Is it Vision or hallucination "A road map to $50 Billion within 2021" - Bangladesh Textile Industry in competitive Global Market.

1. WELCOME
To My
Presentation

2. Mini Project: 01
Title: Forecasting Methods to Forecast, Bangladesh Textile Industry in
Competitive Global Market
AT 6004: Technology Forecasting
Course Teacher
Prof. Dr. Iftekhar Uddin Bhuiyan
Assistant Professor of IAT, BUET
Institute of Appropriate Technology (IAT), BUET
Submitted by
Name Student ID Session
RATHIN CHAKRABORTY 101729-2005 OCT’2017

3. In this report, we will demonstrate a novel approach of the Bangladesh Textile
Industry known as the Ready Made Garment (RMG) in aspects of present and
past trend analysis of the global market contribution ($50 billion, is it reality or
dream) by using most frequently used forecasting methods (e.g. Monitoring,
Expert opinion, Trend analysis, Modeling and Scenarios).
It also includes some prospective ideas or suggestions based on probability-
analysis of different factors. To make Bangladesh competitive in global market
most important factors grouped into nine broad categories:
Trade
Political Climate and Natural Endowments
Policy Environment
Labor
Factory capacity
Costs
Infrastructure
Financial Environment
Productivity

4. "Prediction is very difficult, especially if it's about
the future." - Nils Bohr.
 The textile industry is the rising star in the sky of total export in
Bangladesh.
 This industry is the economic backbone of Bangladesh. Textile and
Ready-Made Garments (RMG) industries are contributing to the
income of around 15 million peoples and offering more than 77% of
total national exports.
 This sector holds around 40 % of the annual export performance,
which shows how, signifying role play on this sector in our economy.
 In the world currently, 6·4 billion people consume 60 billion kg of
textile fibers. This means each person uses approximately 10 kg of
fibers per year. The demand of textile is never ending and it will not
be finished until the doomsday.

5. Knitting Yarn
Dyeing
Dyeing Garmen
ts
Printing Narrow
Fabric

6. Year Issue
1970-1980 Early period of growth
1982-1985 Boom Days
1985 Imposition of quota restriction
1990 Knitwear sector developed significantly
1993-1995 Child labor issue and its solution
2003 Withdrawal of Canadian quota restriction
2005 Phase out of quota restriction
2006 Riots and strikes by garments labor
2007 - 2015 Stable growth Continuous growth
Table 1. Important issues related to the Bangladesh ready-made garment industry
 Reaz garments established in 1960, as a small tailoring outfit, named Reaz store in
Dhaka. Served only domestic market of its initial 15 years. In 1973, it changed its name to
Reaz Garments Ltd. and started to export by selling 10 000 pieces of shirt to France,
valued 13 million franc in 1978.That was the first direct export of apparel.
 Desh Garments Ltd., first joint venture in Bangladesh, Technical and marketing
collaboration with S. Korean Daewoo Corporation, established in 1979. First 100% export
oriented company.

7. After scanning the global market share of Bangladesh textile industry, we have found
that the global export of garments decreased by 6.8 percent in the year 2015 and reached
to 442.35 billion USD after a great year 2014. After that in 2016, the market was almost
stable producing 442.12 billion USD.
Exporter/Year 2012 2013 2014 2015 2016
World 405112300 440248728 474684870 442354875 442123993
China 148269585 165044601 173437980 162348987 147793700
Bangladesh 19271198 19567733 Data N/A 26532326 33452933
Vietnam 14078822 16745481 19699178 21434183 24655528
Turkey 13849886 14959139 16256751 14845200 14784503
Germany 17650924 18297393 19461448 16656698 17116335
India 12896322 15702657 16538203 17131190 16961165
Italy 20345172 21639999 22938683 19400009 19968409
Hong Kong, China 21280613 20717212 19387296 17445637 14915743
Cambodia 4005756 4806443 5319879 5916473 10277967
Indonesia 7184170 7383998 7359754 7283375 7171032
Sri Lanka 3780770 4270811 4681465 4547691 4598051
Pakistan 3700676 3960247 4387275 4487070 5613238
Table 2: Export in value Thousand USD
Source: Bangladesh Textile Today _ ITC (International Trace Corporation) data from World Trade Organization (WTO)

8. 46.58%
10.54%
7.77%
4.66%
5.39%
5.35%
6.29%
4.70%
3.24%
2.26%
1.45%
1.77%
Export Percentage - 2016
China
Bangladesh
Vietnam
Turkey
Germany
India
Italy
Hong Kong, China
Combodia
Indonesia
Sri Lanka
Pakistan
Figure: Export percentage trend of major apparel exporters in the world - 2016 (Source ITC-WTO).
Recent reports of Export Promotion Bureau (EPB) Bangladesh show
Bangladesh RMG is not being able to achieve export targets which could be
a setback in reaching the 2021 goal of the country to reach 50 billion export.

