Textile entrepreneurs to invest $2.5 billion by 2023
The country's textile factory owners are set to invest $2.5 billion in the sector by 2023 to boost production capacity to meet growing demand.
The investments will mostly go into adopting new technologies. The fresh injection is also expected to generate employment opportunities for about one lakh people at 25 units, Bangladesh Textile Mills Association (BTMA) President Mohammad Ali Khokon told the media yesterday.
The investments come in the form of establishment of 13 new textile units and expansion of 12 others to meet the growing demand, mostly of manmade fibre, in the international market, industry insiders say.
The textile sector lags behind in the production of blended yarn and fabrics like polyester, synthetic, viscose and lycra (known as man-made fibre) and the investment is expected to correct that.
There will be 2.5 million newly-installed spindles, adding to the existing capacity of about 13 million spindles.
Khokon said the new units had already opened letters of credit to import capital machinery, and all are scheduled to come into production by 2023.
The BTMA president also said the recent gas and electricity crisis in China created a scope for the local weaving industry to expand.
To utilise the new capacity, about 2.5 million bales of raw cotton need to be exported each year. Bangladesh imported 8.2 million bales in 2020-21, he added.
The weakening pandemic in Europe and the United States – two major destinations of Bangladeshi apparels – has meant the demand for readymade garments is returning to the pre-Covid level, industry insiders said.
Many textile manufacturers are now overwhelmed with export orders, which they will not be able to meet on time by using their current capacity, sources said.
Besides, trade tensions between the US and China have also encouraged local entrepreneurs to invest in some value-added yarn and fabrics.
The latest investment is to come from Modern Syntex, Abul Kalam Spinning Mills, Universal Denim, Karim Tex, Nice Spinning, Mondol Spinning, Chandrsee Spinning, NR Spinning, Wazeed Spinning Mills, Raw Tech, Beximco Group, RBD Fibers and Sufiya Cotton Textiles.
Karim Group is investing Tk1,350 crore to produce 112 tonnes of yarn in a day – 80 tonnes of natural yarn and 32 tonnes of synthetic yarn – to meet the growing demand of yarn, said Md Wahid Mia, managing director of Karim Tex Ltd.
The new unit will be the largest spinning mill with the latest technology, which is scheduled for commercial production by 2023, he added.
Wahid said it will create employment for around 1,000 people.
Meanwhile, Chandsree Spinning Ltd, a new venture in the textile sector, is investing Tk100 crore to produce about 28.80 lakh tonnes of yarn annually, said its managing director ABM Jafar Ahmed.
On the other hand, Asia Composite, Maksons Group, Envoy Group, New Asia Group, DBL Group, Pride Group, ShaSha Group, among others, are also investing to expand their capacity.
Of the investors, Asia Composite has plans to install another 48,000 spindles, along with the current 70,000 spindles.
Envoy Group is also investing Tk125 crore to set up a synthetic blended yarn production capacity. The new unit will produce 12 tonnes of yarn per day.
Kutubuddin Ahmed, chairman of the group, said, "We are enhancing spinning capacity to produce cotton and synthetic blended 'expanded yarn' as a substitute for imported yarn."
According to the BTMA, more than 433 spinning mills were in operation in Bangladesh in 2020, which had a combined production capacity of 3,270 million kilogrammes of yarn per year.
Local spinners can supply nearly 85-90% of the required yarn and fabrics for knitwear.
In the case of woven fabrics, local weavers can supply below 40% of the requirement. Because of this, the woven garment industry has remained dependent on foreign fabrics, according to BTMA data.
Of all garment items produced globally, 78% is made from manmade fibres, while cotton fibre accounts for the rest, according to data from the International Textile Manufacturers Federation (ITMF) – a Switzerland-based platform for global textile makers.