Unlocking green benefits: What Bangladesh's apparel-makers need to secure higher prices from buyers 

Over the past few decades, Bangladesh has achieved notable economic and social progress. No doubt, the ready-made garment (RMG) industry is the key thread of this economic success story.  

Today, Bangladesh has become one of the world's largest garment exporters. The RMG sector accounts for 84% of the country's exports. The rapid growth and modernisation of the sector have played a vital role in improving the livelihood of the country's four million garment workers. 

After many ups and downs, the Bangladesh RMG sector has emerged as the leader in ensuring compliance standards, factory safety and due diligence in supply chain responsibility. This credibility aided Bangladesh in becoming an attractive apparel-sourcing hub globally, leading to sustainable progress. 

In recent times, there have been paradigm shifts in different economies and their business environment in terms of socially and environmentally responsible business practices, favourable trade agreements, digital transformation of business, emerging disrupting technologies, etc. Brands are focusing on sourcing environmentally friendly products to meet their commitment to the consumers.  

The rapidly rising burning issue in the global supply chain is human rights due diligence. This year the European Parliament approved the mandatory corporate sustainability due diligence directives (CSDDD) to ensure human rights and environmental due diligence in EU companies' global supply chains. 

During the price negotiations with buyers, our colleagues should bargain hard for sustainable environmental and social standard costs. Brands and retailers also have a gigantic role to motivate and aware consumers to purchase green clothing. 

Consumers are demanding a higher level of accountability and transparency from the supplier as their awareness increases about the human rights implications of business operations. Our industry has to implant a comprehensive due diligence approach to identifying and addressing the risks of human rights abuses in the supply chain, from the sourcing of raw materials to the manufacturing and distribution of finished products.  

Bangladesh has set an aim to reduce carbon emissions by 21.8% by 2030. Without the public-private partnership, it is impossible to attain the goal. As a significant stakeholder, readymade garment owners are continuously taking part in achieving the country's Just Transition Goal. 

To sustain competitiveness, with the highest commitment towards sustainable industry development, Bangladesh has become the home of the world's top-rated green factories. We are the global champion in terms of the number of highest LEED-certified factories. 

It is encouraging that the number of green buildings in the RMG and textile sector reached 218, whilst around 386 RMG and textile factories are in the certification process.  Moreover, a good number of knitwear firms have installed water and energy-efficient technologies and techniques in various sections of the production process, including, water metres, effluent treatment plants (ETP), dual flash, and low flow tap, rainwater harvesting, using sub-meter, using economizer in a boiler, servo motors replacing the clutch motor, using solar energy (photovoltaic), using LED bulbs, using inverted technology in air conditions (AC), etc. are notable. 

Partaking in new initiatives regarding climate change and circularity has advanced the sector's sustainability agenda. We are promoting the circular economy through a multistakeholder initiative. More than 1200 Bangladeshi companies are certified by the Global Organic Textile Standard. Our industry is navigating the necessary transformation by adapting a sustainable business approach with the inevitable structural changes. 

In the backdrop, behind every success story, there is a naked truth of bitterness. Still, Bangladesh's ready-made garments industry is going through many challenges. It requires a huge investment for green factory installation which is more than 20 to 30% of conventional factory installation cost. 

While renewable energy is being prioritised around the world, Bangladesh has to pay Total Tax Incidence (TTI) ranging from 25% to 58% on imported solar panels, inverters and other high-capacity components, which is creating a significant burden on factory owners. For this reason, all types of taxes and duties should be exempted to inspire manufacturers to green investment. 

TUF (Technology Up-gradation Fund) could be a great source of financial assistance to businesses for acquiring the latest technology. If we look back to our competitor countries, already India has approved the Technology Up-gradation Fund for their industry investors. 

The availability of this fund could enable industries to modernise their machines and processes. Bangladesh also has such funds for its potential entrepreneurs, but due to the process's complexity, it remains unreachable to the beneficiaries. To attract and secure new investment, industry-centred policy needs to be enforced by the government.

Lack of negotiation skills is another challenge for Bangladeshi factory owners. Our entrepreneurs are so upset with the buyers' unethical attitude toward green product fair pricing.

The most interesting part is everyone appreciates Bangladesh's progress towards a sustainable industry, but in terms of payment, there is no willingness to pay the appropriate price for sustainable green clothing.

During the price negotiations with buyers, our colleagues should bargain hard for sustainable environmental and social standard costs. They also need to try to rebrand the RMG sector by showcasing its positive strengths.  Brands and retailers also have a gigantic role to motivate and aware consumers to purchase green clothing.

The writer is the president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA).