Gas Crisis Threatens Sector Stability, Exports, and Livelihoods
⚠️ Executive Summary
The textile and Ready-Made Garment (RMG) sector in Bangladesh—contributing over 84% of national exports and employing more than 4.2 million workers, mostly women—is experiencing a critical disruption caused by a sharp decline in industrial gas supply. The gas shortage has paralyzed operations in many factories, threatened export commitments, and exposed the sector to rising risks in loan default, wage payment delays, and reputational damage in global markets.
📉 Current Impact Snapshot
According to industry bodies (BTMA, BGMEA, BKMEA, BTTLMEA), the situation has deteriorated rapidly since mid-April 2025. Factories are unable to maintain their production schedules, leading to a chain reaction of order cancellations, supply chain disruptions, and financial strain.
Updated Key Statistics (as of May 2025):
| Metric | Current Value | Change | Source |
| Gas Supply to Industry | ~900 mmcfd | ↓ by 100 mmcfd | TITAS |
| Factory Output | 55–65% capacity | ↓ by 35–45% | BGMEA |
| RMG Export Growth (Apr 2025 YoY) | -7.2% | ↓ from +2.5% | EPB |
| Factory Order Cancellation Rate | ↑ 18% | Highest since COVID-19 | BKMEA |
| Worker Wage Risk (June forecast) | ~28% factories affected | ↑ from 12% in March | BTTLMEA |
| Avg. Order Lead Time | ↑ 5–10 days | Buyers shifting orders abroad | Trade Partners |
Graph: Declining Gas Supply vs. Export Output (Jan–Apr 2025)
A significant drop in gas supply from January to April 2025 has mirrored a fall in export volumes, showing the industry’s dependence on stable energy inputs.
🔍 Root Causes (Expanded)
1. Aging Infrastructure
TITAS and Petrobangla pipelines are outdated and poorly digitized, lacking EVC (Electronic Volume Correctors) in many clusters.
2. Global LNG Market Volatility
Bangladesh’s reliance on volatile spot markets for LNG has led to pricing shocks and inconsistent industrial allocation.
3. Prioritization Dilemma
Energy authorities have diverted gas towards residential and power needs, leaving export industries under-supplied.
4. Regulatory Inertia
Despite multiple proposals submitted by industry task forces, a national energy security policy for export sectors is still pending.
🌐 Global Comparison
| Country | Energy Strategy | Outcome |
| Vietnam | Hybrid solar-industrial zones | Stable RMG production |
| India | Industrial gas corridors | Smooth export delivery |
| Turkey | Subsidized gas for exporters | Competitive pricing sustained |
| Bangladesh | No fallback mechanism | 35–45% production drop |
📌 Insert Visual: “Comparative Energy Strategy Infographic”
💥 Financial & Social Fallout
- Wage Payment Delays: Eid bonus disbursements face uncertainty. Factories in Narayanganj and Ashulia report potential 28% worker impact.
- Export Loss Forecast: Q2–Q3 2025 may see $2B in potential RMG export losses if the crisis persists.
- Loan Stress Signals: Sector-specific banks report early NPL increases as payment delays mount.
- Order Shifting: European buyers are moving volume to India, Vietnam, citing Bangladesh’s delivery unreliability.
🛠️ Recommendations (with Callouts)
✅ Government Callouts
- Prioritize gas for export-oriented factories under national emergency provisions.
- Form an RMG Energy Security Taskforce with weekly operational reports.
- Use LNG reserves strategically during peak production cycles (pre-Eid, Christmas season).
✅ Industry Action Callouts
- Adopt Solar-Backup Systems in EPZs.
- Energy Audits to identify low-efficiency equipment.
- Energy Cost Pass-through Models for pricing stability with buyers.
🔮 Future Outlook
If the current trajectory continues unchecked:
- ~30% of export orders could shift out of Bangladesh by Q4 2025.
- Widespread layoffs and unrest are likely if wage disruptions persist.
- Bangladesh’s brand as a dependable textile hub is at risk, particularly with EU and US retailers.
🧩 Closing Thoughts
This gas crisis is not just a supply issue—it’s a full-spectrum threat to employment, foreign exchange earnings, and industrial confidence. Yet, within this crisis lies an opportunity for policy-driven modernization, renewable integration, and resilience planning that can future-proof the textile sector.
Author: Farhana Shraboni
Assistant Merchandise Manager, Dongyi Sourcing Ltd.
