Bangladesh Garment Industry: A Catalyst for the Development of Bangladesh

Bangladesh garment industry is the 2nd highest garments exporter in the world. About 80 percent of the total foreign trade has been earned from this sector. In the last December, Bangladesh earned total $3.2 billion from the apparel exports. The amount is the highest in the South Asian countries.

Can you remember the collapse of The Rana Plaza? It was also a beautiful morning of April 2013. All the workers were working attentively. All of a sudden, the eight stored building was trembling such as it was an earthquake. The human-made accident cost 1130 valuable lives of the workers whose hard work and sweat the Bangladesh garment industry stands on.

However, according to Bangladesh Garments Manufacturing and Exporting Association (BGMEA), in Bangladesh, there are 4452 garment factories in which clothes and apparel are manufactured. In these garments, more than 3 million employees are working day and night that brings the valuable foreign currency.

Overview of Bangladesh Garment Industry

Bangladesh garment industry always maintains the quality works with low labor cost. As Bangladesh has a huge population, labor cost is comparatively lower here. Though, the situation is changing after the collapse of Rana Plaza. Still, employees who are working here, live a bitter life.

By the way, Bangladesh gained in the race of the exports in 2015 when neighboring countries were falling. It was a surprising pattern that Bangladesh can expect better.

The working environment of the Bangladesh garment industry is improving nowadays. Different organizations combining with the foreign clients and government agencies are supervising the whole environment.

But time doesn’t go consistently. The situation is changing, and for this reason, Bangladesh now has to face challenges from the competitors. The termination of some treaties including EU and USA has made problems for the fast-growing industry of the country.

Now, Bangladesh is optimistic enough to regain the market of the largest Bangladesh textile industry products.

Bangladesh Garment Industry History

In the late 1950s, western world had taken the projects of Readymade garments. Under the projects, it was necessary to import readymade garments from the developing nations like Korea and China. To maintain the level of quality, Multi-Fibre Agreement (MFA) was signed in 1974.

Under MFA, 6% increasing rate will be imposed on the quantity of the readymade garments every year. The rate was enough to explore the industry.

At first, the Korean company “Daewoo” launched the factory in Bangladesh. As pioneering the industry, Daewoo recruited some Bangladeshi employees. The employees were sent to Korea to receive better training for a better result.

After having received the training, the Bangladeshi workers returned to Bangladesh and worked under Daewoo. But they thought something different. After few months, the employees broke the tie. They started the independent factory, and Bangladesh garment industry was established.

From then, almost 4500 factories were established where about 4 million employees were working all day long on a different shift.

Year No. of Garment Industries Employment in Million Workers
1983- 84 134 0.040
1988- 89 759 0.317
1993- 94 1839 0.827
1998- 99 2963 1.500
2003- 04 3957 2.000
2008- 09 4925 3.50
2009- 10 5063 3.60
2010-11 5150 3.60
2011-12 5400 4.00
2012-13 5876 4.00
2013-14 4222 4.00
2014-15 4296 4.00
2015-16 4328 4.00
2016-17 4482 4.00

Bangladesh Garment Industry Facts

A recent survey conducted by Marks and Spencer showed the unexpected lives of the Bangladesh garment industry employees. The Bangladesh textile industry workers live a miserable life with the possible minimum income.

The average basic salary of the workers is about $68 which is the lowest among all other manufacturing countries. The 6500 Taka basic pay is not enough at all to live the minimum standard life. Though the employees get TK 8000 along with the overtime and it is not fair enough.

The study shows that at least TK 15000 is required to maintain a three-membered family with standard quality. Here, how will the life go with the half of the required money?

Bangladesh Garment Industry Statistics

Though China is the largest shareholder of the garment industry, the position of Bangladesh in the garment export industry is also considerable. Bangladesh garment industry has 5.1 percent share in the global market of $503 billion.

Here, China has the largest share of 38.6 percent while India and Vietnam combining percentage is 3.7 percent. Bangladesh gas the second largest share with 5.1 percent individually, international trade statistics of world bank says.

Recently, China is losing the contract for higher employee salary and other workplace problems. So, Bangladesh is the largest source of getting readymade garments for the customers after China.

In the fiscal year 2014-15, Bangladesh garment industry earned $25.50 billion by exporting clothing and textile including shirts, trousers, jackets, sweaters, and pants.

Later year, in fiscal 2015-16, Bangladesh garment industry combining with Bangladesh textile industry exported clothing and apparels worth $25.08 in just 11 months.

For the current year, the exporting target is set at $27.37 billion. All the major partners of garment and apparel industry are increasing their orders to get more products from Bangladesh.

At present, European countries and united states of America are the major buyers of apparels and readymade garments. From the buyers, H&M is the largest buyer of apparel and clothing from Bangladesh. Their annual order is worth about $3 billion per year.

