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    Why Bangladesh is the Best for Ready Made Garment Production?

    Why Bangladesh is the Best for Ready Made Garment Production?
    Mayedul Islam
    Senior Reporter of Textile Tribune
    Assistant Chemist at Sajid Washing & Dyeing Ltd. (Ha-Meem Group)
    Email: mayedul.islam66@gmail.com

    The Ready-made Garments (RMG) sector of Bangladesh has known as the biggest earner of foreign currency. In 1978, the industry is Launched here with just nine factory and 0.069 million dollars in the foreign exchange. But in 2013-2014FY, Bangladesh earns 24.5 billion dollars of foreign currency through the Garment exports. The sector contributes importantly to the GDP. It also provides employment to around 4.2 million Bangladeshis. A majority number of workers in this sector are women. The sector has affected the social status of many women coming from low income families. Bangladesh-origin products met regularly the quality standards of customers in North America and Western Europe, and prices were satisfactory. 85% of Bangladeshi production was sold to North American customers, and virtually overnight Bangladesh became the 2nd largest exporter of garment products in the world for last three decades. After foreign businesses began building a ready-made garment industry, Bangladeshi capitalists appeared, and most of them began to organize companies in Dhaka, Chittagong, and smaller towns, where basic garments--men's and boys' cotton shirts, women's and girls' blouses, shorts, and baby clothes--were cut and assembled, packed, and shipped to customers overseas (mostly in the United States).  
    Bangladeshi workers in apparel industry
    Bangladeshi workers in apparel industry
    Though Bangladesh does not produce cotton, the country is the second largest exporter of garment products in the world. Even during the global economic recession when importers of major sourcing countries dropped significantly, our Ready-made Garments remained the most favorite choice for many countries. However, there was no magic wand that helped the sector to achieved today’s position; rather various key factors inspired for steady growth of RMG sector in Bangladesh. It is still the matter of great surprising to many that how the garment industry in Bangladesh continues to show robust performance in the world. In the behind there are number of reasons why Bangladesh has been a most favourite sourcing destination to international buyers.

    The factors which are inspired Bangladesh to become a most favorite sourcing destination to international buyers:
    1. Skilled human resources
    2. Vast labor force,
    3. Government supports for textile and clothing
    4. Technological upgrades,
    5. Creation of textile and clothing villages,
    6. Special economic/export processing zones,
    7. Duty reduction for the import of inputs/machines,
    8. Incentive for use of local inputs,
    9. Income tax reduction,
    10. And international supports like GSP, GSP+, duty free access etc.
    One of the most important key factors that caused the rapid development of RMG industry in Bangladesh is the population. Whether population is a bane for a nation depends largely on how it is managed and utilised. Besides, the development of a country’s economy hugely depends on the management of its population. The population has appeared to be the blessing for Bangladesh as it is the key factor behind success of RMG industry, which requires a good number of workforces. The demographic profile of Bangladesh’s population has helped the apparel industry to thrive. Young population (around 76 percent of the people are below 40 years of age) of this country is the main key strength of our RMG industry.

    Because of the availability of labor, the labor cost of Bangladesh is also very low compared to the other developing countries. The wages paid to RMG workers in Bangladesh are the lowest even by the South Asian regional standard, which can be easily understand from the following table, But for gaining the comparative advantage, more than physical abundance, other things like- availability of skilled labor, management skills, efficiency and productivity of labour, education and training facilities are more important. In Bangladesh, the garment workers are mostly women with little education and training. The employment of an uneven number of unskilled labors by the garment factories results in low productivity and comparatively more expensive apparels. Bangladesh labor productivity is known to be lower when compared with that of Sri Lanka, South Korea and Hong Kong. Bangladesh must look forward to improve the productivity of its labor force if it wants to compete regionally if not globally. 
    Monthly minimum wages list of garment worker
    Monthly minimum wages list of garment worker
    Note: This is according to 2013. Now Bangladeshi garment worker wages around $100

    Bangladesh’s RMG industry is now growing at a more planned way and with more facilities than before. In every factory there must have a compliance section. In the past the workers had no ID cards and they were given no appointment letters. But nowadays they have got it. The number of women working in RMG sector has always been higher. They were not given child care facilities and maternity benefits. But now all these facilities are provided.

    To reduce dependence on imported immediate materials, our RMG sector felt the need for strong support of backward linkages. The primary textile industry in the early 80s was not strong but with the growing demand for raw materials the backward linkage industry started flourishing. At present we are almost self-sufficient for knit fabric as more than 90% of knitwear fabric is manufactured in Bangladesh. Day by day our woven fabric manufacturing and processing capacity is also growing rapidly that has reached 2 billion meters per annum. Without it, currently we have around 9 million spindles installed that can produce up to 1.7 billion kgs of yarn in every year. We are also almost self-sufficient for trims and accessories. By this way, with the expansion of the RMG industry the backward linkage industries developed and have been playing very important role in reducing lead time and offering competitive price in the international market.

    Another big advantage is our duty-free access to world market over other competitors. By using the advantage of LDC we have duty-free market access to most of the developed countries including EU, Norway, Switzerland, Canada, Japan, Australia and partial market access in India, China, South Korea, Malaysia. This trade privilege also helps us offer competitive price for the buyer. The buyers also give priority to Bangladesh as we have been able to earn their confidence on timely delivery of ordered products of desired quality at very competitive price. This is one of the key factors that why global brands are choosing Bangladesh.
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