Bangladesh has emerged as the fastest-growing apparel exporter to the United States in January 2025, achieving a remarkable 45.93% year-on-year growth, according to the latest data published by the Office of Textiles and Apparel (Otexa) and compiled by the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

As per the data, US imports of Bangladeshi apparel reached $799.65 million in January 2025, a significant jump from $547.95 million in the same month of 2024. This growth rate outpaced all other major suppliers, including Indonesia (41.70%), India (33.64%), and Vietnam (19.90%).

The overall US apparel import market grew by 19.46% year-on-year to $7.2 billion during the same period. 

The rise in exports from countries like Indonesia, India, and Cambodia suggests a diversification of sourcing by US buyers, possibly influenced by competitive costs and geopolitical considerations.

Meanwhile, China’s slower growth and Honduras’s sharp decline indicate shifting dynamics in global sourcing patterns. Factors such as trade policies, production costs, and sustainability requirements continue to shape these trends.

Despite global economic challenges, Bangladesh’s competitive pricing, enhanced production capabilities, and commitment to sustainable and ethical manufacturing practices have likely contributed to this robust growth in January.

Industry insiders opined that the diversification of sourcing by US retailers, coupled with Bangladesh’s ongoing efforts to enhance factory compliance and sustainability, has strengthened its position in the global apparel supply chain.

Talking to The Business Standard, Mohiuddin Rubel, a former director of BGMEA, said, “As Bangladesh continues to invest in sustainability and innovation, the country’s apparel sector is poised for continued growth.”

He also emphasised the need to diversify product offerings to sustain this momentum.

Among the other major exporting countries, China has maintained its position relative to the US, with apparel exports rising by 13.72% to $1.6 billion from $1.41 billion in January 2024. While the growth is steady, it’s relatively lower compared to some emerging competitors.

Vietnam also recorded a 19.90% increase in exports, reaching $1.44 billion, showcasing its sustained competitiveness in the US market. 

Indonesia has achieved an impressive growth of 41.70%, with exports rising from $296.36 million to $419.95 million, positioning it among the fastest-growing exporters.

India exported $473.27 million worth of apparel, marking a 33.64% year-on-year growth, while Cambodia posted a strong growth of 29.95%, with exports rising to $324.99 million.

Mexico saw marginal growth of 1.26%, indicating relatively stagnant performance compared to others.

However, Honduras has faced a sharp decline, with exports falling by 26.10% to $112.02 million, highlighting competitive pressures or supply challenges.

Faruque Hassan, a former BGMEA president, said American buyers are placing more orders in Bangladesh, as reflected in recent import data.

He explained that US imports recorded in January indicate that goods were shipped prior to that month, likely in late November or December last year.

He also expressed optimism that the US market will improve in the coming months, with an increase in global sourcing.

He also pointed out that some orders are shifting from China to Bangladesh due to an additional 10% duty imposed by the Trump administration on Chinese exports to the US from last month.

Furthermore, additional tariff measures were to be imposed on US imports from China and Mexico starting from 4 March. 

Under the new regulations, Chinese exports to the US will face an additional 10% duty, while Mexican exports will be subjected to a 25% duty.

Previously, Mexican exports benefited from zero duty under the North American Free Trade Agreement (NAFTA).

China has also imposed a 15% duty on US cotton imports. 

Faruque highlighted that this measure will benefit Bangladeshi spinning and textile millers by enabling them to purchase cotton at more competitive prices.

To capitalise on these opportunities, he said the government must address four major issues: ensuring an uninterrupted supply of gas and electricity, reducing prices, improving customs services, and strengthening law and order management.

The former BGMEA president added that attracting new investment and securing orders for Bangladesh depends on maintaining law and order, which remains a top priority. “The government should take immediate steps to stabilise the situation.”

Concerns have arisen regarding salary and bonus payments for 21,483 garment workers across 44 factories in Chattogram, ahead of the Eid holiday, according to intelligence reports. 

Of the factories, six are at greater risk of worker unrest, the reports state.

Mohammad Solaiman, superintendent of Chattogram Industrial Police, told TBS, “Before every Eid, we make a list of vulnerable garments and other factories where there is a possibility of labour unrest due to non-payment of salaries and bonuses.