Again, the retail giant Walmart is the largest buyer from the USA. Walmart purchase $2.5 billion worth of apparel and garments T-shirts, kids-wears, trousers, and sweaters.

In the British market, Primark takes out $1.0 billion worth of products including trousers, T-shirts, shirts, and sweaters.

Some famous brands such as Hugo Boss, Tesco, M&S, Levi, Adidas are the major buyers of Bangladesh garment industry products.

Bangladesh Garment Export Statistics

The lion’s share of the Bangladesh foreign currency has been earned from Bangladesh garment industry by exporting apparels and readymade garments. More than 80 percent of the foreign exchange reserve is from Bangladesh textile industry.  Here is a statistics providing from BGMEA to compare the total earning from the sector.

Comparative Statement on Export of RMG & Total Export of Bangladesh

Year Export of RMG (In Million US$) Total export of Bangladesh (In Million US$) % of RMG’s to total Export
2010-11 17914.46 22924.38 78.15
2011-12 19089.73 24301.90 78.55
2012-13 21515.73 27027.36 79.61
2013-14 24491.88 30186.62 81.13
2014-15 25491.40 31208.94 81.68
2015-16 28094.16 34257.18 82.01
2016-17 28149.84 34655.92 81.23

*Data Source Export Promotion Bureau  Compiled by BGMEA

Though the contribution was too little a decade ago, Bangladesh has skyrocketed in exporting readymade garments from the current decade.

However, it is expected that Bangladesh will acquire the first position soon for its cheaper labor costs than China.

Bangladesh Garment Industry Working Conditions

Working in the safe place is the fundamental right of the workers, according to the international labor organization. But it is a regret for the workers who are working all day long in the RMG. They didn’t get sufficient healthy working environment before Rana Plaza Tragedy.

After Rana Plaza collapse, by losing 1130 lives, the authority agreed to reform the working environment by getting continuous pressure from the buyers.

But, after more than four years, many garment factories are still unhygienic and unhealthy. Workers are bound to work continuously in the unsafe environment.

The research was conducted to know the hidden truth of the working circumstances of the largest exporting sector of the developing nation. More than 300 workers from 100 different factories were interviewed. The interviewee was ensured and free from all fear.

The biggest problems and complaints are unsanitary conditions, narrow emergency escape, physical assault, denial of maternity leave, forced overtime and verbal abuse.

But the most unexpected and sorrowful complaint is that the workers do not get their salary and bonus in due time.

After the tragedy of Rana Plaza, the buyers set up to conditions for the safety of the workers. First is the building safety and the next is the accord of fire. A combination of 180 European firms and the Alliance for Bangladesh Worker Safety have been working since the collapse.

Top 10 Garments in Bangladesh

Bangladesh is now the second largest exporter of readymade garment and apparels next to China. She is generating about $30 billion which covers 80 percent of the total export. Now, Bangladesh has set up a goal of achieving $50 billion by exporting readymade garment and apparels by 2021.

BGMEA, the association of the owners of garment factories, maintain the list of the members. About 4500 member factories are enlisted. But some garments owners are always keeping the top list of the exporting.

Here is the list of top 10 garment factories in Bangladesh Garment Industry.

    1. Ha-meem Group
    2. Beximco Fashions Ltd.
    3. Square Fashions Ltd.
    4. Opex Sinha Group
    5. Fakir Group
    6. DBL Group
    7. Epyllion Group
    8. Standard Group
    9. Asian Apparels Ltd.
    10. Givensee Group of Industries Ltd.

Difference Between Bangladesh Textile Industry and Garment Industry

Bangladesh textile industry is also a fundamental part of Bangladesh garment industry. Though it seems that the duos are same, but has a huge difference.

The meaning of textile is everything related to fabric. It includes fabric manufacture, material relation with other ingredients, fabric relating to weaving and knitting, fiber from fabric, Yarn, grease fabric, fabric process and garments from fabric.

On the other hand, the garment is everything related to apparel. Apparel includes all sorts of clothes. Garments, clothing, dresses, sportswear, jackets, bags, towels, eyewear, footwear, caps all are including in the apparel.

Mainly, Bangladesh exports apparel to the foreign markets such as European, USA and other markets.

Conclusion

Bangladesh garment industry is the biggest contributor to earn foreign currency. Though remittance also plays a pivotal role, it is now a dying industry. On the other hand, Bangladesh textile industry is a fast-growing sector to compete for the global challenges.

The workplace environment is hazardous for the workers. As a result, some disasters like Rana Plaza Tragedy, Tajrin Garments tragedy had happened.

Following the disasters, different interested and related parties have been conscious. They are now interested and bound to improve the situation by getting continuous pressure.

Still, some garments don’t pay the fair wages to the workers. Also, the workers don’t get the salary at the right time.

However, concerned authorities now have an in-depth look to solve the problems. Government is also interested in making the garment workers happy.

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