Mohammed Badrul Ahsan :
Huge capital intensive and scarcity of power emerged as a major obstacle to drawing investment in the country’s woven fabric producing sector resulting failure to enhance value addition to the desired level by woven garment sub-sector over the years, industry insiders said.
According to them, woven garment sub-sector, unlike the knitwear one, has failed to enhance value addition to the desired level mainly due to the former’s large dependence on imported fabrics.
The woven garment makers are now able to add value ranging between 35 per cent and 40 per cent as they still need to import around 60 per cent of their required fabrics for production from abroad. The local textile millers, on the other hand, supply nearly 90 and 95 per cent of the required yarn and fabric to knitwear industry respectively, they added.
Though value addition by the woven sub-sector is much lower than that of knitwear, it is the largest foreign currency earner of the country.
The country earned $14.73 billion from woven garment exports while knitwear fetched $13.35 billion income in the last fiscal year (FY) 2015-16.
Earning from readymade garment (RMG) sector stood at $28.09 billion, 80 per cent of the total export earnings in the last FY, according to official data.
“Huge investment is required to set up a woven fabric unit while that of knitwear can be established with comparatively less money,” Faruque Hassan, senior vice-president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told The New Nation.
Besides, many supplementary machines like sizing, winding and many processes are needed for woven fabric making while the same is done with a single machine in knit, Faruque Hassan, managing director of Giant Group, explained.
There has been hardly any fresh investment in the industry in recent years due to power shortage and there is also a moratorium on gas connection to new industrial units, he said, adding gas supply is a must for fabric manufacturing; otherwise the business would not be competitive and sustainable.
Industry insiders, however, opined that the country enjoys duty benefit in many of its major markets including European Union though fabric for woven items is imported, which is also a reason behind less investment in woven fabric manufacturing locally.
Nearly 60 per cent demand of woven fabric is met with import, Hassan said, adding the rate of value addition was nearly 30 per cent 10 years back while it has now become 40 per cent.
“The core strength of the knitwear sector is its strong backward linkage industry that supplies almost all the required yarn and fabric except a few varieties and qualities,” Fazlul Hoque, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said.
The improvement has been possible due to the integrated growth of spinning units with the growth of the country’s stitching capacity and increased demand for yarn and fabric, said Fazlul Hoque, vice president of Bangladesh Textile Mills Association (BTMA). Though demand is gradually increasing, there has been hardly any fresh investment in fabric manufacturing except some in denim due to gas crisis
Almost all ladies items, some designed sweaters, T-shirt and polo shirt are value added products, he added. Value addition, for woven, largely takes place in denim segment as new fabric makers are joining the force despite some limitations, Mr Hassan of BGMEA said. According to BTMA, there are some 30 denim fabric makers in the country.
There are some 413 yarn manufacturing mills that spin 2,250 million kilograms of yarn annually, 792 fabric manufacturing units including 30 denim and 22 home textile with 2810 million metres capacity and 240 dyeing units having fabric processing capacity of 2720 million metres, according to BTMA. The country imported about 5.5 million bales of raw cotton in 2015, it said.
Huge capital intensive and scarcity of power emerged as a major obstacle to drawing investment in the country’s woven fabric producing sector resulting failure to enhance value addition to the desired level by woven garment sub-sector over the years, industry insiders said.
According to them, woven garment sub-sector, unlike the knitwear one, has failed to enhance value addition to the desired level mainly due to the former’s large dependence on imported fabrics.
The woven garment makers are now able to add value ranging between 35 per cent and 40 per cent as they still need to import around 60 per cent of their required fabrics for production from abroad. The local textile millers, on the other hand, supply nearly 90 and 95 per cent of the required yarn and fabric to knitwear industry respectively, they added.
Though value addition by the woven sub-sector is much lower than that of knitwear, it is the largest foreign currency earner of the country.
The country earned $14.73 billion from woven garment exports while knitwear fetched $13.35 billion income in the last fiscal year (FY) 2015-16.
Earning from readymade garment (RMG) sector stood at $28.09 billion, 80 per cent of the total export earnings in the last FY, according to official data.
“Huge investment is required to set up a woven fabric unit while that of knitwear can be established with comparatively less money,” Faruque Hassan, senior vice-president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told The New Nation.
Besides, many supplementary machines like sizing, winding and many processes are needed for woven fabric making while the same is done with a single machine in knit, Faruque Hassan, managing director of Giant Group, explained.
There has been hardly any fresh investment in the industry in recent years due to power shortage and there is also a moratorium on gas connection to new industrial units, he said, adding gas supply is a must for fabric manufacturing; otherwise the business would not be competitive and sustainable.
Industry insiders, however, opined that the country enjoys duty benefit in many of its major markets including European Union though fabric for woven items is imported, which is also a reason behind less investment in woven fabric manufacturing locally.
Nearly 60 per cent demand of woven fabric is met with import, Hassan said, adding the rate of value addition was nearly 30 per cent 10 years back while it has now become 40 per cent.
“The core strength of the knitwear sector is its strong backward linkage industry that supplies almost all the required yarn and fabric except a few varieties and qualities,” Fazlul Hoque, former president of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), said.
The improvement has been possible due to the integrated growth of spinning units with the growth of the country’s stitching capacity and increased demand for yarn and fabric, said Fazlul Hoque, vice president of Bangladesh Textile Mills Association (BTMA). Though demand is gradually increasing, there has been hardly any fresh investment in fabric manufacturing except some in denim due to gas crisis
Almost all ladies items, some designed sweaters, T-shirt and polo shirt are value added products, he added. Value addition, for woven, largely takes place in denim segment as new fabric makers are joining the force despite some limitations, Mr Hassan of BGMEA said. According to BTMA, there are some 30 denim fabric makers in the country.
There are some 413 yarn manufacturing mills that spin 2,250 million kilograms of yarn annually, 792 fabric manufacturing units including 30 denim and 22 home textile with 2810 million metres capacity and 240 dyeing units having fabric processing capacity of 2720 million metres, according to BTMA. The country imported about 5.5 million bales of raw cotton in 2015, it said.
