Why the US tariff cut matters for Bangladesh’s apparel industry

The recent reduction in US tariffs on Bangladeshi apparel exports marks a significant turning point for our industry—and perhaps one of the most promising windows of opportunity we’ve seen in recent years.

Initially, the proposed 35 per cent tariff was nothing short of alarming. It threatened to undercut our competitiveness in our single most important export market. But thanks to timely diplomatic engagement and strong government efforts, the tariffs have now been reduced to around 20 per cent—a rate that, while still substantial, restores a degree of balance to the global trade playing field.

This revised rate allows us to remain competitive. At Ananta Apparels, which exports over $465 million annually—$170 million of which goes to the United States—we see this decision as a lifeline. Without this adjustment, the consequences could have been disastrous. Now, Insha’Allah, we are confident that we can continue serving our American partners without major disruption.

Some may argue that Bangladesh should shift its focus to other markets. But let us be clear: the US market is irreplaceable. It is vast, stable, and has been the foundation upon which much of the apparel success of countries like China and Vietnam has been built. Now that Chinese apparel faces tariffs exceeding 34 per cent—including the existing 30 per cent—we may be witnessing a reordering of global sourcing patterns. Bangladesh stands to benefit significantly.

To seize this opportunity, however, we must be ready. Bangladesh’s apparel industry is mature. We have decades of experience, deep-rooted infrastructure, and a growing capability in producing value-added goods. Where countries like China and Vietnam once dominated niche categories such as sportswear, performance apparel, and high-end outerwear, we now have a chance to step up and fill that gap.

But capitalising on this shift will require strategic thinking beyond the factory floor. Trade is no longer just about product and price—it is increasingly shaped by geopolitics and long-term policy alignment. For example, if part of a broader trade strategy involves importing LNG from the United States, I see that not as a liability but as a form of strategic engagement. The same applies to aircraft procurement. Boeing aircraft deliveries take at least six years. These are not transactional purchases; they reflect long-term diplomatic partnerships. Bangladesh’s decision to purchase 25 Boeing aircraft aligns with this broader vision, as do similar decisions by countries like India.

Even in agriculture, US products—whether corn, wheat, or cotton—tend to command a premium due to their quality. We have seen this in our operations. US cotton, while slightly more expensive, offers consistent and superior quality, making it ideal for premium garments and performance textiles.

What is even more relevant now is the US government’s new policy supporting its cotton farmers. American retailers are now eligible for duty waivers if they use at least 20 per cent US cotton in their garment sourcing. That means buyers can enjoy zero tariffs on a portion of their FOB value if US cotton is used. This is a game-changer—especially for Bangladesh, which can position itself as a high-quality, duty-advantaged sourcing destination if we align smartly with such programmes.

In short, the recent tariff reduction is not just a relief—it is an inflexion point. But to turn it into long-term growth, we must act decisively. That means improving value addition, strengthening compliance and sustainability standards, negotiating better trade facilitation, and deepening strategic ties with key partners such as the United States.

The future of our RMG sector will not be determined solely by volume—it will be shaped by our ability to adapt, align, and lead. The opportunity is here. The question is: are we ready to rise to it?

Sharif Zahir is the Managing Director of Ananta Apparels and Chairman of United Commercial Bank Limited.