[🇧🇩] Textile & RMG Industry of Bangladesh

[Saif]

Textile millers oppose scrapping 30% value-addition rule

Textile millers have urged the government not to withdraw the 30 percent value-addition requirement on imports of garment raw materials such as yarn, warning that the move could harm the domestic primary textile sector.

www.thedailystar.net

Textile millers oppose scrapping 30% value-addition rule

Star Business Report

Textile millers have urged the government not to withdraw the 30 percent value-addition requirement on imports of garment raw materials such as yarn, warning that the move could harm the domestic primary textile sector.

The withdrawal would encourage garment exporters to import yarn instead of sourcing it locally, potentially flooding the domestic market with imported products, they said.

In its proposed budget for FY2026-27, the government has proposed scrapping the 30 percent value-addition requirement in the domestic market to facilitate business operations.

If implemented, the measure could undermine the primary textile sector, which has attracted investments of around $23 billion, said Showkat Aziz Russell, president of the Bangladesh Textile Mills Association (BTMA), at a press conference held at the Gulshan Club in Dhaka yesterday.

He said the proposal runs counter to efforts to preserve the country’s competitiveness and sustain local industry ahead of Bangladesh’s graduation from the Least Developed Country (LDC) category.

Citing various studies, Russell said Bangladesh could lose $17.5 billion in exports, mainly apparel shipments, following LDC graduation. He also said that 114 of the 234 spinning mills owned by BTMA members had shut down since 2019.

The remaining mills are operating at only 60 percent to 70 percent of capacity due to inadequate gas supplies and the growing dominance of lower-cost Indian yarn in the domestic market, he added.

According to BTMA data, imports of Indian cotton yarn rose 22.07 percent year-on-year to $1.79 billion in FY2024-25, with import volumes reaching 556.12 million kilograms.

In FY2023-24, imports of Indian cotton yarn stood at $1.48 billion, with volumes of 455.57 million kilograms, registering annual growth of 1.04 percent, the association said.

Russell said Indian suppliers are able to offer yarn at lower prices because of extensive government support.

He said the Indian government also provides a 15 percent capital investment subsidy, an 8 percent interest subsidy, infrastructure support, and 15 percent assistance for technology upgradation and modernisation.

Another concern is the risk of supply disruptions, he said, noting that Indian exporters may prioritise other markets without prior notice.

Russell cited a recent instance when India increased yarn exports to China, leaving Bangladeshi importers facing shortages and higher prices as local demand surged.

In the post-LDC era, Bangladesh may need to meet double-transformation requirements to retain trade benefits, which would require greater use of locally produced yarn, he said.

Therefore, the capacity of domestic spinning mills and the broader primary textile sector should not be reduced, particularly when the country needs to strengthen preparations for LDC graduation, he added.

Russell also urged the government to reduce the corporate tax rate for primary textile mills to 12 percent from the current 27.5 percent and maintain the rate until 2030 to attract more foreign direct investment.

He argued that the existing tax rate is discriminatory, as export-oriented non-green garment factories are taxed at 12 percent, while green garment factories enjoy a 10 percent rate.

The reduced 15 percent tax rate previously enjoyed by primary textile mills expired on June 30, 2025, after being introduced in 2015.​

 

[Saif]

BGMEA proposes phased ZLD implementation for apparel sector

The apparel apex body BGMEA on Wednesday proposed a gradual and performance-based roadmap for implementing zero liquid discharge (ZLD) in the ready-made garment sector instead of the existing mandatory commitment. The ZLD is an advanced water treatment process designed to eliminate liquid waste fr

thefinancialexpress.com.bd

BGMEA proposes phased ZLD implementation for apparel sector

FE ONLINE REPORT

Published :
Jun 24, 2026 20:36
Updated :
Jun 24, 2026 20:36

The apparel apex body BGMEA on Wednesday proposed a gradual and performance-based roadmap for implementing zero liquid discharge (ZLD) in the ready-made garment sector instead of the existing mandatory commitment.

The ZLD is an advanced water treatment process designed to eliminate liquid waste from industrial operations.

The BGMEA (Bangladesh Garment Manufacturers and Exporters Association) made the proposal when a delegation led by its President Mahmud Hasan Khan met Environment, Forest and Climate Change Minister Abdul Awal Mintoo at the latter’s secretariat office in Dhaka city.

Former Bangladesh Textile Mills Association President A Matin Chowdhury, BGMEA Director Nafis-ud-Doula and Kingsley CEO Md Ashiqur Rahman, among others, were present at the meeting.

The association also demanded the formulation of specific sustainability guidelines for water conservation and reuse, financial incentives such as VAT and duty exemptions on ZLD equipment and the launch of a specialised ‘ZLD-window’ under the Green Transformation Fund of Bangladesh Bank.

The meeting also discussed the need to align environmental compliance with the realities of the ready-made garments and sustainable textile sector.

