A recent study conducted by the Research and Policy Integration for Development (RAPID) titled ‘Upscaling the RMG Sector’ forecasts, Bangladesh's export earnings from MMF (Man-Made Fiber) products could surge to $19 billion within a decade if it achieves projected market shares in 20 potential products.
Currently, Bangladesh's exports primarily consist of cotton-based apparel, constituting a substantial 71 per cent of total exports. The report highlights the impressive growth in cotton apparel exports over the years, reaching $33 billion in 2021 from $3.0 billion in 2001. In contrast, MMF apparel exports have seen a more modest growth of $8 billion over two decades, indicating Bangladesh's gradual progress in this segment.
Import data of MMF or non-cotton raw materials also reflects an increasing trend, indicating a growing usage of these materials in garment manufacturing for exports. For instance, in the first quarter of 2024, Bangladesh imported 30,900 tons of polyester staple fibre, marking a significant 42.46 per cent rise compared to the same period in 2023. Similarly, imports of synthetic filament yarn and yarn of synthetic staple fibre also saw notable increases during the same period.
Despite its strong presence in the cotton market, Bangladesh has substantial room for growth in MMF and blended apparel, where it currently holds a modest 5.6 per cent global market share, compared to China's dominant 36 per cent.
However, the textile industry faces challenges, including import duties on many MMFs while cotton enjoys duty-free status, inefficient customs clearance, and complicated duty-drawback procedures. Moreover, there are discriminatory policies on PET bottle and scrap imports and limited capital investment support for the industry.
Dr Mohammad Abdur Razzaque, Chairman, RAPID, emphasises, Bangladesh could potentially earn up to $19 billion from MMF garment exports within the next five to ten years if these challenges are addressed.
To achieve this potential, the report recommends consolidating Bangladesh's dominance in the cotton apparel export market while simultaneously expanding MMF apparel production and exports. This would require modernising customs clearance procedures, attracting foreign direct investment (FDI) in the MMF sector, promoting a circular economy for sustainability, modernising technology, and enhancing management capacities and worker skills.
Fazlee Ehsan Shamim, Vice President, BKMEA, highlights the increasing imports of MMF, indicating a shift towards non-cotton fibers in production. He stresses on the need for supportive policy measures, especially in customs-related issues, to encourage entrepreneurs to explore non-cotton segments and attract investment.
