Hiren Pandit

We need to facilitate more exports to countries in Latin America, Africa, Asia, and the Middle East besides the European Union and the United States. Authorities should identify the benefits of signing free trade agreements or preferential trade agreements without considering only potential revenue gains.

Bangladesh earns $1 billion from the jute sector, but considering increasing international commitments to global climate change and sustainable development, the industry could grow from $5 billion to $10 billion. Relevant agencies should implement domestic regulations, and WTO-approved industry preparedness is very important. Also, the Bangladesh Standards and Testing Institute (BSTI) should be strengthened to ensure the quality of local products and better-quality control of those exposed to international standards.

Diversifying the country's exports will help meet existing and new challenges after the LDC transition in 2026. Bangladesh has depended on almost one sector for its export earnings for years. No one knows when the 84 percent share of readymade garments in exports will come down with healthy growth in other industries and manufacturing components. Leather and footwear, pharmaceuticals, ceramics, IT and software, jute products, light engineering products, additive manufacturing, handicrafts, frozen food, agro-based items, and others have been identified as sectors that can increase Bangladesh's foreign exchange earnings.

The country's legal capacity must also be enhanced as trade disputes may increase significantly during the LDC transition phase. Small and medium industries like jute, agro-processing, leather products, footwear, pharmaceuticals, light engineering, ICT, and other emerging sectors have to face all kinds of competition to compete in the international export market. Traditional industries, as well as geographic diversification and service sectors. Jute is now used in various products and has become the world's second most sought-after natural fiber. We need to add value to this sector to be competitive.

About 70 percent of Bangladesh's total arable land is used for rice production, which employs about 45 percent of the country's rural labor force. We must increase technology adaptation, private sector research and innovation, good agricultural practices, and the country's post-harvest capacity and brand. Bangladesh needs to achieve an investment climate. We love to receive compliments from foreigners when they appreciate our social sector progress and national ambition to become a middle-income country without extreme poverty by 2031 and a developed nation by 2041.

Businessmen should focus on research for product diversification and their branding in the field. They should also export and trade. By maintaining the quality of the product, the traders can maintain the market and improve. We need to build our branding and move forward. We need more business research. Industry owners and entrepreneurs in every business venture protect the image of their country by determining product demand and quality standards and maintaining product quality standards for export.

The ready-made garments sector, or RMG sector, is a successful model for export in Bangladesh, but now it is time to focus on other potential sectors like leather, textile, pharmaceuticals, ICT, and light engineering. Bangladesh has started formulating long-term plans to increase the scope of its exports after transitioning from the United Nations Least Developed Countries (LDCs) status. These include ensuring low cost and easy access, adequate policy support, as well as financial and non-financial incentives for the non-apparel export sector, and equitable skill development. We should focus more on non-apparel sectors with good export potential.

The age of technology is advancing very fast worldwide. Before the Fourth Industrial Revolution, we took steps to create skilled human resources. We managed to keep everything going during the COVID period when many countries worldwide faced problems. The government has achieved good growth in the past and is expected to do better in the future. Bangladesh has completed a feasibility study on 23 countries to implement bilateral and regional trade agreements, free trade agreements, and integrated economic agreements to facilitate trade.

In other words, as a developing country, we are working with particular attention to face any challenges that may come our way. Entrepreneurs in other potential non-garment sectors must diversify their products and find new markets to increase their export earnings. It is essential to diversify textile products to align with the global market. The same thing may not always be preferred. The design of the clothes, the color, everything has to be changed. Bangladesh has a good position in the world clothing market. However, only 8.40 percent share of the world market.

So, we need to focus on this. We must work hard to increase product demand in the global market. Short, medium, and long-term plans should be formulated to achieve this goal. The private sector is at the forefront of the development and growth of the apparel industry, especially in expanding international markets. Therefore, private companies should come forward to diversify exports. Thailand, a successful example of export diversification, has adopted a dual strategy of upgrading natural resource-based industries (such as agriculture and fishery products) and promoting labor-intensive manufactured exports, mainly apparel and electronics.

All East Asian economies, including China, have benefited from the rise of regional economic integration due to the integration of production chain locations through the integration of cross-country production networks as multinational companies seek low-cost production facilities across national borders and capitalize on supportive local policy initiatives. Globally, the World Economic Forum's Enabling Trade Index and the World Bank's Trade Logistics Performance Index (LPI) are two commonly used indices.

Bangladesh has a comparative advantage in all sectors but faces obstacles such as skill shortages, the need to upgrade technology, poor infrastructure, or difficulties in meeting international standards and compliance. Bangladesh scores poorly on most indicators included in the index but scores particularly low on transport and electricity, which have emerged as serious bottlenecks in the manufacturing sector. It is argued that low-wage unskilled labor moves from one place to another depending on availability. It is never good for a country to be dependent on any one source for its exports. Competition is a global practice, and we should remember this.

For Bangladesh's economic development and sustainable growth, export products should be diversified. If this can be done, the dependence on one product will be reduced on the one hand, and the total export income will increase on the other hand. Employment will increase. Women will also benefit. According to the report, 1600 products are exported from Bangladesh to different world markets; 85 percent of the total export income comes from 292 types of ready-made clothing products. Only 15 percent of the revenue comes from the remaining 13 hundred products. However, among these 1,300 products, many have a huge market and are constantly increasing demand.

Leather and leather products, plastic products, light engineering products, and pharmaceuticals are growing markets. Bangladesh's capacity in these sectors is greater than that of many countries. As a result, there is excellent potential to increase export income from these sectors if the government gets proper policy support.

The economy of Bangladesh is currently moving forward at a steady pace. The government has taken practical steps to diversify exports. There should be a comprehensive review of tax rates, tax collection methods, and various incentives in the export sector because there are unnecessary initiatives in many cases. Research should also be emphasized so that new products can be invented. It cannot proceed depending on one product. Government policy should be changed to promote other export sectors. Vietnam does not have its own leather. Again, the population is less.

However, Vietnam exports about $30 billion of leather and leather products annually. But even though Bangladesh has its own leather and sufficient manpower, the export is one billion dollars. Demand for plastics is increasing worldwide.

This industry has a lot of potential. However, government policy support should be increased. The global economy is recovering after the impact of Covid. International trade has gained momentum. This is also reflected in the country's export sector. The Bangladesh Export Development Bureau statistics have also revealed that the export of goods from Bangladesh to the outside world exceeds the government's expectations.

As always, the garment sector plays a significant role in the growth of exports. The export pace is also upbeat in several other products, including leather and leather. Several brands of Bangladeshi products have gained international fame, creating a bright potential to grow its market. Bangladesh should continue diversifying export products and developing new markets by exploiting all possibilities to help us implement the SDGs.

Initiatives should be taken to export various types of products without restricting the export trade to certain products. Due to the promotion of international standards, the demand for multiple Bangladeshi products has been created in different countries. Some companies in Bangladesh have achieved unprecedented success, especially in the export of food and agricultural products.

The writer is a Essayist, Researcher and Columnist