Late last year, a report by New York University’s Stern Centre for Business and Human Rights on Bangladesh’s RMG industry highlighted certain issues regarding the safety of workers and their income.It was, inevitably, contested by the BGMEA, the industry’s owner’s association.This is a topic that deserves to be analysed and probed with the necessary insight, as it is the RMG industry which has firmly secured Bangladesh’s place in the global arena, the collapse of Rana Plaza in 2013 notwithstanding.The report presented information on the size and composition of our RMG industry as a census.It was reported in the press that the total number of units was 7,000, of which 3,200 were engaged directly in export and the other 3,800 linked as sub-contractors and others.The BGMEA contested that the report included many smaller tailoring units, with two to three workers across the country producing garments for local consumers.In total, 5.6 million workers are engaged against four million in exporting units. It also has backward linkages with manufacturers of fabrics (denim) and accessories. The BGMEA claimed that they were not responsible for the safety of the units which were not being exported.RMG is a sizeable industry for a developing nation such as ours, and that is exactly why the global response to the Rana Plaza collapse — a disaster that claimed the lives of more than 1,200 workers and injuring countless others — was so massive.In response, two groups of buyers formed alliances to help improve the state of safety in RMG factories and compensation schemes were launched for the victims. The New York Times did extensive coverage of the disaster, and also published a rather excellent research-based report written by Adam Davidson.The paper highlighted that most rich countries have gone through a “T-shirt phase,” that they come out of it with a stronger economy, but also that things are a little more complicated in Bangladesh.On that last point, the researchers concluded in favour of the strategic strengths of RMG production in Bangladesh: “The country’s manufacturers can afford to take a step or two up the value chain.Not only can they pay their workers more, treat them better, and house them in safe and clean factories, but there is also a significant economic incentive to do so.”Apropos of that positive spin on the future of the industry, it is imperative that we try to improve its overall conditions, not only of those who are exporting directly. That so many small tailoring units are supplying garments to local buyers — despite significant leakage of RMG products in domestic markets, as one can find on the streets these days, is a small-scale miracle.One of the issues that I myself have worked towards is to devise a “livelihood insurance scheme” with American Insurance Group’s (AIG) Bangladesh branch, following suggestions in the book New Financial Order by RJ Shiller, Nobel prize winner in Economics.AIG did not want to take up such a commercial risk, but it can be taken up under certain schemes of social insurance supported by all stakeholders. As a financial innovation, insurance products can be made available to millions for the loss of income on the part of the workers. AIG’s Dhaka office estimated a premium for the life-time income loss and it was a very small amount per head.Instead of excluding the non-exporting units from the coverage of compliances, the BGMEA should expand its horizons and work on the recommendations of the current report and the one mentioned above from the New York Times. Our RMG industry can compete with rest of the world. It has already moved up to higher value-added products.Retailers from abroad have done a good job by stepping up, but they can also offer slightly higher prices in their markets and insist that workers’ wages and benefits are protected through the surplus revenue.
