Bangladesh’s yarn production is set to expand 2.67 per cent this fiscal year on the back of rising garment exports. Cotton imports have been on the rise over the last several years thanks to higher demand from garment manufacturers. Cotton imports in Bangladesh have been increasing between 20 per cent and 25 per cent over the last few years. This year, Bangladesh’s cotton imports will increase by 25 per cent.

Of the total demand for yarn, Bangladesh imports nearly 30 per cent. These are mainly from India, China, Vietnam and Pakistan. However, garment makers use more local yarn mainly to reduce the longer lead-time. Bangladesh's 430 spinners can supply nearly 90 per cent of the demand for yarn from the knitwear sector and 35 per cent from the woven sector.

Bangladesh woven garment manufacturers import fabrics from countries like China, India, Vietnam and Pakistan. The market for clothing retail in Bangladesh is nearly $8 billion a year. Gradual development of the upstream supply chain, including spinning, dyeing, finishing, weaving and printing, creates more demand for cotton to meet the required supply to the garment industry. Yarn consumption in the local markets has increased due to higher consumption of clothing by people in the country.