Bangladesh's knit clothing exports to Japan are set to rise as Asia's economic powerhouse has relaxed origination rules. Japan has relaxed the preferential rules of origin under the Generalised System of Preferences (GSP) for apparel and clothing accessories, knitted or crocheted.

As per the new rule, knitwear exports from Bangladesh will enjoy GSP (zero tariffs) even if the knitwear product is made of imported fabrics. For further relaxation of GSP rules, local exporters will get more preference in the Japanese market. It will also help knitwear items to grab more market shares in that country.

In April 2011, Japan relaxed its GSP rules of origin from 2-stage to 1-stage for woven apparel and 3-stage to 2-stage for knitwear. Now Bangladesh can export any readymade garment item (woven or knit) free of duty to Japan, even though the fabric is local or imported.

Japan is one of the most important non-traditional markets for Bangladeshi apparel products. Some non-cotton knitted items have a good demand in the Japanese market which Bangladesh earlier could not export under the GSP scheme as such fabric is not locally produced.

The new relaxation will not have any negative impact on local textile millers. Rather exporters will be able to import the fabrics that are not locally produced and add more value.