Finance Minister Nirmala Sitharaman highlighted Bharat’s garment and knitted fabric industries are encountering “a bit of uncertainty” due to the ongoing crisis in Bangladesh.
Sitharaman revealed that significant investments from Indian textile companies, particularly from Tamil Nadu, had been made in Bangladesh in good faith, which previously led to increased exports from the region. However, the current instability is causing concerns over the safety of these investments and potential disruptions in production.
The Indian finance minister noted that while it is too early to gauge the broader economic impact of Bangladesh’s turmoil on Bharat, the immediate challenges for Indian textile companies in Bangladesh’s ready-made garment sector are evident.
Despite Bangladesh’s ready-made garment sector being a major export driver, accounting for 84.6 per cent of its total exports in 2022-23, it represents only 3.35 per cent of Bharat’s total outbound shipments in FY24.
Commerce ministry data shows that Bharat’s overall textile exports fell by 3.23 per cent year-on-year to $34.40 billion in FY24. Indian exports to Bangladesh, which include textiles along with other categories such as machinery and electronics, may face short-term disruptions.
Sitharaman expressed hope that the interim government in Bangladesh, led by Nobel laureate Muhammad Yunus since August 8, will quickly restore stability, allowing normalcy to return to the garment sector and safeguarding ongoing investments.
