Industrialization is a major reason for the economic development of a country. It plays a significant role in transforming the monetary structure of developing nations. Textile industry of Bangladesh is more than 500 years old. It is one of the oldest and most successful industries with its rich history. Moreover, in recent years there has been a substantial development in yarn and fabric production.
There is a significant effect of globalization on international textile and apparel trade. Today, the developed countries are hugely dependent on the developing nations for textile and garment manufacturing. At present, Bangladesh ranks second in the world as the largest apparel producers with a $20 billion business in which 80% is earned by exporting goods.
There are three fundamental factors which have boosted the growth of textile in Bangladesh. The country has plenty of resources, opportunities, and beneficial government policies. In Bangladesh large number of labor workers can be found. Also, natural gas and cost of energy is cheap. With huge population, labor is abundant, and Bangladesh has an advantage in producing labor intensive products.
The main reason for the development of the textile industry in Bangladesh is the hardworking labor force. They put in more working hours to complete the target. Therefore, in recent times the per capita income of the country and the standards of living of the people have improved. Secondly, the country acquired an advantageous opportunity to trade with America and the European countries in readymade garments segment.
These opportunities were supported by the government policies which sustained the growth of textile in Bangladesh. The liberal government policies promoted investments from foreign countries. The garment industry of Bangladesh is renowned and holds a major place in the world market today. The textile industry of the country has specialized textile goods, knitwear, and woven apparels. These products top in grabbing the export income for the country.
Moreover, the quota-free textile rule which has been introduced since 2005 has substantially improved the textile industry of Bangladesh. The government policies that supported textile included monetary advantages and institutional help. As mentioned earlier, labor and power are cheap and easily available here compared to India, Pakistan or China. This gives them a competitive advantage against their competitors.
The new textile policies which have been introduced almost have no tariffs for the spinning sector. However, the imported yarns and materials have high tax rates so as to encourage the use of local fabrics and yarn production. All these factors worked together in favor of the textile development in Bangladesh. Nevertheless, in the past ten years the country has witnessed the growth of spinning industry.
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The spinning capacity has increased four times in ten years which is a commendable job. In current scenario, the textile industry employs almost 4 million people in Bangladesh. 45% of the industrial employment is the result of textile industry. According to the latest reports, Bangladesh exports apparels worth $5 billion annually to the US, European countries, Canada and other nations.
Majority of its exports include polyester fabrics, fabrics made from man-made fibers, PV fabrics, viscose thread fabrics etc. Apparel exports mainly consist of knitted or woven shirts, tops, trousers, skirts, shorts, sweaters and sportswear garments. The handloom industry provides employment for large number of people and also produces fabrics required by the domestic market. In spite of being one of the growing and largest industries of Bangladesh, it faces some challenges.
It is a known fact the Bangladesh has a great future in textile and garment industries. In fact a major chunk of national income is earned from the foreign currency received from textile and readymade garment exports. The textile and garment sector contributes to 81.43% of the total exports of Bangladesh. In this situation, it is easy to understand what will happen if there is any exhaustion or problem in this sector.
Availability of abundant natural gas, cheap labor and energy has been the core reason due to which the textile industry has sustained in Bangladesh over the years. However, in the recent years all the abundant resources which have been the backbone of the textile industry have turned hostile. The basic raw materials needed in the spinning sector are raw cotton and synthetic fibres. Sadly, none of these are produced in Bangladesh.
The energy which was available in abundance has become insufficient. Water which was in ample quantity has become scarce as it is being used quickly and made dirty. Also the huge population which was available for the labor intensive industries have not being employed and looked upon properly. Hence, the core strengths of the textile industry are becoming a major setback for the industry. However, the government is looking forward to find solution to these problems.
In this situation, Bangladesh cannot afford to waste these valuable resources or it cannot compete in the international textile and garment market. The main agenda of the 2nd International conference on textile & apparel is proper and efficient use of the resources. In this conference, the actual scenario of the textile industry will be discussed. The main priority is to come up with apt solutions to tackle the sensitive issues, and implement strategies that will enhance the growth of textile industry in Bangladesh.
The recent collapse of the factory building near Dhaka; has questioned the safety standards in the factories of Bangladesh at a global platform. As per the reports more than 300 factories have been shut down in Ashulia after this fatal incident. Nearly 80% of the factory workers have demanded increase in the salary and safety measures to be followed.
In response to this deadly accident, Bangladesh has requested European Union not to take strict steps against them in this critical situation. If the EU or other buyers enforce any tough measures on trade with Bangladesh it will badly affect the economy of the country. Also, millions of workers will lose their jobs.
In conclusion, one can say that if Bangladesh is able to maintain its current growth in textile and readymade garment industry, it can reach the target of $40 US dollar export by 2020. To achieve this position, it needs significant development in this sector and reasonable access to the US and the EU market.