Bangladesh has the opening for fresh investment in woven fabrics production. Currently, local spinners can supply 85 per cent of the raw materials to the export-oriented knitwear sector and 35 per cent to 40 per cent to the woven sector.
There is scope for investments in the primary textile sector over the next five years as demand for locally made fabrics has been rising in both domestic and international markets. Bangladesh garment makers use 12 billion meters of fabrics a year for making export-oriented garment items. Of the quantity, domestic weavers can supply three billion meters of fabrics, with the rest imported from India and China.
If local weavers can supply 60 per cent of the requirement for woven fabrics in the next five years, that will reduce the dependence on imports. In the last one year, entrepreneurs set up 19 spinning mills, 23 fabrics mills and two dyeing printing mills. The main impediments for the sector are land and energy. Supply of energy and industrial land at a reasonable price can encourage spinners and weavers to invest in the sector.
The listed textile mills have been unable to give dividends for years mainly due to higher bank interest rate, high energy prices and other operational costs.