The intelligence reports mention that financial pressures, stemming from dwindling work orders, shipment delays, and outstanding payments, have left many workers uncertain ahead of Eid-ul-Fitr, which is likely to be celebrated on 1 April.

The vulnerable factories include eight in the Kalurghat BSCIC industrial area, six in CEPZ, six in Double Mooring, five in Pahartali, three in KEPZ, three in Bayezid, two in Halishahar, two in Akbar Shah, two in the Khulshi-Nasirabad industrial area, two in Chaktai, and one each in Karnaphuli, Boalkhali, Patiya, Hathazari, and Panchlaish.

Among the vulnerable workers, 14,833 are women, and 6,650 are men.

However, the Industrial Police and leaders of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) have assured that they are monitoring the situation and keeping in contact with the owners of the vulnerable factories to resolve the financial crisis and prevent potential unrest.

Solaiman said, “Once the list is prepared, we appoint officers to communicate with the factory owners and learn about their financial crisis. They not only maintain contact but also negotiate with the entrepreneurs to resolve the crisis. By the end of Ramadan, problems are typically resolved in most factories.”

The Chattogram Industrial Police super said last year, there were 37 vulnerable factories and labour unrest occurred in two of them. “This year, the number has increased to 44. We have already started negotiating and following up with the vulnerable factories. We hope that we will be able to resolve the crisis in most of the factories this year as well.”

Explaining the difficult situation, Belayet Hossain, former director of BGMEA, said on average, 10-15 factories face financial crises every month.

He said, “The number increases during Ramadan. This year, the situation is even more challenging due to the timing of Eid. After making payments for February’s salary, factory owners will have to pay the Eid bonus. Then, they will face pressure to pay an advance on March’s salary. This will be very tough for most factory owners.”

There is a dedicated wing in the BGMEA assigned to monitor vulnerable factories and help them resolve the crisis, Belayet said, adding that the wing has already held a meeting with stakeholders and is working tirelessly.

Md M Mohiuddin Chowdhury, a member of the BGMEA administrative committee and director of Clifton Fashion Ltd, said, “After a change in the political landscape, some labour movements had a negative impact on the country’s reputation. Additionally, the labour unrest in Dhaka disturbed some buyers.

“However, new orders are now coming in, though not everyone has received them yet, leaving some factory owners in a difficult situation.”

Mohiuddin emphasised that factory owners never want to delay salary and bonus payments. “Their priority is to clear dues and allow workers to enjoy their Eid holidays. We are aware of the situation in some factories and are maintaining regular communication with them to prevent worker unrest.”

India’s textile and clothing exports may increase by US $ 6 billion in three years under a planned zero-for-zero trade agreement with the US, levelling the playing field.

After China and Vietnam, India is the US’s third-largest supplier of clothing and textiles.  Between January and November 2024, the United States accounted for 28.5 per cent of India’s total exports of textiles and clothing. India imported just US $ 0.41 billion worth of goods from the US in FY24, compared to US $ 10.8 billion in exports.

Over the past five years, US imports from China have decreased at a compound annual growth rate (CAGR) of 9.4 per cent, whilst imports from India have increased at a CAGR of 9.1 per cent, indicating a window of opportunity for India to improve its standing in the US market.

While US companies have partially shifted away from China, Vietnam and Bangladesh have profited the most from the recent trade tensions, as their share has climbed by 7.8 per cent and 3 per cent, respectively. Bangladesh and Vietnam both benefit from tariff exemptions and favourable trade agreements with the United States for textiles.

According to the Confederation of Indian Textile Industries (CITI), by generating an additional US $ 6 billion in revenue over the next three years, India’s textile and apparel exports to the US may reach US $ 16 billion.

It stated that in order to achieve this, India should look into a zero-for-zero trade agreement with the US for textile and clothing goods, with the required protections for delicate goods. Indian exporters would have an even playing field against Bangladesh and Vietnam under a zero-duty regime.  It stated that a duty-free access mechanism with quota controls could guarantee a balanced trade strategy because India is still reliant on US cotton imports.