- Apparel Exports Grow 12% in First Seven Months of Fiscal Year 2024-25
Bangladesh’s garment exports increased by 12% year on year to $23.55 billion in the first seven months (July-January) of fiscal year 2024-25, according to Export Promotion Bureau (EPB) figures. In January alone, garment shipments were $3.66 billion, representing a 5.7% rise year over year. However, after seeing double-digit increase between September and December, the expansion decreased in January.
Performance of Knitwear and Woven Garments
The knitwear industry experienced 6.62% growth, while woven garment exports climbed by 4.52% in January. Exporters credit this development to changing global trade trends, with Bangladesh attracting more orders as customers migrate away from China. However, industry executives caution that growth estimates do not properly account for the financial challenges generated by increased manufacturing costs and fierce price rivalry.
Challenges Facing the Apparel Sector
Several factors influence the long-term viability of the garment sector, according to industry analysts. Profit margins are under pressure as raw material, utility, and payroll prices rise, while global economic uncertainty continue to have an impact on demand. According to Mohiuddin Rubel, previous director of the BGMEA, additional analysis is needed to examine market-specific trends, product concentration, and other relevant factors. He noted that global trade has faced significant disruptions, making it crucial for exporters to adjust their strategies to remain competitive.
Geopolitical Impact on Apparel Trade
Geopolitical changes are shaping the future of Bangladesh’s garment exports. Garment business leaders stated that Donald Trump’s return to the White House could create new new trade opportunities for Bangladesh. The US has already placed a 10% tariff on Chinese imports, bringing effective tariff rates to as high as 35 percent. Furthermore, the application of a 25% levy on Mexican goods, which has recently emerged as a major apparel exporter, may increase demand for Bangladeshi garments in the US market. As trade tensions escalate, Bangladesh will benefit from altering global sourcing tactics, but exporters must be ready to meet changing buyer expectations.
Future Outlook for Apparel Exports
Bangladesh has set a $50 billion export target for FY25, with the apparel industry playing the most important role in meeting this ambitious aim. While growth has been consistent thus far, maintaining momentum will necessitate strong policy support, dependable energy supply, and continuing investment in infrastructure development. preserving buyer confidence through a stable legal and regulatory environment will also be critical in preserving export growth.
As global trade patterns continue to alter, Bangladesh’s apparel industry must stay adaptive, competitive, and well-prepared to overcome rising obstacles while capitalizing on new opportunities in the international market.
Source: The Daily Star
- Bangladesh-Japan EPA: A Game Changer for the Apparel Industry?
Bangladesh is about to become the first country to sign a free-trade agreement (Economic Partnership agreement, or EPA) with Japan. Given that Bangladesh’s textile and garment industry is its largest export sector, this agreement creates new potential.
The EPA is especially important as Bangladesh prepares for LDC graduation in November 2026. Bangladesh is projected to lose the existing zero-duty benefit in the Japanese market when it exits the Least Developed Country (LDC) category, potentially resulting in tariffs of up to 18% on exports. Currently, around 73% of Bangladesh’s exports to Japan are duty-free under LDC concessions. This agreement seeks to maintain preferential access and a competitive position in Japan’s market.
Japan is currently Bangladesh’s 12th major export market and 7th largest import source, with bilateral commerce valued at $1.90 billion in exports and $2.02 billion in imports last fiscal year. The EPA is expected to foster a fairer trade environment, benefiting both Japanese investors in Bangladesh and local manufacturers seeking a stable export channel.
The EPA is expected to create a fairer trading climate, helping both Japanese investors in Bangladesh and local businesses looking for a reliable export channel.
Japanese enterprises have played an important role in the development of Bangladesh’s textile sector over the years, bringing investments that have improved production efficiency and compliance. Japanese commercial and construction businesses have increasingly extended their presence in Bangladesh, particularly in textiles and logistics, thanks to the country’s inexpensive labor prices.
According to the Joint Study Group on the Japan-Bangladesh Economic Partnership Agreement, improved trade relations will boost competition, raise manufacturing standards, and provide long-term economic advantages to both nations.
Despite the potential benefits, the Japanese market has strict quality and compliance standards, which may offer considerable challenges for Bangladeshi textile makers. Competing with established suppliers from Vietnam and China, which have solid trade agreements and logistical advantages, will be a significant challenge for Bangladeshi exporters.
