Amid negative growth in woven products export earnings, Bangladesh’s export shipment of knitwear goods posted a 1.20% growth to $16.44 billion in the last year.
Talking to Textile Today, trade analysts and sector people have given credit to the strong backward linkage industry of the knitwear sector for the growth.
According to the Export Promotion Bureau (EPB) data, Bangladesh earned $16.44 billion from knitwear export in 2019, which was $16.24 billion in the previous year.
On the other hand, export earnings from woven products declined by 0.30% to $16.63 billion, which was $16.68 billion in the previous year.
However, in the last year, overall export earnings from the apparel sector saw a 0.44% decline to $33.07 billion.
“Bangladesh has a very strong backward linkage industry for knitwear goods. About 85% of demands of fabrics can be met by local manufacturers,” Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) first Vice President Mohammad Hatem told Textile Today.
These manufacturers offer quality fabrics at a reasonable price, which is an advantage for the sector in remaining competitive in the global markets, said the business leader.
On the other hand, due to a strong local supply chain, manufacturers can ship goods within shorter lead times, he added.
As a result, global apparel retailers and brands are buying goods from Bangladesh, which helped the sector to remain in positive territory, said Hatem.
Currently, local manufacturers are capable of supplying 85% of yarn and fabric, along with 40% of woven fabric, required by the knitwear sector.
As per BTMA, there are 430 yarn manufacturing mills, 802 textile mills, and 244 dyeing-printing finishing mills in Bangladesh, along with 32 denim fabric manufacturing mills and 22 home textile manufacturing mills.
“The backward linkage is an advantage for Bangladesh, which can help the country to increase the export earnings further even double-digit growth could be restored,” Khondokar Golam Moazzem, Research Director of Centre for Policy Dialogue (CPD) told Textile Today.
For tapping the opportunity of backward linkage as a tool of fortune, it is high time for manufacturers to concentrate on higher value-added goods as well as fancy items, said the economist.
On top of that, the sector people have to install the latest technology in improving the product quality as well as automation is needed for the sector, he added.
Meanwhile, another economist also called for proper steps from the government and the exporters to capture the relocation of Chinese business.
“Though there was a huge opportunity for Bangladesh to earn from US-China trade war, we cannot grab the share,” Mohammad Razzaque, Research Director of the Policy Research Institute told the Textile Today.
Right now, the government should have an assessment of the direction on how manufacturers can gain from the US-China trade war as well as the relocation of investment from China, he said.
The analyst also suggested identifying new avenue of goods, which have prospects and are being sourced from China as the buyers are fleeing from the country and looking for new sourcing points.