TK Group invests additional $7.5m to expand high-value polyester yarn production

Modern Syntex Limited is investing an additional $7.5 million to produce high-value polyester yarn and has secured fresh land allocation from the Bangladesh Economic Zones Authority (Beza) for this expansion.

Modern Syntex, a concern of TK Group, is already producing polyester yarn at the National Special Economic Zone (NSEZ) in Mirsharai, Chattogram. It has now taken a new 3.75-acre land lease in the same economic zone to scale up its operations further.

A signing ceremony was held at the Beza office in Dhaka on 15 April. Under the agreement, the investment will support expansion of high-value polyester yarn production, increase export-oriented value addition, and promote import substitution in the domestic market.

Confirming the development, Modern Syntex Managing Director Abu Sufian Chowdhury said, "With Beza's support, we have established a modern, technology-driven and environment-friendly industrial facility at NSEZ, which we are now rapidly expanding."

High-quality polyester yarn is a widely used raw material in the textile and industrial sectors for its durability, strength and versatility. It is blended with cotton to produce yarn used in a wide range of fabrics and finished goods, including T-shirts, sportswear, curtains, bedsheets, tyre cords and ropes.

At present, a significant portion of Bangladesh's polyester and synthetic yarn demand is met through imports from China, Indonesia, South Korea, and India. Industry stakeholders said local production helps save foreign exchange, reduce lead times, and lower costs in the industrial supply chain.

Mijanur Rahman, vice-president (finance) of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said the country's backward linkage industries remain insufficient and investment in high-value polyester yarn production would play a crucial role in addressing this gap.

He added that initiatives by large groups such as TK Group set a positive example. "With policy support and infrastructure development, more entrepreneurs could enter the sector, strengthening backward linkage and expanding the garment industry."

Existing yarn production

Company officials said its existing factory at the NSEZ was built with an investment of around Tk1,700 crore using state-of-the-art German technology. It is described as the country's first import-substituting Continuous Polymerisation plant and the only manufacturer of man-made fibre of its kind.

The facility has a daily production capacity of around 460 tonnes, producing import-substitute products such as polyester draw textured yarn, fully drawn yarn, polyester staple fibre, and polyethylene terephthalate chips. It can meet around 45% of domestic demand for these products.

Locally, Modern Syntex supplies its products to companies including Square Textiles, DBL Group, Epyllion Group, Envoy Group and Fakir Fashion.

Mustafizur Rahman, director of TK Group, said the expansion will create employment for around 120 people. He added that the company has already exported goods worth about $30 million from its existing Modern Syntex Limited plant, in addition to supplying the local market.

He further said global demand for man-made fibres is rising as an alternative to cotton, making expansion into high-value polyester yarn production a timely move.

Saleh Ahmed, executive member (investment development) of Beza, told The Business Standard that such investments by local industrial groups will help reduce import dependence. He said Beza will continue to provide all necessary support to ensure a business-friendly environment for industrial development.

According to Beza, around 15 industrial units are currently in production at the NSEZ, while about 20 more are under construction. Spanning a 25km coastal area, the zone is being developed as the country's largest planned economic zone.