Logistics expenses continue to be an issue. Exporting to Japan incurs higher transportation and shipping costs than nearby markets such as the EU or the United States, which may impair profitability. The World Bank’s study on Bangladesh’s financial sector performance emphasizes that upgrading transportation infrastructure is critical for future economic development and trade expansion.
Collaboration with Japan on knowledge transfer and industrial modernization could assist Bangladesh’s textile sector enhance production efficiency and product quality, increasing its competitiveness in the global market. Bangladesh’s expansion into high-value textiles, such as sustainable fashion and technical textiles, can position it to enter Japan’s premium market segment, which is increasingly focused on eco-friendly and high-performance fabrics.
Introducing specialized training programs will be required to upskill textile workers and achieve Japan’s stringent quality standards. Establishing exclusive economic zones (EEZs) for Japanese businesses, together with trade-friendly laws, has the potential to attract additional foreign direct investment (FDI) and deepen economic linkages.
As global trade dynamics shift, emphasizing long-term strategies in automation, compliance, and innovation will be critical to capitalizing on the Japan-Bangladesh Economic Partnership Agreement and safeguarding Bangladesh’s garment industry’s long-term success.
Source: Textile Today
- Bangladesh Reaches 237 LEED-Certified Factories
The United States Green Building Council (USGBC) has certified two more ready-made garment (RMG) factories in Bangladesh with Leadership in Energy and Environmental Design (LEED), cementing the country’s status as a global leader in sustainable textile production. According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh now has 237 LEED-certified factories, including 95 platinum-rated, 128 gold-rated, ten silver-rated, and four certified factories.
Columbia Apparels Ltd, situated in Gazipur has received a gold certification under the LEED O+M: Existing Building v4.1 rating system in February, scoring 77 points. Banga Fashion Ltd, another manufacturer in Gazipur, obtained a platinum certification from the USGBC after scoring 87 points under the same system.
According to industry insiders, 550 additional firms are currently awaiting LEED certification from the USGBC, demonstrating Bangladesh’s rapid adoption of environmentally friendly manufacturing processes.
Source: The Business Standard
- Bangladesh’s RMG Sector Rebounds as Buyers Return After Labor Unrest
Challenges and Order Shifts
The recent labor dispute in Bangladesh’s ready-made garments (RMG) sector created substantial interruptions, resulting in temporary order losses for regional competitors. However, with stability restored and overseas purchasers restoring trust, the industry is currently seeing a strong recovery.
Production losses in key industrial zones including Savar, Ashulia, and Gazipur totaled almost $400 million. According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), approximately $2 billion in garment orders were diverted to competing countries, including India, Pakistan, Sri Lanka, and Vietnam. These transfers accounted for 5%-6% of Bangladesh’s total exports, highlighting the seriousness of the crisis.
India’s Temporary Gains and Bangladesh’s Competitive Edge
Although India gained initially from the order transfer, maintaining long-term profits proved challenging due to higher production costs, fragmented supply networks, and longer lead time. India’s textile hubs, like Tirupur and Ludhiana, had an initial order spike of about $1.5 billion, but structural inefficiencies and labor costs—roughly 30% higher than in Bangladesh—harmed its competitiveness. Bangladesh, on the other hand, maintained its reputation as a preferred sourcing destination once stability restored, thanks to its concentrated RMG clusters, low-cost production, and skilled workforce.
Recovery and Renewed Optimism
Normalcy has been restored in major industrial hubs thanks to concerted efforts by the government, police enforcement, labor leaders, and the BGMEA, and international fashion retailers are once again placing orders. Many manufacturers are now functioning at full or even higher capacity, thanks to economic recovery in key markets such as the United States, Germany, and the United Kingdom.
Exports to the United States increased by 11.73% in the July-September period of FY25, totaling $2.05 billion, with clothes accounting for $1.81 billion. Bangladesh’s garment exports to Germany climbed by 1.96% to $1.14 billion, while UK imports increased by 1.89% to $1.12 billion, indicating comparable growth. According to forecasts, US garment imports could increase by 7% to 10% this year.
