Garment industry is the most important sector in the economy of Bangladesh. In addition to the highest export earnings, the sector has been making a major contribution to the employment of millions of people for the last four decades. In the field of women’s empowerment, the garment industry is ahead of any other sector. Due to the versatile facilities of the government, cheap labor and the hard work of the entrepreneurs, Bangladesh has been able to occupy the second position in the export of readymade garments.
After the collapse of Rana Plaza in Savar, the garment industry of Bangladesh suffered a major blow. However, in the last seven years, due to various initiatives, it has turned out quite well. However, in the ongoing coronavirus epidemic, the country’s highest export earnings sector is once again facing a major catastrophe. Many entrepreneurs in the sector were shocked when one purchase after another was canceled and suspended in March when Corona took a terrible turn. However, in a few days the situation improved a bit. Exports continue to grow slowly. However, even if the situation improves temporarily, Corona will have to face various challenges in order to survive in the garment export business in the future. It will take initiative of the entrepreneurs as well as the concerned departments of the government. The point is, we need to be quick to adapt to changing circumstances.In today’s report, we will discuss the challenges and challenges of the next garment sector. But before that I will know some information about the basics of the garment sector. So that a complete picture of the garment sector is available.
The story of the beginning of the garment industry
Desh Garments started its journey of exporting 198 garments. After retiring from government service, Mohammad Nurul Quader established a factory called Desh Garments at Kalurghat in Chittagong. At that time no worker-owner in Bangladesh had any experience in ready-made garment factory. So in the beginning, he tied the knot with the South Korean company Daeyu.
At that time, Nurul Quader sent 130 people from Desh Garments to South Korea to teach them work. Among them were workers and officials. Many of whom later became owners of garment factories themselves. As a result, it would not be an exaggeration to call the country’s garment mogul Mohammad Nurul Quader the pioneer of Bangladesh’s garment industry. Desh Garments was the proponent of everything from back to back LC, Bonded Ware House as the first garment factory in the country.
One after another garment factories have sprung up in Bangladesh following the path shown by Nurul Quader. Many of the entrepreneurs who started their journey with their own houses or rented small factories at different times in the nineties now own many garment factories. Many have started in garment factories and have become commercially successful in other sectors as well. At this stage we can talk a little bit about the success of Dulal Brothers or DBL Group.
The four brothers converted their old house into a small factory with a capital of Tk 60 lakh given by their father. Bought 36 sewing machines. For a few days in the morning and afternoon, hundreds of workers gathered at the gates of various factories in the area. Brought contract work (subcontracting) from another factory. After making the dress, the delivery is done. This went on for a couple of years. But despite their hard work, the four brothers did not see any profit in two years.
Although it was not a profit, the four brothers fell in love with two or four buyers in a few days by explaining the quality and time of the product. As a result, in 1993, they received a direct purchase order from a UK buyer. Three thousand piece polo shirts. Then the four brothers did not have to look back. They have been one of the top garment exporter industry for 29 years.
The company that started in 1991 with a small factory on 102 Green Road in Dhaka is today’s Dulal DBL Group. And those four brothers are Abdul Wahed, MA Jabbar, MA Rahim and MA Quader. They are the Chairman, Managing Director (MD), Vice Chairman and Deputy Managing Director (DMD) of DBL Group respectively.
Although it started with clothing, DBL has entered the business of ceramic tiles, information technology, telecommunication and dredging for the last 29 years. Soon they are also coming to the drug business in the country. In all, there are currently 24 DBL Group companies. 36,000 employees work in these organizations. In the 2018-19 financial year, the group’s annual turnover was about US Core 600 million, which is equivalent to Tk 5,100 crore in the domestic currency. Of this, 90 per cent came from the ready-made garment business. In all, the group has invested more than Tk 6,000 crore.
According to BGMEA, an association of ready-made garment owners, they currently have 4,621 member factories. 44 lakh workers work in these factories. A few days ago, the leaders of the organization gave this information, but now they say that last July, 1,926 garment factories.Directly garment exporter. 20-22 lakh workers work in these factories. On the other hand, the number of member factories of BKMEA, an association of net garment industry owners, is 2,263. However, the leaders of the organization have been saying for the last few months that the number of factories that directly export among the members is 636. Most of the remaining factories are closed. BKMEA cannot say the exact number of workers in the factory. As a result, there is confusion about the exact number of factories in the garment industry and the exact number of workers employed there.
Growing up with government facilities
Cheaper labor than other countries, quotas as well as government benefits i.e. duty free imports, 25 per cent cash assistance, back-to-back LCs, bondedware house facilities and the attraction of the protected market have led many entrepreneurs to venture into the garment business without prior experience. On the other hand, Sri Lanka started before Bangladesh but fell behind due to civil war in the early eighties. Then the buyers of developed countries choose Bangladesh as a good alternative. As a result, garment exports continue to grow rapidly.
The first major benefit to the garment sector was given by the HM Ershad government in 1982. The garment exporter-oriented strategy was adopted under the structural reform program directed by the World Bank and the International Monetary Fund (IMF). In this, the private sector is encouraged through contraction of the state sector and the industrial sector is given priority to the export oriented industrial sector. The Duty Draw Back (Dedo) system was introduced. It is said that even if the entrepreneurs pay duty at the time of importing the raw material, they will get it back after exporting. But due to delays and corruption, the system was discontinued and the bond facility was introduced. This opens the door for the garment owners to import raw materials for making garments duty free.