The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) have strongly opposed the government’s decision to impose duties on yarn imports, warning that the move could pose a serious threat to the country’s export-oriented apparel industry.
At a joint press conference held at Pan Pacific Sonargaon Hotel, Dhaka, BGMEA Acting President Mr. Salim Rahman said the garment sector Bangladesh’s main foreign exchange earner is already under severe pressure due to global market slowdown, geopolitical instability and domestic energy constraints. He termed the proposed yarn import duty a “suicidal decision” that could further weaken the industry at a critical time.
Mr. Salim Rahman noted that the garment sector accounts for 82 percent of Bangladesh’s total export earnings, with knitwear alone contributing 55 percent, equivalent to around USD 27 billion, while also providing employment to millions. He emphasized that the sector’s growth since the 1980s has largely depended on duty-free import of raw materials under the bonded warehouse facility.
Referring to trade data, the BGMEA Acting President said that while knitwear exports grew by 9.72 percent in FY2024–25 compared to FY2022–23, yarn imports also increased significantly, which is consistent with market economy principles. “When exports grow, imports of raw materials will naturally rise. Presenting this reality negatively and considering withdrawal of bonded facilities is unjustified and dangerous for the industry,” he added.
Mr. Salim Rahman further alleged that the decision was taken unilaterally by the Tariff Commission while discussions were ongoing, calling it a violation of Article 334 of the WTO Safeguards Agreement, which requires clear proof of ‘serious injury’ to local industry through a transparent investigation before imposing such duties.
Highlighting competitiveness issues, he said local spinning mills are offering yarn at prices around 40 cents per kg higher than international market rates, making it unrealistic for exporters to compete globally where even a marginal price difference can result in order losses.
Speaking at the same press conference, BKMEA President Mohammad Hatem said that domestic spinning mills are currently unable to supply Man-Made Fibre (MMF) yarn and special blended yarn, which are increasingly demanded by international buyers. He also pointed out that local mills cannot consistently provide premium-quality yarns required by buyers within the stipulated time.
“Buyers are asking for MMF, special blended yarn and high-quality yarns, but our domestic spinning mills do not have the capacity to supply these products adequately. If imports are restricted, exporters will lose orders and production schedules will be disrupted,” BKMEA President Mohammad Hatem warned.
Both BGMEA and BKMEA leaders stressed that artificial tariff protection could create a monopoly, disrupt supply chains and ultimately reduce exports. They urged the government to support local spinning mills through direct incentives, uninterrupted gas and electricity supply, tax concessions and access to low-interest financing, rather than imposing import duties that could harm the entire apparel value chain.
The industry leaders concluded by calling on the government to immediately withdraw the yarn import duty in the interest of economic stability and the global competitiveness of Bangladesh’s ready-made garment sector, warning that failure to do so may compel them to take tougher steps to protect the industry’s survival.
