Apparel leaders push for lower costs, policy overhauls to stay competitive

Leaders of Bangladesh's apparel industry have urged the government to reduce freight costs and bank interest rates, streamline logistics, and cut import tariffs to preserve the sector's competitiveness, particularly in the US, amid escalating global trade tensions.

At a discussion held in Dhaka today (12 April), industry representatives also stressed the need to boost productivity through advanced technologies and called for political stability, safety, and regulatory certainty to navigate the ongoing phase of geo-economic turbulence.

They further recommended targeted incentives to offset the higher cost of importing cotton from the US, aiming to narrow the widening trade gap between the two countries.

Anwar-ul-Alam Chowdhury Parvez, former president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), highlighted key operational challenges.  

"Interest rates remain high, gas prices have tripled, and though we're being asked to operate in economic zones, those zones are far from fully developed," he said.

Criticising customs inefficiencies, he added, "Why does it take 10 days to clear goods at ports when it should take only three? And after a decade of consistency, why has the HS code product assessment process abruptly changed?"

Parvez also dismissed the notion that Bangladesh enjoys a cost advantage through cheap labour.  

"If we compare ourselves to Vietnam, their transportation, financing, and logistics costs are much lower. Factoring these in, our production costs are nearly the same," he noted, calling for long-term policy consistency and stable governance.  

"These issues stem from government policies, not from the private sector," he said.

Mohammad Hatem, president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), warned of post-LDC graduation pressures, saying that high duties on imported man-made fibres continue to hamper competitiveness. 

"We need a tariff structure that reflects future challenges, not past norms," he said.

Kutubuddin Ahmed, chairman of Envoy Textiles Ltd and a former BGMEA president, drew attention to the high cost of air freight, stating, "Air cargo from Bangladesh is among the most expensive in the world, prompting many exporters to use Indian ports for third-country shipments."

He questioned the government's investor engagement priorities, asking, "We hold conferences to attract foreign investors, but when have we hosted one to listen to local entrepreneurs?"

Addressing the cost disparity in US cotton, Ahmed pointed out that it is roughly four cents more per pound than cotton from other origins.  

"If the government offers that amount as an additional incentive for sourcing from the US instead of the current general cash support, it would encourage importers and support bilateral trade," he said.

He also highlighted the importance of productivity, sharing a case from his own factory: "When gas prices rose, our bill jumped by Tk56 lakh. We investigated and found over 1,100 leaks in the boiler pipeline. Fixing them now saves us around Tk49 lakh every month."  

He urged other entrepreneurs to prioritise such efficiency audits, noting that some factories are already outperforming the national productivity average.

The event, titled "Bayla Roadmap 2030: Resetting the Competitive Edge; Rethinking Bangladesh's Apparel Industry", was organised by the Bangladesh Apparel Youth Leaders Association (Bayla) at a hotel in the capital's Gulshan area.

Other speakers included BGMEA Administrator Mohammad Anwar Hossain, former BGMEA president Faruque Hassan, and Sharif Zahir, managing director of Ananta Group. Bayla President Abrar Hossain Sayem moderated the session and presented the association's strategic roadmap for 2030.