Strength & Weakness
Of
Textile Sector
in
Bangladesh
SOUTHEAST UNIVERSITY
Dept. Of Textile Engineering
Submitted to
Ahmad Ullah
- Co-Ordinator
Prepared By
Prepared by : Mazadul Hasan sheshir
Introduction
•
The tremendous success of readymade garment exports from Bangladesh over the
last two decades has surpassed the most optimistic expectations. Today the
apparel export sector is a multi-billion-dollar manufacturing and export industry
in the country. The overall impact of the readymade garment exports is certainly
one of the most significant social and economic developments in contemporary
Bangladesh. With over one and a half million women workers employed in semi-
skilled and skilled jobs producing clothing for exports, the development of the
apparel export industry has had far-reaching implications for the society and
economy of Bangladesh.
History

From 1947 to 1971 the textile industry, like most industries in East Pakistan, were largely owned by West Pakistanis. During that period, in the
1960s, local Bengali entrepreneurs had set up their own large textile and jute factories. Following its separation from East Pakistan the newly
formed Bangladesh lost access to both capital and technical expertise.

Until the liberation of Bangladesh in 1971, the textile sector was primarily part of the process of import substitution industrialization (ISI) to
replace imports. After the liberation, Bangladesh adopted export-oriented industrialization (EOI) by focusing on the textile and clothing

While most low-income countries depend largely on the export of primary commodities, Bangladesh has made the transition from being
primarily a jute-exporting country to a garment-exporting one. This transition has been dictated by the country’s resource endowment,
characterized by extreme land scarcity and a very high population density, making economic growth dependent on the export of labor-
intensive manufactures.
Market Diversi"cation
•
Bangladeshi RMG products are mainly destined to the US and EU. Back in 1996-97,
Bangladesh was the 7th and 5th largest apparel exporter to the USA and European
Union respectively. The industry was successful in exploring the opportunities in
markets away from EU and US. In FY07, a successful turnaround was observed in
exports to third countries, which having a negative growth in FY06 rose three-fold in
FY07, which helped to record 23.1 percent overall export growth in the RMG sector. It
is anticipated that the trend of market diversification will continue and this will help to
maintain the growth momentum of export earnings. At the same time a recent WTO
review points out that Bangladesh has not been able to exploit fully the duty free access
to EU that it enjoys. While this is pointed out to be due to stringent rules of origin
(ROO) criteria, the relative stagnation in exports to EU requires further analysis.
Product Diversi"cation
•
The growth pattern of RMG exports can be categorized into two distinct phases.
During the initial phase it was the woven category, which contributed the most.
Second phase is the emergence of knitwear products that powered the recent
double digit (year-on-year) growth starting in FY04. In the globalized economy
and ever-changing fashion world, product diversification is the key to continuous
business success. Starting with a few items, the entrepreneurs of the RMG sector
have also been able to diversify the product base ranging from ordinary shirts, T-
shirts, trousers, shorts, pajamas, ladies and children’s wear to sophisticated high
value items like quality suits, branded jeans, jackets, sweaters, embroidered wear
etc. It is clear that value addition accrues mostly in the designer items, and the
sooner local entrepreneurs can catch on to this trend the brighter be the RMG

Bangladesh to take advantage of the low labor cost. Even now for the readymade
garments most of the manufacture need to bring all the accessories from abroad,
which is very costly. Now they are start using locally accessories minting the
required quality. Zippers, buttons, labels, hooks, hangers, elastic bands, thread,
backboards, butterfly pins, clips, collar stays, collarbones and cartons are the
major garment accessories produced in Bangladesh.
Conclusion
•
The Ready-Made Garments (RMG) industry occupies a unique position in the
Bangladesh economy. It is the largest exporting industry in Bangladesh, which
experienced phenomenal growth during the last 25 years. By taking advantage of
an insulated market under the provision of Multi Fibre Agreement (MFA) of
GATT, it attained a high profile in terms of foreign exchange earnings, exports,
industrialization and contribution to GDP within a short span of time. The
industry plays a key role in employment generation and in the provision of
income to the poor. To remain competitive in the post-MFA phase, Bangladesh
needs to remove all the structural impediments in the transportation facilities,
telecommunication network, and power supply, management of seaport, utility
services and in the law and order situation. The government and the RMG sector
would have to jointly work together to maintain competitiveness in the global
RMG market. Given the remarkable entrepreneurial initiatives and the dedication
of its workforce, Bangladesh can look forward to advancing its share of the global
RMG market.