Exports grow by 11% in July-February

Summary:

• Export earnings grew 11% in eight months, reaching $32.94 billion.
• Ready-made garments drove growth, contributing 81.66% of total exports.
• Knitwear exports increased 3.77%, while woven garment earnings slightly declined.
• Leather, footwear, and agro-products saw export growth, while jute declined.
• Shifting orders from China present opportunities for Bangladesh's exporters

The country's export earnings grew by nearly 11% in the first eight months (July-February) of the ongoing fiscal year compared to the same period last year.

During this period, the country exported goods worth $32.94 billion, up from $29.80 billion in the corresponding period of the previous financial year, according to the latest data from the Export Promotion Bureau (EPB) released yesterday.

Exports in February this year alone reached $3.97 billion, marking a 2.77% year-on-year increase from $3.86 billion.

The data show that ready-made garments remained the primary driver of export growth. Exports of agro-processed products, plastic products, frozen food and leather and leather products increased, while exports of home textiles, jute and jute products and engineering products declined.

Faruque Hassan said that in order to take advantage of this opportunity, the government should address four major issues: ensuring an uninterrupted supply of gas and electricity, lowering prices, improving customs services and strengthening law and order management.

The export target for FY25 is $50 billion, reflecting a 12.44% increase from the previous year.

In February of FY25, the RMG sector generated $ 3.24 billion, marking a 1.66% increase from $3.19 billion in the same period of FY24, and accounting for 81.66% of total export earnings.

Knitwear contributed $1.65 billion in February of FY25, up by 3.77% from $1.59 billion in February FY24, while woven garments earnings declined 0.44% to $1591 million from $1598 million in the same month of the previous fiscal year.

In the first eight months of the current fiscal year, ready-made garments worth $26.8 billion were exported, marking a 10.64% increase compared to the same period in the previous fiscal year.

Speaking to The Business Standard, Abdullah Hil Rakib, managing director of Team Group, said the industry has an opportunity to grow further, considering the order situation in the global market. Businesses are likely to move away from China, as the US government has increased import duties on Chinese goods, he said.

Former BGMEA president Faruque Hassan said in February, apparel export growth was very low as it was a lean period. However, overall exports have been doing very well despite some challenges over the past eight months, he said.

"We have been able to achieve double-digit growth despite the major changes in the politics following a student-led and public-supported uprising," he added.

Other sectors' performance

Among other major export sectors, agricultural products saw a positive growth of 7.03%, reaching $68.63 million, up from $64.12 million in February FY25.

Leather and leather goods increased by 11%, totalling $88.47 million in February of FY25, from $79.26 million in February of the previous year.

In February of FY25, home textiles experienced a slight decline of 0.23%, totalling $84.13 million, down from $84.32 million a year ago.

Export receipts from jute and jute goods fell by 11.39%, reaching $63.57 million in February of FY25, down from $71.74 million in February FY24.

Footwear exports saw a growth of 11.62%, reaching $88.47 million in February of FY25, up from $79.26 million in February FY24.

The pharmaceuticals sector also experienced a big fall by 22.55%, totalling $13.02 million in February of FY25, compared to $16.81 million in February of the previous fiscal year.

Prospects and challenges

Faruque Hassan expressed the hope that the coming months will be better, as some orders are shifting from China to Bangladesh due to the additional 10% duty imposed by the Trump administration on top of the existing tariffs on Chinese exports to the US from February this year.

Additionally, further tariff measures will be imposed on US imports from China and Mexico from 4 March.

Faruque Hassan said under the new tariff regulations, Chinese exports to the US will face an additional 10% duty, while Mexican exports will be subjected to a 25% duty. Previously, Mexican exports benefited from zero duty under the North American Free Trade Agreement.

China has also imposed a 15% duty on US cotton imports, the former BGMEA president said. "This duty measure will give an advantage for Bangladeshi spinning and textile millers to buy cotton at a convenient price."

Faruque Hassan said that in order to take advantage of this opportunity, the government should address four major issues: ensuring an uninterrupted supply of gas and electricity, lowering prices, improving customs services and strengthening law and order management.

He added that attracting new investment and securing new orders for Bangladesh depend on maintaining law and order, which remains a top priority for all. The government should take steps to stabilise the situation, he said.

Meanwhile, BKMEA President Mohammad Hatem said some orders have increased over the past couple of months, but prices remain challenging for exporters due to rising production costs. Adequate utility supplies also remain a challenge for the industry to meet buyers' lead times, he said. 

Hatem added that the law and order situation has yet to fully stabilise, which is essential for restoring buyer confidence.

Kutubuddin Ahmed, founder and chairman of Envoy Textiles Mills Ltd, the world's first LEED-certified denim mill, said that they have been running their factory at full capacity over the past couple of months, thanks to the influx of additional orders.  

He also mentioned that the factory has a full order forecast for the coming months.  

Referring to the reciprocal tariff measures imposed by China and the USA, he said that while these will create new opportunities in the US market, they may also impact the price of West African cotton, which is comparatively cheaper than US cotton. "Generally, Bangladeshi millers use West African cotton to minimise their costs," he added.