Bangladesh's political crisis has severely disrupted its textile sector, presenting challenges that could benefit neighboring India. According to a report by Primus Research, even a modest business transfer of 10-11 percent to India could add USD 300-400 million in monthly business for Indian textile players.
The Bangladeshi textile sector, which constitutes 80 percent of its exports and contributes 15 percent to its GDP, has been particularly hit in the ready-made garments (RMG) sector.
Recent challenges including supply chain disruptions, curfews, and internet blackouts have severely harmed the industry. These setbacks are expected to lead to a 15-20 percent decline in RMG exports from Bangladesh, causing widespread concerns among global buyers and leading to market shortages and increased uncertainty.
Bangladesh's monthly apparel exports, valued between USD 3.5-3.8 billion, dominate the markets in the European Union, United Kingdom, and United States. Meanwhile, India's monthly exports range from USD 1.3-1.5 billion.
This crisis provides India with a golden opportunity to capture a larger share of the global textile market. To fully leverage this situation, India must adopt a strategic, proactive approach, including modernizing textile manufacturing facilities, improving logistics, and ensuring a steady supply of raw materials to meet the rising demand.
Enhancing policy support by offering incentives for both domestic and foreign investors, streamlining regulatory processes, and reducing bureaucratic hurdles will also be crucial for the industry's growth. Several Indian companies operating in Bangladesh are considering relocating their operations back to India. Notably, textile hubs like Tirupur, known for robust manufacturing infrastructure, are experiencing a surge in orders, with stocks of Indian textile manufacturers rising by over 10 percent driven by expectations of capturing a larger market share.
Securing favourable trade agreements, particularly with key markets in the UK and EU, will be essential for expanding market access. By focusing on innovation and expanding its reach, India can reclaim its position as a global leader in the textile industry. Indian textile companies stand to gain significantly from diverted orders, strengthening their presence internationally.
—Devdiscourse
