CPD-Green Transition

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Securing

Green Transition of the


Textile and Readymade Garments Sector in Bangladesh

Fahmida Khatun
Muntaseer Kamal
Foqoruddin Al Kabir
Nadia Nawrin
Mohammad Syful Hoque
Securing Green Transition of the Textile and RMG Sector

SECURING GREEN TRANSITION OF THE TEXTILE AND


READYMADE GARMENTS SECTOR IN BANGLADESH

Fahmida Khatun
Muntaseer Kamal
Foqoruddin Al Kabir
Nadia Nawrin
Mohammad Syful Hoque

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Securing Green Transition of the Textile and RMG Sector

Publisher

Centre for Policy Dialogue (CPD)


House 40/C, Road 11 (new)
Dhanmondi, Dhaka-1209, Bangladesh
Telephone: (+88 02) 48118090, 55001185, 58156979
Fax: (+88 02) 48110414
E-mail: [email protected]
Website: www.cpd.org.bd

First Published October 2023


@ Centre for Policy Dialogue (CPD)

Disclaimer: The views expressed in this paper are those of the authors alone and do not necessarily
UHߕHFWWKHYLHZVRI&3'

Cover Design
Avra Bhattacharjee

Page Layout and Typesetting


Md Shaiful Hassan

Citation: Khatun, F., Kamal, M., Kabir F. A.,Nawrin, N., and Hoque. M. S., (2023). Securing Green Transition
of the Textile and Readymade Garments Sector in Bangladesh. Dhaka: Centre for Policy Dialogue (CPD).

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Securing Green Transition of the Textile and RMG Sector

Acknowledgements

The Team gratefully acknowledges the valuable support received from the Dialogue
and Communication Division, and the Administration and Finance Division of CPD in
conducting this study. Support from Mr Zulker Naeen, former Programme Associate,
CPD is particularly appreciated. The Team would like thank Bangladesh Garment
Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers
and Exporters Association (BKMEA), Bangladesh Textile Mills Association (BTMA) for
their cooperation. The Team would also like to register its sincere thanks to authorities
RIWKHIDFWRULHVWKDWZHUHYLVLWHGGXULQJWKHVXUYH\DQGߔHOGYLVLWV:HDOVRDFNQRZOHGJH
the support of Org-Quest Research Limited for conducting the survey. Finally, the Team
records its sincere appreciation to the participants of the Expert Group Meetings (EGMs)
for their valuable insights and comments.

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Securing Green Transition of the Textile and RMG Sector

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Securing Green Transition of the Textile and RMG Sector

Contents

Acknowledgements iii
Acronyms vii

1. Context 1

2. Data sources and methodology 1

3. Analytical framework of the study 3

. *eneral information of factories: si]e location green certiÀcates 

5. Green measures undertaken by factories 7

6. Social aspects of greening factories 9

7. Barriers for greening factories 11

8. Conclusions and recommendations 18

References 21

List of Tables and Figures

7DEOH0RWLYDWLRQVIRU2EWDLQLQJ*UHHQ&HUWLߔFDWH 
Table 6.1: How Often Do the Workers Meet Their Daily Production Target 10
Table 6.2: Workers’ Absence in The Last Month Due to Sickness 11

Figure 2.1: Survey coverage 2


Figure 3.1: Holistic view of Greening Industries 3
Figure 3.2: Pathways of Greening of Industries 4
Figure 4.1: Distribution of Factories by Industry and Size 5
)LJXUH)DFWRULHV‫ڕ‬.QRZOHGJHDERXW*UHHQ&HUWLߔFDWLRQ 
Figure 5.1: Green Investment of Factories in Various Greening Practices 7
Figure 5.2: Average Use of Electricity in a Month by Factories 8
Figure 5.3: Source of Electricity Use by RMG Factories in Tier Groups 8

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Securing Green Transition of the Textile and RMG Sector

Figure 5.4: Factory Groupwise Average Green Investment in Last Five Years 9
Figure 6.1: Age Group Distribution of the Workers 10

Annex

Tables, Figure and Infographics

7DEOH$2WKHU(QYLURQPHQWDO&HUWLߔFDWHV 
Table A5.1: Investments, Loans, and Interest Rate 24
Table A6.1: Distribution of Respondents by Size and Gender 24

Figure A4.1: Tier-wise Distribution of Surveyed RMG Factories 23

Infographic 1 25
Infographic 2 27
Infographic 328

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Securing Green Transition of the Textile and RMG Sector

