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Bangladesh's Denim Dominance: A story of investment, innovation, and sustainability

 

Bangladeshs Denim Dominance A story of investment innovation and sustainability

 

Bangladesh has become a major player in the global denim market, establishing itself as the leading supplier of denim garments to the US and EU. This success story is driven by a combination of factors, including significant investments, a focus on innovation, and a commitment to sustainability. Bangladesh today is the world's second-largest exporter of denim clothing, accounting for 22 per cent of global exports in 2022 as per WTO. This translates to an annual export value of almost $8 billion as per BGMEA. Industry analysts project Bangladesh's denim output will at 8-10 per cent each year in the foreseeable future.

What’s more, the denim sector directly employs over 1.1 million people in Bangladesh, with millions more jobs indirectly supported. Bangladesh has a manufacturing capacity of over 500 million denim garments and over 1.5 billion meters of denim fabric annually. The country has over 42 denim mills with a manufacturing capacity of over 900 million meters of denim fabric annually.

Factors driving Bangladesh's denim leadership

The rapid growth in denim sector has been due to several factors.

Increased investments: The Bangladeshi government and private sector have significantly invested in the denim industry, leading to the establishment of state-of-the-art denim mills. Investments have grown from Tk 8,000 crore to Tk 25,000 crore in a decade.

Focus on innovation: Bangladeshi denim mills are continuously developing new materials, treatments, and washes to cater to the evolving fashion trends.

Sustainability efforts: The Bangladesh Denim Alliance (BDA) is a leading initiative promoting sustainable practices in the denim production process, aiming to reduce water usage and eliminate harmful chemicals. And as per BDA there has been a 32 per cent decrease in water consumption and significant advancements in eliminating hazardous chemicals in Bangladesh's denim production since 2020.

Strategic location: Bangladesh's proximity to major markets like the EU and the US offers logistical advantages for denim exports.

Skilled workforce: Bangladesh has a large pool of skilled workers in the garment industry, contributing to efficient denim production.

Table: Bangladesh Exports to the US and EU

Year

Denim exports to US (in $million)

Denim exports to EU (in $ million)

2022

942.96

1560

2023

649.96

1200

Denim exports a challenge

Denim exports to the US and EU declined in 2023 due to a sluggish global market and high production costs in Bangladesh. Also, the Ukraine war and economic slowdown have had an effect. Moreover, countries like Pakistan and Vietnam are emerging strong competitors in the denim export market. To tide over this situation Bangladesh needs to embrace automation and data-driven decision-making can further enhance efficiency and competitiveness.

Overall Bangladesh's denim industry exemplifies a remarkable success story. Through strategic investments, a skilled workforce, and a commitment to sustainability and quality, Bangladesh has emerged as a dominant player in the global denim market. The country is well-positioned to capitalize on future opportunities by embracing innovation and upholding its commitment to responsible production practices. The denim industry's success transcends economic indicators, fostering social development through increased employment, skill development, and industrial transformation. Bangladesh's denim story serves as a compelling example of how well-timed investments can drive innovation, sustainability, and the rise of developing nations in the global economic landscape.

 
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