The Way Forward
Bangladesh’s capacity to recover and reclaim orders from competitors demonstrates its dominance in the global garment market. With a focus on sustainability, the country today has the world’s highest number LEED-certified green factories and is committed to ensuring a stable work environment.
Long-term prosperity depends on addressing recurring obstacles, such as simplifying customs procedures, maintaining stable utilities, and negotiating trade benefits with key partners such as the United States. Expanding duty-free access for man-made clothes might dramatically increase exports. Industry leaders have also recommended using renowned personality like Nobel Laureate Professor Yunus who is the Chief Advisor of current interim government to fight for more favorable trade policies with the United States.
Bangladesh’s competitive advantage is further strengthened by its specialized manufacturing clusters and skilled workforce. While competitors like India strive to increase exports through schemes like the Production-Linked Incentive (PLI) plan, Bangladesh’s concentration on technology, sustainability, and workforce development maintains its global competitiveness.
As global brands negotiate market uncertainties, Bangladesh must improve its position by investing in sophisticated manufacturing technologies and deepening partnerships with foreign clients. These initiatives will not only ensure continuous growth, but will also solidify the country’s position as the world’s premier garment sourcing hub. Bangladesh is well-positioned to impact the future of the global clothing sector, having set an ambitious aim of $100 billion in RMG exports by 2030.
Source: Textile Today
- Trade Between Bangladesh and India: Growth, Imbalance, and Future Risks
Bangladesh’s apparel exports to India have rebounded significantly in the first seven months of FY25, increasing by 18.70% year on year after declining in the previous fiscal year. Exporters credit this turnaround to increased worldwide demand, with many Western brands operating in India shifting their sourcing from Bangladesh.
According to Export Promotion Bureau (EPB) figures, garment shipments to India were $427.62 million between July and January of FY25, compared to $360.26 million in the same period of FY24. Knitwear generated $147.85 million, while woven clothes generated $279.16 million. Despite recent increase, apparel exports fell by 19.70% in FY24, with earnings down to $548.83 million from $683.47 million in FY23.
Exporters point out that India’s lower imports last year were driven by a greater emphasis on domestic manufacturing and higher import costs owing to currency difficulties. However, as global demand develops, prominent international brands in India are increasingly buying from Bangladesh, boosting RMG exports.
Trade Imbalance and Future Challenges
While garment exports are increasing, Bangladesh maintains a major trade imbalance with India. Over a 20-month period ending in November 2024, India’s trade surplus with Bangladesh was $9.22 billion, with exports to Bangladesh totaling $11.07 billion and imports of only $1.85 billion. Bangladesh is India’s eighth-largest export destination, and one of the few South Asian economies with a significant bilateral trade deficit.
Economists argue that Bangladesh should diversify its exports beyond RMG and lessen its dependency on Indian imports, notably in power and energy.
Concerns Over LDC Graduation and Duty Implications
Bangladesh’s forthcoming LDC graduation in November 2026 presents another significant difficulty. Bangladesh currently has duty-free access to India’s market under the South Asian Free Trade Area (SAFTA) agreement. However, following graduation, RMG exports may face up to 20% import taxes, potentially affecting garment commerce with India and other non-traditional markets such as Japan, Australia, Chile, and China.
Industry executives fear that unless Bangladesh renegotiates trade agreements and seeks an extension of preferential trade benefits, exports to India may drop after graduation. Furthermore, exporters argue that high business costs—resulting from infrastructural deficits, long customs processes, and inefficient logistics—are weakening Bangladesh’s capacity to compete in the global market.
Shifting Trade Strategies and the Rupee Trade Settlement
In response to currency shortages, Bangladesh and India launched a cross-border commercial settlement system in July 2024, which allows transactions in Indian rupees rather than US dollars. This action tries to facilitate commerce but does not address the structural disparities between the two economies.
To continue development in garment exports while also lowering trade dependency, experts recommend that Bangladesh focus on:
- Exploring new product categories beyond RMG.
- Negotiating trade agreements to ensure duty-free access following LDC graduation
- Strengthening backward-linkage sectors to increase competitiveness
- Reducing dependency on Indian imports, particularly in critical industries like energy.
As trade dynamics alter, Bangladesh must act quickly to maintain its export advantages and balance its trade relations with India to ensure long-term economic stability.
Source: The Financial Express
