The decline in Western garment orders has significantly impacted cotton exports to Bangladesh, a country heavily reliant on its $45 billion clothing industry, which employs over four million workers. The situation has arisen as Western firms temporarily halt new orders amid ongoing political unrest and violence in Bangladesh. This pause has created a ripple effect, adversely affecting the Indian textile industry, which supplies raw materials to Bangladesh.
Despite efforts to ramp up production and clear backlogs, industry sources indicate that the lack of new orders from Western companies is leading to a decline in cotton exports from India to Bangladesh. M. Rafeeque Ahmed, Chairman of the Farida Group, noted that while production is resuming in areas like Dhaka and Chittagong, the overall order flow from Western firms remains stagnant. He emphasized that workers are putting in extra hours to meet existing commitments, but the future remains uncertain as new inquiries are not forthcoming.
Chandrima Chatterjee, Secretary General of the Confederation of Indian Textile Industry (CITI), highlighted that while there are inquiries for garments coming to India, the immediate impact on exports of input materials to Bangladesh has been negative. She pointed out that the Indian textile sector is facing challenges in matching the qualitative and quantitative demands of Western companies, which are increasingly looking towards alternatives like Cambodia, Vietnam, and Indonesia.
The Bangladeshi textile sector, which accounts for over 80% of the country’s total export earnings and contributes approximately 11% to its GDP, is experiencing significant strain due to rising input costs and a weakening electricity generation infrastructure, exacerbated by the Russia-Ukraine conflict and adverse weather conditions.
In light of these developments, Indian officials have expressed hope that the situation in Bangladesh will stabilize soon, allowing for the resumption of normal trade relations. India remains a crucial partner for Bangladesh, with bilateral trade reaching $13 billion in the last financial year, and cotton being a major export from India, accounting for nearly 35% of its total cotton exports.
