Introduction: From Quiet Foundations to Global Prominence
Although Bangladesh’s readymade garments (RMG) industry had its quiet beginnings prior to the 1980s (as discussed in our previous article), the decades that followed witnessed a striking metamorphosis. From a nation grappling with industrial identity and economic constraints, Bangladesh emerged as the second-largest exporter of RMG products in the world, trailing only behind China.
This evolution did not occur by chance. Rather, it was the outcome of bold policy reforms, favourable global trade conditions, entrepreneurial tenacity, and a significant shift in labour demographics. In this article, we explore the factors that spurred Bangladesh’s RMG boom after the 1980s, examining how a struggling economy turned into a key player on the global fashion map.
1. The Daewoo-Desh Breakthrough: A Korean Catalyst
In 1978, a historic joint venture was struck between Desh Garments, a Bangladeshi firm, and Daewoo Corporation of South Korea. At a time when the RMG industry in Bangladesh was nascent, this partnership proved transformative. Over 130 Bangladeshi employees were sent to South Korea for training in cutting-edge garment production, quality assurance, and factory operations.
Upon returning home, these individuals became pivotal players—many established their own factories or became senior managers, injecting modern industrial discipline into a budding sector. Unlike donor-driven initiatives that often failed to scale, the Daewoo model was commercially viable, export-oriented, and deeply impactful.
Key Impacts:
- Development of a technically proficient workforce
- Introduction of global best practices and compliance awareness
- Spread of knowledge through domestic entrepreneurship
2. The Multi-Fibre Arrangement (MFA): A Strategic Window
The Multi-Fibre Arrangement (MFA), operative from 1974 to 2004, inadvertently opened doors for Bangladesh. Under this quota regime, developed nations such as the United States and members of the European Union capped imports of textiles from dominant players like China and India.
Global apparel buyers began seeking alternative sourcing destinations, and Bangladesh—with its low-cost labour and untapped capacity—stepped in to fill the void. Despite minimal automation, the country could churn out large volumes of basic garments—t-shirts, trousers, and shirts—at highly competitive prices.
Key Outcomes:
- Massive growth in export volumes
- Entry of major international brands including H&M, Walmart, and Carrefour
- Emergence of hundreds of new garment factories
3. Private Sector Risk-Takers and Pioneers
The RMG industry was not shaped by industrialists in the conventional sense. Instead, it was enterprising traders, returning expatriates, and self-taught entrepreneurs who took the initial leap. Figures such as Nurool Quader Khan (Desh Garments) and Annisul Huq (Mohammadi Group) led the way, setting up factories with limited capital and immense personal risk.
Their formula was simple yet effective: lease a modest floor, hire and train a workforce, import second-hand machinery, and forge relationships with international buyers. This agility enabled exponential growth, laying the foundation for many of today’s garment conglomerates.
Why This Approach Succeeded:
- Strong use of diaspora and informal global connections
- Adaptability and rapid scaling capabilities
- Profit reinvestment focused on growth rather than luxury
4. The Role of Women: Redefining Social Norms
By the mid-1980s, women constituted over 75% of the RMG workforce—a seismic shift in a traditionally patriarchal society. Often hailing from rural villages with little to no formal education, these women were trained to operate machinery, sew garments, and manage quality control.
For many, this was their first experience with formal employment and independent income. While factory conditions were initially poor, the social implications were transformative. Delayed marriages, reduced birth rates, and increased participation in civic life became increasingly visible.
Key Social Changes:
- Emergence of dual-income families
- Enhanced mobility and autonomy for women
- Gradual shift in societal attitudes towards female employment
5. Government Policies that Enabled Industrial Take-Off
Policy support played a decisive role in creating an enabling environment for RMG growth. Throughout the 1980s and 1990s, successive governments implemented reforms to promote exports and attract private investment.
Notable Measures Included:
- Bonded warehouses for duty-free import of raw materials
- Back-to-back letters of credit, making it easier for small factories to procure inputs
- Establishment of Export Processing Zones (EPZs) in Dhaka and Chattogram with tax holidays and streamlined customs
- Cash incentives and tax rebates for export-oriented units
These measures significantly lowered the entry barriers, particularly in RMG hubs such as Gazipur, Narayanganj, and Chattogram.
6. Building Backward Linkages: The Rise of Local Supply Chains
Initially, Bangladesh’s apparel sector was almost entirely dependent on imported fabric and accessories. Over time, however, the industry developed robust backward linkages. Local companies began investing in spinning, dyeing, weaving, and accessory production.
By the early 2000s, Bangladesh had become self-sufficient in knitwear production, drastically reducing lead times and boosting competitiveness. Leading firms such as Zaber & Zubair, Envoy Textiles, and DBL Group now cater to both local and international buyers.
Key Benefits:
- Reduced reliance on imports
- Improved control over production schedules
- Greater value addition retained within the national economy
7. Global Compliance, Tragedy, and Reform
Despite its economic success, the sector also drew global scrutiny over labour conditions and safety standards. Catastrophic incidents like the Tazreen factory fire (2012) and the Rana Plaza collapse (2013) led to international outrage and exposed systemic negligence.
These tragedies acted as catalysts for comprehensive reform. Two major initiatives—the Accord on Fire and Building Safety (EU-led) and the Alliance for Bangladesh Worker Safety (US-led)—oversaw widespread audits, safety upgrades, and worker training programmes.
Notable Reforms:
- Closure of over 2,000 unsafe factories
- Construction of fire exits, earthquake-resistant structures, and emergency plans
- Bangladesh now boasts the highest number of LEED-certified green factories in the world
8. COVID-19 and the New Era of Sustainability
The COVID-19 pandemic brought severe disruptions to the RMG sector. Order cancellations, supply chain breakdowns, and factory closures led to massive job losses. However, it also marked a pivot point.
Many firms began rethinking their business models, focusing on sustainability, automation, and digital transformation. ERP systems, lean manufacturing, and health-conscious working environments became the new norm. Additionally, an increasing number of green factories—including those of EPIC Group and Remi Holdings—cemented Bangladesh’s position as not just a low-cost supplier, but a responsible and sustainable manufacturer.
9. Current Landscape: Bangladesh on the Global Stage
As of 2024, Bangladesh exports garments to over 160 countries, with the European Union accounting for more than 50% of total shipments. Other major markets include the United States, Canada, Japan, and Australia.
Moreover, Bangladesh has diversified into high-value segments, such as outerwear, jackets, lingerie, and sportswear, traditionally dominated by Turkey and Vietnam. Local firms are investing in design, branding, and technology to enhance their global competitiveness.
Current Industry Snapshot:
- Contributes 84% of national export earnings
- Employs over 4 million people, the majority being women
- Boasts over 150 LEED-certified green garment factories
Conclusion: From Fragility to Global Strength
Bangladesh’s rise in the global garments industry stands as a compelling tale of transformation in the Global South. From an aid-dependent nation with limited industrial heritage to a thriving export-driven economy, this journey underscores the power of visionary entrepreneurship, policy pragmatism, and an industrious workforce.
While the global market may see only price tags and fashion labels, every stitch sewn in Bangladesh tells a story of resilience, adaptation, and progress. The industry has weathered challenges, overcome reputational crises, and emerged stronger and more agile.
As Bangladesh sets its sights on reaching $100 billion in RMG exports by 2030, it must continue to evolve—by investing in human capital, embracing innovation, and ensuring social and environmental responsibility. The modern revival of Bangladesh’s RMG sector is not merely about garments—it is a powerful symbol of national ambition and global relevance.
