Bangladesh’s terry towel exports declined 4.40 per cent year-on-year in the last fiscal year. This is true of Bangladesh’s exports of home textiles in general. Around a dozen small and medium factories have reportedly shut down. Currently, some 90 factories are in operation. The sector’s growth started to decline from January 2014 when the European Union (EU) allowed zero-duty benefit to Pakistan under its GSP Plus scheme on export of home textiles and some other products. As a result, the impact was too severe for local manufacturers and exporters.

A relatively new item in the country’s export basket, terry towels demonstrated great promise due mainly to the easier production process and market access made easy by the EU’s EBA (Everything but Arms) scheme allowing duty free facility to all LDC exports, except arms. Coupled with it, there is the preferential duty facility under the EU GSP scheme meant only for less developed countries like Bangladesh.

Home textiles include mainly terry towels, bed sheets, linen, curtains and pillow covers. The very fact that exports of home textiles are in a bad shape is clear from the abundance of these products in street shops sold at throwaway prices. Bundles of terry towels are lodged on the shoulders of hawkers at busy road intersections instead of being packaged to be exported to North America and the EU countries.