37 Bangladeshi textile and readymade garment (RMG) manufacturers have started investing in Bangabandhu Sheikh Mujib Shilpa Nagar (BSMSN) economic zone – govt. has been developing the country’s largest industrial park, the BSMSN, on 30,000 acres of land – to launch high-end apparel factories.
Where, apparel manufacturers will produce fabrics, formal shirts, t-shirts, trousers, yarn, sweaters, polo shirts, manmade fibers, blazers and sportswear. Around the US $650 million will be invested altogether.
Nevertheless, the textile and RMG investors expect to start constructing their factories in 2022. Amid the COVID-19 pandemic, local investors picking a go-slow policy as fresh lockdowns at main export destinations caused a substantial fall in demand.
Some investors have already received industrial plots at the park signing a 50-year lease.
Bangladesh Economic Zones Authority (BEZA) has been developing the allocated plots by providing them with access to gas, power, water, sewage lines and other utilities.
BEZA has also been enhancing connectivity by building roads both in and around the zone.
“So far some 48 local garment manufacturers have applied for plots at a section inside the BSMSN designated for the sector. Out of 48 applicants, 37 have so far received confirmation of getting an allotment.”
“I bought an industrial plot at the BSMSN and plan to initially invest $100 million, mainly to produce high-end textile and garment items,” said AK Azad, Managing Director of Ha-Meem Group, a leading exporter of Bangladesh.
On a cautious note Azad added, “However, I will not make this investment in the current year amidst the COVID-19 fallouts. Instead, I will start working on the new project from 2022.”
The employment figure is small, as high-end garments need less of a human touch compared to conventional garment manufacturing.
“I hope that by the end of the year, the development of industrial plots would be completed, like connections of electricity, gas and other utilities,” added Azad.
Md M Mohiuddin Chowdhury, Chairman of the Industrial Zone’s Standing Committee of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said, “So far some 48 local garment manufacturers have applied for plots at a section inside the BSMSN designated for the sector. Out of 48 applicants, 37 have so far received confirmation of getting an allotment.”
Moreover, some development activities like installation of power, gas connections, preparation of the plots and construction of internal roads and boundary walls need to be completed.
“I hope by this year, all of those activities would be completed for the handover of the plots to the investors as the development activities of BEZA are going on,” Mohiuddin Chowdhury said.
Chowdhury informed further that BEZA may hand over the plots at this year’s end.
Once the investors receive the plots, they will start the construction of their mills and factories.
“So expect that in the next two and a half years, the actual production will start. Most of the mills and factories have been planning to construct factories of global standard to produce high-end apparel items as conventional garment business has become very competitive,” said Chowdhury.
The proposed investment holds a huge prospect, like around $1,400 million worth of garment items could be exported from the proposed factories, employing about 100,000 workers.
Chowdhury informed that so far, 37 of 48 investors have either made full or partial payments for their industrial plots.
Syed Nazrul Islam, Director of Well Fashion, said recently he received his one-acre industrial plot as he was done making the payment.
Islam said, “I am waiting for another plot on two acres of land to be handed over soon to build modern factory buildings.”
With an initial investment plan of TK 1 billion to build a woven composite garment factory for manufacturing high-end products but it will take another year to start construction due to the COVID-19’s effects.
Nazrul Islam revealed, “I have a plan to construct a global standard garment factory to produce high-valued garment items.”
Md Junaid Abu Salay Musa, Director of Epyllion Group – another leading garment exporter – said he has a plan to set up a factory at the BSMSN to manufacture high-end woven and knitwear items for upscale customers in the western world.
“It would take more than one year to go for construction as BEZA was still developing the zone.”
However, BEZA Executive Chairman Paban Chowdhury said development activities on BEZA’s part have already been completed and now other government agencies were completing their parts to prepare the plots.
Paban Chowdhury said, “Some 37 RMG entrepreneurs have received their industrial plots so far as they have already paid 50% or 100% of the price. Many of them can start constructing their industrial units as BEZA has already developed the plots providing connections to power and gas.”
Adding that, “I hope BEZA can complete all the development activities by the end of the current year for investors. The BSMSN also offers options for all other industries.”