Why Ctg, birthplace of Bangladesh’s RMG, is losing its edge
The city now contributes roughly 10–12% of Bangladesh’s total garment exports
Bangladesh's first garment exports began from Chattogram. In 1977, on about nine acres of land in the Kalurghat industrial area, retired government official Nurul Qader established Desh Garments, marking the start of the country's apparel industry.
Since then, the industry has grown to about $48 billion today. But over time, while the export-oriented garment sector has expanded across the country, Chattogram has fallen behind.
According to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), there are 620 registered garment factories in Chattogram, but only 343 are currently operating, while 277 remain closed, employing about 5 lakh workers. The Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) lists 110 member factories in the region, of which 91 are actively exporting. Some factories are registered under both associations.
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The city now contributes roughly $5 billion, or 10–12%, of Bangladesh's total garment exports.
Industry stakeholders say that once 40% of Bangladesh's export-oriented garment sector was based in Chattogram, but this has now dropped to 10–12%. The main reasons are delays in infrastructure and transport development, and unreliable utility supplies essential for continuous production.
Beginning and expansion in Ctg
After the Liberation War, Nurul Qader resigned from government service in 1973. Turning to business, he later partnered with South Korea's Daewoo Corporation to establish the country's first export-oriented garment factory, Desh Garments.
Before production began, 130 officers and workers were sent to South Korea for six months of training. They went on to pioneer the industry in Bangladesh – some even establishing their own factories later. Thus began the country's main export sector.
According to industry insiders, the expansion of the garment sector from Chattogram was initially driven by the US quota system. In the 1980s, developing countries received garment orders under export quotas.
Bangladesh became eligible for these under the Multi-Fibre Arrangement (1974–94). As a result, garment factories began sprouting up in Chattogram. In 1983, the government, prioritising the export sector, established the Chittagong Export Processing Zone (CEPZ).
Although the Multi-Fibre Arrangement expired in 1994, the quota system was renewed under the World Trade Organisation's Agreement on Textiles and Clothing (ATC), which remained effective until 31 December 2004.
During this period, a cluster of export-oriented garment factories – mainly focused on the US market – developed around the port city. The industry flourished under industrial groups such as Asian, Pacific, KDS, Clifton and Youngone. For example, Youngone surpassed the $1 billion export milestone, while Pacific Jeans continues to lead Bangladesh's denim exports.
Japan's multinational retailer Uniqlo is one of its major buyers, alongside C&A, Tesco, Marks & Spencer and Tom Tailor. Pacific Jeans now exports to 52 countries worldwide.
Ctg's decline due to poor infrastructure
BGMEA data show that between 1991 and 2000, about 40 new factories were established each year in Chattogram. From 2006 to 2015, the number dropped to around 17 per year, and from 2016 to 2025, fewer than 10 new factories have been set up annually. Many have also closed in this period. These figures reveal that the rate of new factory establishment has halved over the decades.
Mohammad Abdus Salam, managing director of Asian Group and former first vice-president of BGMEA, told The Business Standard, "The major expansion of the garment industry began around 2005. From then on, new gas connections in Chattogram were stopped, while areas around Dhaka continued to receive them. As a result, textile, spinning and garment factories began growing rapidly near Dhaka. Factory owners there also benefited from the Kamalapur Inland Container Depot (ICD)."
He added that lower land prices around Dhaka played a role as well. "If you have to spend Tk50 crore just on land, you won't have enough left to buy machinery. That was a major factor. Buyers from Europe could visit Dhaka, complete their work, and return easily due to better connectivity."
Mahiuddin Chowdhury, managing director of Clifton Group, said that during the expansion years, Chattogram lagged because of poor communication facilities. "The Dhaka–Chattogram highway was in bad shape. There were no international flights. Banking and government facilities became Dhaka-centric. That's why Chattogram fell behind. Once, 40% of garment exports came from here; now it's about 10%."
Signs of potential
Despite lagging over the past two decades, stakeholders believe Chattogram still holds potential. Clifton Group's Mahiuddin Chowdhury said that if gas supply through LNG continues, and utility access and a garment village are established in the Mirsarai Economic Zone, expansion is possible again.
Abdus Salam added, "We're working to increase exports beyond the US, especially to Europe. The government needs to provide policy support. The issue of counter-tariffs imposed by the US has already been resolved, but we now need to prepare for LDC graduation. Bangladesh isn't ready yet. With the right policy backing, the garment sector still has room to grow."
