Trump’s tariff tsunami threatens to drown Bangladesh garments industry

Bangladesh’s ready-made garments sector, already struggling to stay afloat amid job losses, labour unrest, and political instability, now faces the threat of being drowned by the Donald Trump administration’s tariffs tsunami.

Bangladesh is the world’s second largest producer of ready-made garments after China. It had already taken multiple blows when the US declared a whopping 37 per cent tariff on ready-made garments from the South Asian country.

Shuttering garments sector

A report by fashion media house Apparel Resources says at least 76 garment factories have closed down in the past one year, the worst hit being those in and around the port city of Chittagong.

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More than 50,000 workers, mostly women, have lost their jobs. Out of 611 registered garment factories in Chittagong area, the Bangladesh Garment Manufacturers and Exporters Association says only 350 were still running.

Among them, 180 factories are working on foreign orders while 170 operate as subcontractors.

Hundreds of units closed

But other estimates suggest that the total number of factory closures could be more than thrice as many.

Quoting Industrial Police, leading daily Prothom Alo said 95 ready-made garment factories have shut in the core industrial districts between August 2024 and March 2025 — 54 in Gazipur, 23 in Narayanganj-Narsingdi and 18 in Savar-Ashulia.

These factories collectively employed 61,881 workers and employees, the report said.

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Trump effect

The Trump administration has now slapped a whopping 37 per cent tariff on Bangladesh's ready-made garments, up from 16 per cent tariff on cotton garments and 32 per cent for polyester garments.

Much of Bangladesh's exports to the US is cotton garments.

Garment manufacturers and economists in Bangladesh have described the US tariffs as "a massive blow” for which, one business leader said, “we were not prepared". They fear losing buyers to other cost-competitive markets.

US in main buyer

Twenty per cent of Bangladesh's annual ready-made garments exports are to the US — last year, the exports totalled $8.4 billion.

Finding buyers elsewhere takes time and effort and is not going to be easy, leading factory owners admit.

They also fear a major 'cascading effect' on the national economy because of its heavy dependence on the ready-made garments sector.

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International brands

Bangladesh has nearly 4,600 ready-made garment factories that makes it a hub for apparel sourcing for even the most elite global brands such as Carrefour, Uniqlo, Primark, H&M, Zara, and M&S.

"We were not ready for this blow; it was so sudden," said Anwar Hossain, administrator at the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).

Hossain has only one cause for comfort — other competitors such as China and Vietnam have been slapped with much higher rates of tariff by the US.

Unrest, political violence

Over the past three to four years, Bangladesh's ready-made garments industry has been hit by serious labour unrest, with frequent workers protest for higher wages, better working conditions and unpaid salaries.

The Business & Human Rights Resource Centre reported that 183 garment factories have shut down due to ongoing protests.

The country’s interim government recently imposed a travel ban on the owners of 12 ready-made garment factories for failing to pay workers' salaries and bonuses before the deadline of March 27 set by the authorities.

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Workers’ distress

Labour and employment adviser Brig Gen (Retd) M Sakhawat Hossain told the media that these owners will not be allowed to leave the country until they settle the outstanding wages and bonuses.

But frequent labour unrest and political violence following the ouster of the Sheikh Hasina government in August 2024, coupled with power shortages and port congestion, has caused disruptions in delivery to foreign buyers and made them explore alternatives.

Post-Hasina violence

After the ouster of the Awami League government, scores of factories owned by pro-Awami businessmen were vandalised, forcing many to go into hiding.

Some, like Hasina's investment adviser Salman Rahman, whose Beximco group was a top player in the garments sector, have been jailed.

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Automation challenge

The ready-made garments sector accounts for 11 per cent of Bangladesh's GDP and employs more than four million workers, more than 70 per cent of them being women.

With competition from garment-producing countries such as Vietnam and Cambodia, the industry in Bangladesh is compelled to modernise.

A 2023 Shimmy Technologies survey observed that 80 per cent of Bangladesh’s top factories planned to invest in semi-automated machines within two years, which may lead to reduction of its workforce by 22 per cent.

Women in crisis

A detailed recent report in the Rest of World by Jesmin Papri said workers, especially women, are forced to work under extreme pressure, with automated tracking devices monitoring their productivity.

Devices like "Nidle" track the number of pieces a worker sews per hour. Failure to meet their target puts them at risk of being fired.

Workers reported skipping meals and bathroom breaks to keep up with the machines, leading to health problems and stress.

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The fallout

All this is bad news for the cause of women empowerment in Muslim-majority Bangladesh, where a gender revolution of sorts had taken shape over the decades, less as a result of conscious government policy and more because of the amazing growth of the ready-made garments sector and the economic opportunities it provided for women.

Financially independent women became more assertive in the family ambit and more visible in public space, challenging religious conservatism. Success stories of women entrepreneurs in the garments sector began to multiply.

With Islamist radicalism on the rise after the ouster of the Awami League government, job losses will aggravate rather than alleviate poverty and make Bangladeshi women more vulnerable to religious conservatism with possible loss of hard-earned rights.

A dark future

With the unelected Muhammad Yunus regime increasingly dependent on Islamists like the Jamaat-e-Islami, who have tried stopping women from playing soccer and appearing in public space without veil, loss of financial independence comes as a double whammy for them.

Women leaders even fear increased trafficking of Bangladeshi women in the regional flesh trade and a possible spurt in illegal migration into India.