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LightCastle Partners, in collaboration with Policy Exchange, provided technical assistance and conducted an assessment for the World Bank Group on Country Private Sector Development (CPSD) 2.0, focusing on greening the RMG sector in Bangladesh. The World Bank Group organized the workshop to present and validate the key findings from this assessment on June 11, 2024. This event brought together prominent figures, providing a platform to share their perspectives, articulate concerns, and propose potential solutions for the RMG sector in Bangladesh.
LightCastle Partners conducted the assessment using a combination of secondary and primary research. For the primary research, key informant interviews (KIIs) were conducted with policymakers, industry leaders, global and local buyers, engineering, procurement, construction (EPC) experts, and development partners among others. The insights and recommendations garnered were subsequently shared in this validation workshop attended by industry leaders, circularity innovators, LEED factory designers, and representatives from the World Bank.
The workshop commenced with an insightful presentation titled “ Support CPSD 2.0: Greening of the RMG Sector in Bangladesh” delivered by Hosna Ferdous Sumi, Senior Private Sector Specialist at the World Bank Group, highlighting the study findings. The presentation underscored key thematic issues, including green growth opportunities beyond 2026 for LDCs, investment prospects in the RMG sector value chain for integrating advanced energy efficiency technologies, a roadmap for adopting renewable energy sources for a greener value chain, and the necessity of implementing circularity and a closed-loop fashion lifecycle throughout the value chain.
These initiatives aimed to address challenges such as rising electricity prices impacting profit margins, the RMG export basket’s focus on low-value-added products, and Bangladesh’s slow transition to renewables, which raises environmental concerns, especially in light of upcoming EU policies.
Additionally, the workshop emphasized the importance of fiber diversification, as Bangladesh predominantly relies on cotton-based apparel exports in the global market. The growing demand for man-made fibers, such as viscose and polyester, was noted for their lower water usage and reduced greenhouse gas emissions compared to cotton, underscoring their inherent circularity characteristics.
The session concluded with stakeholders identifying key recommendations for the earliest implementation. The Readymade Garment (RMG) industry is vital for Bangladesh as it is the second-largest RMG exporter globally, with the sector contributing 15% to the GDP and accounting for approximately 85% of the country’s exports.
In addition, this sector also generates significant revenue, attracting foreign direct investment (FDI), and providing employment for low and semi-skilled workers for over 4 million workers among which 60% are women workers, thereby creating more livelihood opportunities.
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