9. Figure: VALUE OF TOTALAPPAREL EXPORT (Fiscal Year Basis)
1240.48
1291.65
1835.09
1948.81
2237.95
2844.43
2984.96
3081.19
3364.32
3124.82
3258.27
3538.07
3598.2
4083.82
4657.63
5167.28
5918.51
6013.43
8432.4
9603.34
11039.85
12442.07
13064.61
14738.74
14392.59
204.54
264.14
393.26
598.32
763.3
937.51
1035.02
1268.22
1495.51
1458.93
1653.82
2148.02
2819.47
3816.98
4553.6
5532.52
6429.26
6483.29
9482.06
9486.39
10475.88
12049.81
12426.79
13355.42
13757.25
1992-93
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
TOTALAPPAREL EXPORT IN MN.US$ Woven Knit

10. Figure: MAIN APPAREL ITEMS EXPORTED FROM BANGLADESH
805.34
1073.59
1334.85
6026.69
3546.88
225.9
4696.57
5861.98
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
EXPORT VALUE IN MN. US$
SHIRT TROUSERS JACKET
T-SHIRT SWEATER

11. We have received opinions from three experts in the related area and also
collect data from the internet, then subsequently examining the opinions we
have prepared a report. Here are some key points from the report:
 At this moment, Bangladesh Textile industry market is still rising at a steady
rate due to more widespread adoption in emerging markets. We estimate the
global market will cross about 40 billion units shipped in 2021.
 To expand business into untapped markets outside of the USA and EU,
Bangladesh industrialists needs in the urgent necessity of conducting their
business by gaining complete knowledge of GDP, economy, seaport, capital &
other important cities of a country, per capita income, time gap with
Bangladesh, economic demand, main tariff and non-tariff barriers, a list of the
main imports of knit and RMG products, list of import price differences
between Bangladesh and other countries.
 In our study, all the respondents identified attractive (low) prices as the most
important reason for purchasing in Bangladesh.

12. Table-3: Sector wise Textile Products:
Sector Products
Spinning Yarn
Weaving Grey woven fabric
Knitting Grey knit fabric
Dyeing and
finishing
Dyed or printed fabric
Apparel or
garments
Men, women and baby wear
Jute Carpet, twine, hessian, and sacking.
Seri-culture Silk yarn and silk fabric
Handloom Sharee (Jamdani and Banarosi), Lungi and Gamsa.
Power looms Sharee, Lungi, Gamsa and different woven cloth.

13. FACT FY 2014-15 Vision - 2021 Vision - 2050
Knitwear Export $ 12.04 Billion $ 21.08 Billion $ 32.62 Billion
Growth of Knit (%) 15.6 20.9 32.1
Share in Apparel Export (%) 49.75 52.3 69.4
Share in National Export (%) 39.93 41.7 53.2
Share of GDP (%) 6.9 7.2 12.12
Employment Generation 1.6 Million 2.8 Million 4.9 Million
Female Empowerment (%) 45 52 67
Enhancement of Women Savings (%) 8.8 13.69 29.2
Poverty Reduction (%) 6.4 7.5 9.1
Banking & Insurance BDT 176 Billion BDT 187 Billion BDT 201
Million
Shipping & Logistice Industry $ 79 Million $84 Million $ 91 Million
Forward and Backward Linkage Industry BDT 212 Million BDT 221 Million BDT 254
Million
Engineering Sector $ 10.1 Million $14.1 Million $ 19.4 Million
Economic Forecasting Methods: Autoregressive moving average with exogenous inputs (ARMAX), Forecast skill (SS) And
Regression Analysis
Table-4: Future Projection of Bangladesh Knitwear Industry:

14. Trend analysis is a mathematical and statistical techniques used to extend time series data
into the future. Though the statistics show the trend of the Bangladesh Textile industry
installation creates new job, but the factory establishment rate is very low in recent trend
due to riots and strikes by garments labor, quota restriction, all the raw materials need to
be imported, increase of product prices etc.
384
594
629
685
725
759
834
1163
1537
1839
2182
2353
2503
2726
2963
3200
3480
3618
3760
3957
4107
4220
4490
4743
4925
5063
5150
5400
5876
4222
4296
4328
4482
1.2
2
2.8
3.1
3.2
3.4
4
5.8
8
8.3
12
12.9
13
15
15
16
18
18
20
20
20
22
24
28
35
36
40
40
40
40
40
40
40
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90
1990-91
1991-92
1992-93
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
Number of Factories and Employment
No. of Factories
Employment (Lakh)
Figure: Trade Information (Factory Installation and Employment)

15. A simplified representation of the structure and dynamics of part of the real
world. Models range from flow diagrams, simple equation and physical
models to computer simulation.
Models exhibit future behavior or ‘vision’ of a complex system which is
sometimes referred as ‘hallucination’.
There is a distinctive difference between ‘vision’ and ‘hallucination’. A vision
is something which is real. When you have a vision you make sure it is real,
possible, achievable and other people can also see it. But when you are in
hallucination, other people cannot see what you see.
Bangladesh’s
popularity has
reduced over the
time, but still it is
the most favorite
place for sourcing
after China.

