The Asian Development Bank (ADB) has signed a loan agreement with Bangladesh's BRAC Bank to finance the construction and upgrade of ready-made garment factories in Bangladesh that have taken steps to meet global standards and improve rights and safety of workers. The $30 million loan will also be used to build the badly-needed effluent treatment facilities in the textile and garment industry.
ADB in a statement said many factories in the country still operate without effluent treatment plants, resulting in widespread water pollution which is particularly damaging rural areas where communities rely on surface water for washing, bathing, irrigation and fishing. Bangladesh is the world's second largest exporter of textiles and garments, accounting for over 80 per cent of country's merchandise exports in fiscal year 2014, and employs 4.2 million workers.
The bank however, said the industry has suffered setbacks after two disasters in recent years - the 2012 Tazreen factory fire and the 2013 Rana Plaza building collapse. In the wake of these events, the Bangladesh government entered into a compact with the European Union, the United States, and the International Labor Organization to commit to improvements in building safety, labor rights, and business conduct.