Let the yarn industry survive

The Bangladesh Textile Mills Association (BTMA) has raised several demands to the Government to revive the spinning and yarn industries in Bangladesh amid current vulnerabilities driven by global warfare and intense competition with peer nations. This sector constitutes an investment of about USD 25 billion, making it highly significant to the national economy. For several years, the sector has been struggling against lower yarn prices, utility deficiencies, and the cross-border import of yarn.

Their vital demands include reinstating the 30 per cent value addition requirement, augmenting cash incentives from 1.5 per cent to 5 per cent for Ready-Made Garment (RMG) exporters to emphasise the use of local yarn instead of foreign alternatives, and securing critical tax benefits. Also, revoking duties on the import of industrial raw materials is an important demand. Since utility costs are very high, most spinning mills cannot generate enough profit compared to their manufacturing costs, including the payment of government levies.

Approximately 80 per cent of our total export earnings are made by the RMG sector, which mostly depends on the yarn industry. As a deemed exporting sector, the yarn industry has to remain competitive among its peers. Although overall national exports in 2025-26 reduced by 0.58 per cent, the segment for RMG faced a de-growth of approximately 1.64 per cent, which is very alarming.

Despite having de-growth in other countries like China, India, or Vietnam, the amount is alarmingly reduced for Bangladesh in the EU market. Moreover, despite exporting a larger volume of fabrics by weight, Bangladesh earns less in export value than China. Therefore, it is urgent to give attention to the spinning sector regarding their recent demands so that the profitability of the sector can be regained, and sluggish mills can survive again. Through their survival, the country may move toward achieving its export targets in the next year.

Kawsik Azad Pronoy

A Banker and Economic Analyst

kawsikdbbl@gmail.com