Cotton exports to Bangladesh hit as Western garment orders decrease

Cotton exports to Bangladesh hit: Industry insiders have reported that Western clothing and footwear companies have temporarily stopped placing new orders in the violence-torn nation of Bangladesh, even as production units there resume operations and employees put in extra hours to clear backlogs.

Cotton exports to Bangladesh hit as Western garment orders decrease

Bangladesh receives its raw materials and other inputs from the Indian textile industry, thus the drop in orders from Bangladesh has repercussions for that sector as well. According to industry insiders, India is receiving more enquiries for clothing, but its shipments of cotton to Bangladesh are starting to decrease.

“New orders are not coming in from Western companies. The workers and the administration understand that production is the lifeline, and they are working overtime to complete orders. Some items are being sourced from India to fulfil the orders, and even more, technicians are coming from India,” M. Rafeeque Ahmed, Chairman of Chennai-based Farida Group, said. The Group has investments in Bangladesh’s footwear sector.

According to Ahmed, a large portion of the output is located in Chittagong and Dhaka, which are farther away from the protest sites. While he acknowledged that there had been some hiccups in August, he added that things are again back to normal and that Western orders will soon restart because of Bangladesh’s favourable duty climate as a least developed country (LDC).

“Western companies are looking at India as an alternative, but much depends on the capacity to deliver, which at the moment has qualitative and quantitative mismatches between Indian and Bangladeshi product offerings,” said Chandrima Chatterjee, Secretary General of the Confederation of Indian Textile Industry (CITI).

Although Chatterjee stated that there are inquiries for clothing, our exports of raw materials to Bangladesh have decreased, which has had a detrimental immediate impact on the Indian textile industry. She did, however, add that our PM Mitra and PLI schemes are positive moves towards meeting national needs.

The Bangladeshi textile and garment industry accounts for over 80 per cent of Bangladesh’s total export earnings and contributes approximately 11 per cent to the nation’s GDP.