency and greater investment in research and development, innovation and marketing.​