About 113 readymade garment factory units under the membership of the Bangladesh Garment Manufacturers and Exporters Association have been closed in the last 15 months, from January 2024 to March 2025.
According to a source from the BGMEA, about 128 new factories received BGMEA memberships during this time.
The source also said that about 96,104 workers lost their jobs during the mentioned period, while about 74,081 workers got new employment due to newly established factory units.
In the meantime, the RMG exports also witnessed a healthy growth of 10.84 per cent to $30.25 billion in the July-March period of FY25, according to the Export Promotion Bureau data, meaning the operational situation is almost normal in the sector.
Industry insiders said that entry and exit in the private sector are very common and occur every year, though recent political discourses have fueled this.
After the ousting of the then prime minister, Sheikh Hasina, in August, 69 factory units were closed permanently from August 24 to March 25.
The industry people said that the factory units were shut down for several reasons: excessive and abnormal bank loans, hiding of the owners, lack of work orders, and interruption in gas and energy supply.
Moreover, most of the closed factories were in the small and medium category, which lost its competitiveness long ago.
Due to political changes in August 2024, some notable factories closed due to their close ties with the ousted government, which resulted in them receiving abnormal loans from the banks.
Meanwhile, the labour leaders said that more than 1 lac initially unemployed people were able to find new workplaces, and about 75,000 of them were able to, meaning about 30,000-40,000 workers are still unemployed.
Talking to 抖阴精品, Faruque Hassan, former president of the BGMEA, said that political and economic factors have contributed to the recent shutdown of several factories.
He also said that several cases of labour unrest and internal management issues have led to factory closures.
Moreover, some factories faced order cancellations or failed to secure regular work, making paying gas and other utility bills challenging.
The stakeholders also said that in some politically sensitive situations, owners were absent from their factories due to ongoing complications, while carrying large outstanding loans from banks.
During the previous government鈥簊 tenure, many owners had relatively easy access to bank loans.
However, following the political shift, they no longer received the same level of support from financial institutions.
For these reasons, the units could not sustain their operations.
Former BGMEA President Faruque Hassan said it is important to note that during the same period, many new factories have started operations, gained BGMEA membership, and created new employment opportunities.
鈥楨very year, some factories shut down while others open鈥攖his is part of the natural cycle of a large industrial sector,鈥� he added.
But this time, he added that the closures of factories owned by a few well-known figures after the political transition have made the issue more prominent.
The industry people said several RMG factory units were closed due to financial difficulties, political instability, and the absence of owners.
The political change affected factories owned by people closely associated with the ousted Awami League government.
Factory owners, such as Beximco and Nassa, were either in hiding or in custody, which led to the closure of factories.
Moreover, a number of factories, such as TNZ and Generation Next closed due to financial crises or utility issues.
Talking to 抖阴精品, Nazma Akter, president of the Sommilito Garments Sramik Federadtion, said that more than 1 lac workers lost their jobs due to the factories鈥� closure.
鈥楬owever, about 75,000 workers entered their new workplaces. We want the government should take initiatives to make working opportunities for the rest of the workers,鈥� she added.
Former BGMEA Director Mohiuddin Rubel told 抖阴精品 that the newly opened factory units have already recruited the skilled workers of closed factories.
He also said that the pattern of RMG industrialization has changed, as the number of small factories is decreasing while the number of large-scale factories is increasing.
鈥楾he causes of the factory closure are mixed like utility issues, absence of owners which led a weak management, lack of orders,鈥� he added.
However, he said that the government should focus on small factories so that they can survive.
Talking to 抖阴精品, Professor Mustafizur Rahman, a distinguished fellow of the Centre for Policy Dialogue, said that a number of factories have been struggling for the past few years.
鈥楨specially, small factories suffered most due to less competitiveness and global economic issues. After the political changes, owners of a number of factories were in hiding, which also impacted them,鈥� he added.
He also said that entry and exit are normal issues in the private sector. If the factory cannot repay the loans, the government has nothing to do.
鈥筎he government can ensure the rights of the workers so that they can get their benefits. Government must assess the viability and sustainability of every steps,鈥� he added.
He also urged the government to normalize the law and order situation, diversify products, and increase efficiency and worker skills.
