At New Crossroads in Global Trade: Sustainable Transformation of Bangladesh’s Apparel Industry

The global economy is undergoing a profound transformation amid multifaceted geopolitical changes. Inflationary pressures worldwide, shifting supply-chain dynamics, and fluctuations in consumers’ purchasing power have created a new landscape in the international apparel market. Driven by entrepreneurial resilience, a competitive production system, a vast workforce, and preferential market access, Bangladesh’s garment sector has continued to move forward, earning approximately US$38.7 billion in export revenue in FY2025-26 alone.
However, the rules governing international trade are changing rapidly. Stricter and evolving requirements relating to environmental and social compliance, as well as human rights due diligence, have emerged as key determinants of success in global trade. To lead in the emerging business environment, Bangladesh therefore needs a forward-looking strategic roadmap.
Product Diversification and the Need for Higher Value-Added Products
According to statistics, Bangladesh’s apparel exports remain concentrated in five major product categories: T-shirts, trousers, sweaters, shirts, and jackets. Together, these five categories account for approximately 79 per cent of the country’s total apparel exports. Although Bangladesh has developed substantial expertise and production scale in these products, this high degree of concentration also reinforces its image in the global market as a supplier of low-end basics and conventional garments. To overcome this dependence on a narrow range of products, we must diversify our export basket.
As part of this transformation, BGMEA is moving beyond the traditional focus on basic items and placing the highest priority on diversification and the production of higher value-added products. To achieve the target of US$100 billion in apparel exports by 2030, Bangladesh must move away from quantity-driven growth and a limited product range towards a model of value-driven production. This transition opens up new horizons for the industry.
Encouragingly, many forward-looking entrepreneurs have already moved beyond conventional product lines and successfully entered these specialised, high-potential segments, setting new benchmarks in the global market. By developing strong backward linkages in polyester, viscose, spandex, and recycled fibres, we are making our supply chains more self-reliant while expanding domestic production of higher-value garments.
At the same time, bold investments in high-margin specialised products, including lingerie, sportswear, outerwear, and functional apparel, are enabling us to strengthen our position rapidly in some of the most profitable and promising segments of the global market.
Compliance Challenges and Green Branding

Compliance and environmental standards have become far more significant for sustaining our position in international trade. Global buyers are increasingly prioritising carbon-emission reductions, environmentally friendly factories, and circular-economy practices, including waste recycling.
While large factories are generally better equipped to meet these requirements, many of the country’s small and medium-sized enterprises (SMEs) lack the capacity to comply with such demanding and costly standards. In this context, it is essential to provide SMEs with accessible, long-term green financing, technical assistance, and targeted policy incentives to ensure that the entire industry can undergo a sustainable transformation.
Bangladesh is globally recognised as home to one of the largest concentrations of environmentally friendly, LEED-certified green factories. BGMEA is working to leverage this achievement effectively to strengthen the country’s brand identity and establish Bangladesh more firmly as a premium, modern, and ethical sourcing hub for international buyers.
Energy Security and the 
Transition to Renewable Energy
Meanwhile, an uninterrupted supply of gas and electricity is essential for keeping our domestic production processes operational. However, rising energy prices, inadequate supplies, and frequent power outages have increased production costs and severely undermined operational efficiency in the apparel sector.
 Garment manufacturers must deliver shipments within the stringent lead times specified by international buyers. Yet gas and electricity shortages can make it difficult to complete production on schedule. As a result, manufacturers sometimes have to resort to expensive air freight to meet urgent shipment deadlines or use alternative generators to maintain production. These additional costs reduce profit margins and weaken our competitiveness in the global market.
To address the industry’s ongoing energy instability and supply constraints, BGMEA has taken strong initiatives to promote the transition to renewable and green energy.
As part of these efforts, garment manufacturers are being encouraged to install rooftop solar panels to increase their own electricity generation by making use of the extensive roof space available at factories. To accelerate this initiative, ensuring access to affordable, long-term green financing at low interest rates has become an urgent priority.
At the same time, BGMEA is actively engaging with policymakers to make it easier and more commercially attractive for factories to supply surplus solar electricity to the national grid through net metering.
Exempting solar panels, inverters, and other renewable-energy equipment from import duties and VAT, or substantially reducing these charges, would encourage factory owners to invest more extensively in green energy. There is also a growing need to establish centralised renewable-energy hubs in industrial zones.
LDC Graduation and Trade Agreement Strategies
Bangladesh is approaching its graduation from least developed country (LDC) status to that of a developing country. Following graduation, our preferential trade benefits in developed-country markets will gradually diminish. To successfully manage this transition, we must make substantial investments in the production of man-made fibre (MMF)-based apparel, in line with evolving global market demand.
At the same time, there is no alternative to reskilling and upskilling our workforce if we are to remain competitive in the era of the Fourth Industrial Revolution and AI-driven automation.
One of the most effective ways to preserve market access in the post-LDC period is to conclude free trade agreements (FTAs) or economic partnership agreements (EPAs) with major trading partners. We must accelerate negotiations and the conclusion of bilateral trade agreements with the European Union, the United Kingdom, Japan, and other major economies.
Reforms in Port Management, Customs and Financial Sector
To maintain the momentum of commercial activity, simplifying customs and bonded-warehouse procedures and improving port efficiency have become urgent priorities.
Bonded-warehouse facilities are vital to this export-oriented industry. Fully digitising and automating bond management would eliminate delays in licensing, renewals, and the importation of raw materials.
At the same time, increasing container-handling efficiency at Chattogram Port and all other land and seaports, modernising customs-clearance procedures, and ensuring round-the-clock port operations could significantly reduce lead times and further strengthen our position in the global market.
The banking sector also plays a crucial role in financial management. High interest rates on bank loans and liquidity constraints are making it increasingly difficult for entrepreneurs to invest in new facilities and modernise existing operations.
Commercial banks must make their services more business-friendly by resolving complications associated with opening back-to-back letters of credit (LCs) and conducting foreign-exchange transactions. Coordinated initiatives by Bangladesh Bank and commercial banks are essential to maintaining financial discipline and ensuring a normal flow of liquidity throughout the financial system.
Conclusion
The central objective of our future vision is to build a modern, green, technology-driven, and knowledge-based apparel industry.
Our commitments include reducing our carbon footprint through greater use of renewable energy, further strengthening working conditions and social protection for workers, and elevating the brand value of Made in Bangladesh to new heights in the global market.
Our apparel industry has overcome global recessions, economic turbulence, and numerous other challenges in the past. With collective efforts, timely policy support, modernised customs and port facilities, and a reliable supply of energy, we firmly believe that we will continue to maintain and strengthen our position in the global market in the years ahead.
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The writer is the President, 
Bangladesh Garment Manufacturers 
and Exporters Association (BGMEA)