Foreign direct investment in Bangladesh’s textile and apparel sector rose 15.70 per cent in 2017 compared to 2016. South Korea made the largest investment in the country’s textile sector, followed by Hong Kong and the United Kingdom.
Since the garment sector is growing fast in Bangladesh, foreign investors choose the country as an investment for textiles. The availability of workforce at a reasonable wage, duty-free market access to major export destination, preferential location in the heart of the Asia-Pacific region and policy support have acted as a catalyst to attract FDI.
The Bangladesh Investment Development Authority provides a one-stop service. The digitized system has made the process very easy, pushing the foreign investment in the textile sector up. Bangladesh has to import a huge amount of woven fabrics to meet the local demand. Foreign investment in the textile sector will help Bangladesh build a strong backward linkage for the woven sector.
Bangladesh produces mostly basic clothing items. Foreign investment is especially valuable in high tech-fabric manufacturing and technology-based garment manufacturing to make value-added products. FDI in the textile and apparel industry will help in the production of high-quality fabrics as foreign investors have expertise in this area.