Apparel makers in Chattogram are hailing the revised US counter-tariff policy as a potential game-changer for Bangladesh’s export economy, urging the government to act swiftly to unlock the full benefits of a shifting global trade landscape.
Following diplomatic efforts by the interim government, the United States has reduced Bangladesh’s supplementary counter-tariff from 35 per cent to 20 per cent, a move that levels the playing field with key competitors and even gives Dhaka a strategic edge over nations like India (25 per cent) and China (40 per cent).
Now, Chattogram’s factory owners say the country stands at a historic crossroads – one where tariff disparities can be transformed into export growth, job creation, and economic transformation.
A New competitive edge
Under the updated US trade policy: China and Myanmar face 40 per cent reciprocal tariff, India faces 25 per cent, Sri Lanka and Vietnam face 20 per cent, Pakistan and Indonesia face 19 per cent, and Bangladesh now faces 20 per cent.
While slightly higher than Pakistan and Indonesia, Bangladesh’s rate is now significantly lower than India and China, two of its biggest rivals in the global apparel market.
“This is not just relief – it’s an opportunity,” said SM Abu Tayyab, elected BGMEA director from Chattogram and Managing Director of Independent Apparels Limited. “Buyers are already shifting. They’re coming to us because their costs in China and India have skyrocketed. We must be ready to absorb this wave.”
Orders on the move, but obstacles remain
Tayyab revealed that Chattogram-based factories have already started receiving Free of Cost (FOC) purchase orders – where foreign buyers supply raw materials and accessories, and Bangladeshi factories handle production and export.
“Many orders previously placed in China and India are now being redirected here,” he said. “But the problem is not demand – it’s our internal bottlenecks.”
He pointed to port delays, complex customs procedures, and inconsistent regulatory enforcement as major hurdles. “We can produce quality garments, but if the system slows us down, we’ll lose the trust of global buyers.”
A call for FOC-friendly policies
Rakibul Alam Chowdhury, another BGMEA Chattogram director and MD of HKC Apparels Limited, stressed the need for policy modernisation, particularly around FOC operations.
“If the National Board of Revenue (NBR) introduces a bonded FOC regime – where materials enter duty-free and are tracked digitally – it would revolutionise our competitiveness,” he said. “This is essential if we are serious about reaching the government’s $100 billion export target.”
Chowdhury also highlighted a looming labour challenge: “If we win these new orders, we’ll need hundreds of thousands more workers. The government must invest in skills training and worker housing – this isn’t just industry growth, it’s national development.”
With around 250 RMG factories in the port city directly exporting to the US, Chattogram is poised to become a central player in Bangladesh’s export resurgence.
Sakif Ahmed Salam, Deputy Managing Director of Asian Group and BGMEA director, emphasised the potential for value addition.
“Vietnam and India dominate high-end, high-FOB-value segments,” he said. “We can compete there –but only if the government supports long-term investments in automation, digital design, and sustainable technologies. Low-interest financing and tax incentives for innovation are critical.”
He added, “This US tariff shift isn’t just about replacing China. It’s about moving up the value chain –from basic garments to premium, tech-integrated apparel.”
Export numbers tell the story
According to the Ministry of Commerce, Bangladesh earned $48.28 billion in exports during FY 2024–25, with $8.69 billion, nearly 18 per cent, going to the United States. RMG remains the largest export sector, and the US is its single biggest market.
Now, with tariffs realigned, Chattogram’s exporters see a clear path forward: leverage the moment, fix the system, and scale fast.
As global buyers scout for alternatives to high-tariff nations, Bangladesh, especially Chattogram, is emerging as a viable, cost-effective destination.
But industry leaders agree: the window of opportunity is narrow.
“The US tariff has given us a chance,” said Tayyab. “Now, it’s up to the government and the industry to make sure we don’t waste it. If we act together, ‘Made in Bangladesh’ can become a global premium brand.”
With the right policies, Chattogram may not just be a garment city, it could become the next powerhouse of South Asian manufacturing.