16. Utility Shortage
Status: 2300 mmcfd natural gas production
against 3000 mmcfd demand (Petrobangla)
Fact: Bangladesh takes 404 days on average to
amke a new electricity connection, ranked 189th
globally (World Bank)
Poor Infrastructure
Status: Limited mobility within metropoliton cities.
Severe bottleneck in peak season to transport
products to the seaport.
Fact: Bangladesh ranked 127th out of 144
countries in infrastrusture (World Economic
Forum, 2014)
Compliance
Status: 90% factory fire dropped; not a single
death from fire in 2015 (Alliance, 2016)
Fact: Bangladesh has been facing a
severe image crisis after Rana Plaza
Collapse.
Raw Materials
Status: Very dependent for raw materials.
Fact: Imported 1.32 M tonnes (6.1 M Bales) of
raw cotton in 2015 (BTMA).
90% demand of raw materials of Knitwear
sector & only 40% of woven sector are meet
locally (BTMA)
Target: 10.9% annual growth
Fact: Except 2010 to 2011
(43.24% growth), Bangladesh
averaged 8.8% last six years
(2010-2015)
Matrix of the Challenges the RMG industry has to reach USD 50 billion Export

17. Snapshots of some aspect of the future and the paths leading from the present to the
future of the Bangladesh Textile Industry.
• The textile industry is connected with meeting the demand for clothing, which is a
basic necessity of life.
• It is an industry that is more labor intensive than any other in Bangladesh, and thus
plays a critical role in providing employment for people.
• It has contributed to employment creation, poverty reduction as well as women
empowerment.
• More than 81% of export earnings comes from the textile sector.
• Contributes over 13% of GDP, 40% industrial value added comes from the textile
sector.
• Provide huge opportunities for the supporting industrial, banking, insurance,
shipping, transport, toiletries, cosmetics, hotel and other related economic activities.
• Provide 55 lakh of employment where 80% are women.
• 150 lakh of peoples in support industries depends on this trade.
• Provides 2 lakh jobs in the waste recycling industry related to textiles.

18.  Bangladesh Ready-Made Garment (RMG) factory produces
different types of products such as Shirts, Pants and T-Shirts,
Trousers etc.
 Though it has a number of well-known RMG factories, but
most of them did not use any scientific method to find future
demand of their products to produce for the purpose of sales,
that’s why they face some problems regarding production.
 The factory needs a reliable forecasting for demand of a
finished product. This report tries to focus on:
• Forecasts global garments export rate through 2021.
• Explores why Bangladesh is the next high-growth RMG market
shares.
• Modern Textile Technology (eg. Textile Machinery, 3D printing)
• Breaks down the global Textile platform wars.

19. Small
Local
supplier Export
oriented
Composite
Garment
Producer
Successful
Trading with
Giant
Retailers Like
H&M, Lerros,
C & A, & so
many others
Concern for
Social &
Environmental
Safety Aim towards
Resource
Efficient &
Sustainable
business
G
ar
m
e
nt
1978
2021‘Green Environment’

20. Resource
Consumption
Productivity
National Black
out day
01.11.2014

21. Major
Energy
Consuming
Areas
Utility
(Air & Water
Supply,
Effluent
treatment)
Producti
on-
House
(Knitting,
Dyeing,
Garments)
Captive
Power
Generation
Steam
Generation
 For our Environment
 For safety of workers
 For Sustainable business
- Optimum Consumption.
- Produce more.
- Reduce Emission.
Green Industry steps forward to change
our infrastructures to…
Benchmarking Resource Consumption
Process Re-Engineering
Efficient Utilization

23. Transport
facilities for
worker.
Hours of work.
Voluntary over
time.
Intervals for rest. Weekly holidays.
Annual leave.
Festival holidays
& leaves with
bonus.
Worker's welfare
committee.
Mineral drinking
water.
Sanitary
facilities.
Canteen services.
Health care
activities for the
worker & employ
company doctor.
Fire Extinguisher
Environmental
developer.
Smoking free
zone.

24.  RMG is the highest contributor in terms of both gross and net
export earnings.
 Comparing with other items in Bangladesh, the contribution of
RMG in national export earnings is more than 76%.
 But, Bangladesh textile industry is going through one of the
toughest periods in day after day.
 Finally, this paper reflects that wholehearted joint efforts from
manufacturers, buyers, suppliers, government, and other
stockholders are highly expected to accomplish the development
of potential and sustainable textile (garments) industry’s growth
in Bangladesh.
 More accurate forecasting can be done in the future through
some computing technological methods.

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327.
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