Government withdraws controversial restriction after BGMEA and BKMEA warn of disruption to export production
Bangladesh has withdrawn a controversial restriction on knit fabric imports, reversing a policy introduced only days earlier after strong objections from the country’s apparel exporters.
The decision marks a significant policy U-turn in the debate over Bangladesh’s textile backward linkage and the competitiveness of its export-oriented apparel industry.
The government abolished the provision under the Import Policy Order 2026–2029 that had made knit fabrics ineligible for import. The reversal came after the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) warned that the restriction could disrupt production, delay shipments and make it harder for exporters to meet increasingly specific international buyer requirements.
The restriction was introduced through a Commerce Ministry gazette issued on August 24. While limited provisions were made for specialised fabrics not produced domestically, exporters argued that the policy could still create difficulties in sourcing materials required for confirmed orders.
Also Read: BGBA Urges Withdrawal Of Proposed Knit Fabric Import Restrictions
The government’s original approach reflected an effort to strengthen Bangladesh’s domestic textile industry by encouraging garment manufacturers to source fabrics locally. Bangladesh has invested heavily in spinning, knitting, dyeing and finishing facilities, creating a substantial backward-linkage base.
However, exporters argued that domestic capacity does not necessarily mean every required fabric is available locally at the right quality, quantity, price and lead time.
International buyers increasingly demand specialised fabrics, customised constructions, performance materials and specific compositions for sportswear, outerwear and higher-value products. Some of these materials are either not produced in Bangladesh or are unavailable in sufficient commercial quantities.
The timing of the restriction also raised concerns. Industry representatives told the government that some exporters had already opened letters of credit for knit fabric before the gazette was published, while consignments had reached Chattogram Port or were already in transit. Any difficulty in clearing those materials could have disrupted production and shipments.
The dispute highlighted another important reality. Industry stakeholders estimate that roughly 80% of the yarn and fabric requirements of Bangladesh’s knitwear sector are sourced domestically, while around 20% is imported.
This means the debate is not simply about local versus imported fabric. Bangladesh already has substantial domestic capacity. The bigger question is whether local mills can supply every required fabric competitively, consistently and within the tight lead times demanded by global buyers.
The Bangladesh Textile Mills Association (BTMA) defended the policy direction, arguing that Bangladesh has sufficient textile capacity and that excessive reliance on imported fabric can undermine domestic investment.
Exporters, however, have pointed to another challenge – installed capacity is not necessarily the same as reliable production availability. Energy shortages, particularly gas supply disruptions, can affect textile production, while exporters with confirmed orders cannot always wait for domestic production to recover.
The government’s reversal therefore appears to reflect a balancing act between protecting domestic textile investment and preserving export competitiveness.
For exporters, the decision restores greater sourcing flexibility and reduces uncertainty over shipments already in the supply chain. It also lowers the risk of production disruptions when buyers require fabrics that are unavailable domestically.
But the reversal does not eliminate the larger policy challenge.
Rather than treating all imported knit fabrics as a threat to domestic textile production, Bangladesh could develop a more targeted approach that distinguishes between fabrics that can already be produced competitively at home and those that remain technically specialised, unavailable or insufficiently produced domestically.
Such a framework could support backward linkage while allowing exporters access to materials essential for fulfilling international orders.
The latest development is therefore more than the withdrawal of an import restriction. It highlights the need for Bangladesh’s textile and apparel industries to advance together.
For the next stage of backward-linkage development, the goal should not simply be to prevent imports. It should be to make domestic textile production so competitive in quality, innovation, price, flexibility and speed that exporters choose local sourcing because it is the best commercial option.