Reiterating their commitment to ensuring a sustainable environment, the sector leaders highlighted several regulatory complexities and obstacles, including technical challenges related to the 'Environmental Protection Rules, 2023'.

The delegation noted that the current ETP colour parameters are technically very difficult to achieve with the existing infrastructure and requested that a realistic and science-based standard be set.

To enhance administrative transparency, the delegation suggested introducing a mirror testing mechanism for environmental sampling and systematically adopting a risk-based, long-term environmental clearance renewal system for compliant factories.

The BGMEA also urged the government to formulate rules under the Forest Ordinance (2026) quickly to remove uncertainty over land use in industrial areas.

The meeting also highlighted the need to set tolerance limits for fluctuations in environmental parameters due to extreme weather conditions and to ensure a balanced air quality assessment, taking external sources of pollution into account.

Acknowledging the important contribution of the readymade garment sector to the national economy, the minister assured the delegation of addressing the issues while balancing the needs of the industry with the goal of environmental conservation.​

 

[Saif]

Direct US cotton sourcing delivers savings for BD mills

Bangladeshi spinning mills are increasingly turning to direct procurement of raw cotton from US farmers, bypassing traditional international trading houses in a move expected to lower costs for local manufacturers while ensuring better returns for American growers.Demographics The initiative, led

thefinancialexpress.com.bd

Direct US cotton sourcing delivers savings for BD mills

Jasim Uddin

Published :
Jul 04, 2026 08:03
Updated :
Jul 04, 2026 08:03

A denim producing factory in Bangladesh — Photo courtesy: hameemdenim.com

Bangladeshi spinning mills are increasingly turning to direct procurement of raw cotton from US farmers, bypassing traditional international trading houses in a move expected to lower costs for local manufacturers while ensuring better returns for American growers.Demographics

The initiative, led by a new US-based trade platform named AmeriBangla, has already facilitated direct cotton purchases by three Bangladeshi textile companies, while another 19 spinning mills are in talks to join the programme.

AmeriBangla Chief Executive Officer Aswar Rahman says the company has spent more than a year building a direct supply chain linking Bangladeshi mills with US cotton growers.

"We now have a strong network of around 900 farmers across Texas, Georgia, Arizona, and Oklahoma, while our broader network covers farmers in 17 US states," he tells The Financial Express.

According to him, Bangladeshi spinning mills can save several US cents per kilogramme of raw cotton by sourcing directly from farmers instead of relying on the conventional trading system.

At present, cotton imports typically pass through at least nine intermediaries before reaching Bangladeshi mills.

"Through AmeriBangla, we are creating a transparent supply chain connecting American farmers, ginners, and Bangladeshi spinning mills directly. This ensures fair pricing for both producers and buyers while eliminating unnecessary middlemen," he says.

Rahman says the US cotton trade is largely dominated by European multinational trading companies, leaving farmers with little bargaining power.

"It is a win-win model. American farmers receive better prices than they do from multinational traders, while Bangladeshi mills benefit from lower procurement costs by cutting out multiple intermediaries," he explains.

He notes that many US cotton farmers have been operating at a loss for the past five to six years under the existing marketing system.

"Those who have started doing business with us are returning to profitability with better margins," he adds.

Rahman believes the initiative could evolve into a strategic partnership between Bangladesh's apparel industry and American cotton growers.

"If Bangladesh significantly increases its use of US cotton, we will build stronger relationships with American farmers, who have real influence in Congress. Such a partnership could further strengthen Bangladesh's trade position in the United States while opening a new chapter in bilateral trade," he says.

He also highlights challenges in securing export finance in the United States.

"The US government is keen to promote exports through financing schemes. However, current regulations generally require exporters to have at least two years of experience and an annual turnover of around $6 million," he adds.

Rahman expresses hope that the US authorities would consider extending greater support to emerging exporters and trading platforms.

He also observes that export financing remains a relatively weak area in the US banking sector.

"Many banks, particularly in New York, do not even have dedicated export departments. During discussions, officials often realise only later that we are talking about exporting goods from the United States," he says.

He adds that AmeriBangla initially struggled because of the limited infrastructure available to support small and medium-sized agricultural exporters in the US, but eventually succeeded in establishing the required network.

Among the early adopters of the model is Envoy Textiles Ltd, one of Bangladesh's leading denim textile manufacturers.

Rahman says Envoy imported nearly 60 tonnes of cotton from US farmers through AmeriBangla last year.

Talking to The Financial Express, Kutubuddin Ahmed, founder and chairman of Envoy Textiles, says the company has already experienced the benefits of direct sourcing.

"We are importing cotton directly from US farmers through Ameri Bangla, and it has proved beneficial for both sides," he says.

He expresses optimism that Envoy would significantly increase its direct cotton purchases this year as the sourcing model expands.​