The country's export has declined by more than 12 per cent in February 2026 compared to the same period in 2025. Since the dependence of overall exports is about 80 per cent on RMG, it is indeed a matter of great concern. Even the total exports from July to February have reduced by 3.73 per cent compared to the same period of the previous year.
Moreover, the carrying cost has increased due to the change of routes to Europe and the USA over the last three to four years, along with a delay of 10 to 15 days. High dependence on the EU and USA markets is alarming. Also, export diversification is now a must to sustain a healthy export trend in the future.
The margin of profit has been reduced significantly and the garments sector is suffering from a huge cashflow crisis for this reason. Even during Eid, they have to pay wages from bank loans. Recently, Bangladesh Bank issued a circular for the allotment of term loans for a maximum of one year, including a three-month grace period, for these entities to pay the salaries and wages of workers and staff.
Undoubtedly, this is a great initiative to provide breathing space to the RMG sector, but if the export trend continues to decline, the repayment of these loans will face vulnerabilities due to the cashflow crisis.
It is now necessary for banks to think about the future of the RMG sector, since approximately 12-15 per cent of overall loans are apparel-affiliated. Though many of those have recently availed policy support, strong monitoring is needed.
Kawsik Azad Pronoy
A Banker