Acronyms

8FYP Eighth Five-Year Plan


BB Bangladesh Bank
BBS Bangladesh Bureau of Statistics
BCI Better Cotton Initiative
BGMEA Bangladesh Garments Manufacturer Association
BIWTA Bangladesh Inland Water Transport Authority
BSCI Business Social Compliance Initiatives
BTMA Bangladesh Textile Mills Association
DFQF Duty Free Quota Free
DNCC Dhaka North City Corporation
DoE Department of Environment
EBA Everything but Arms
ECA Environmental Conservation Act
EGMs Expert Group Meetings
EPB Export Promotion Bureau
EPZs Export Processing Zones
(73 (IߕXHQW7UHDWPHQW3ODQW
FGDs Focus Group Discussions
FY Fiscal Year
GDP Gross Domestic Product
GED General Economic Division
GoB Government of Bangladesh
GOTS Global Organic Textile Standard
GSP Generalised Scheme of Preference
ILO International Labour Organization
IT Information Technology
KIIs Key Informant Interviews
LDC Least Developed Country
LED Light Emitting Diode
LEED Leadership in Energy and Environmental Design
MCPP Mujib Climate Prosperity Plan
MoC Ministry of Commerce
MoEFCC Ministry of Environment Forest and Climate Change

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Securing Green Transition of the Textile and RMG Sector

MoF Ministry of Finance


MoI Ministry of Industries
MoIB Ministry of Information and Broadcasting
MoP Ministry of Planning
MoPEMR Ministry of Power, Energy and Mineral Resources
NSDA National Skills Development Authority
OCS Organic Content Standard
OECD Organization for Economic Cooperation and Development
302 3ULPH0LQLVWHU‫ڕ‬V2IߔFH
5(&3 5HVRXUFH(IߔFLHQF\DQG&OHDQHU3URGXFWLRQ
RMG Readymade Garments
SMEs Small and Medium Enterprises
SMI Survey of Manufacturing Industries
SREDA Sustainable and Renewable Energy Development Authority
SRS Simple Random Sampling
UNIDO United Nations Industrial Development Organization
USA United States of America

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Securing Green Transition of the Textile and RMG Sector

1. Context and their stringent enforcement. As a part of this


effort, the Government of Bangladesh (GoB) and
The export-oriented textile and readymade the textile and RMG sector need to have a clear
garments (RMG) sector is an important driving strategy for accomplishing environmental and
force of the economy of Bangladesh as it is a sustainability commitments in areas such as clean
source of employment generation and foreign HQHUJ\ FDUERQ QHXWUDOLW\ ZDVWH PDQDJHPHQW
exchange. Within the entire sector, RMG alone robust climate actions vis-à-vis the emerging EU
HDUQHG86'ELOOLRQLQߔVFDO\HDU )<  *UHHQ 'HDO DQG FLUFXODU HFRQRP\ IUDPHZRUNV
 7KLV ZDV  SHU FHQW RI WKH WRWDO H[SRUW )ROORZLQJ WKH 3DULV &OLPDWH $JUHHPHQW LQ 
HDUQLQJV LQ WKDW \HDU DQG  SHU FHQW RI WKH and net-zero commitments of countries by the
total gross domestic product (GDP) of the country PLGGOH RI WKH FHQWXU\ DW &23 WKHUH LV KLJKHU
%*0($(3% 7KHWZRPDMRUH[SRUW and more stringent demand for environment
destination of the Bangladeshi RMG products and climate-friendly production in all sectors
are the European Union (EU) countries and the DQG EXVLQHVVHV +RZHYHU JLYHQ WKH HQRUPLW\
8QLWHG 6WDWHV RI $PHULFD 86$  ,Q )< of the tasks involved in achieving climate goals,
 WRWDO 50* H[SRUW WR WKH (8 ZDV 86'  collaborative efforts are needed, that involves all
ELOOLRQZKLFKZDVSHUFHQWRIWKHWRWDO50* stakeholders such as the entrepreneurs, buyers,
export of the country. The RMG export to the and the government.
86$ ZDV 86'  ELOOLRQ LQ )< ZKLFK
ZDV  SHU FHQW RI WKH WRWDO 50* H[SRUW$V In the above context, the present study has
a least developed country (LDC), Bangladesh examined the state of green transition initiatives
KDV EHHQ HQMR\LQJ GXW\ IUHH TXRWD IUHH ')4)  in the textile and RMG sector of Bangladesh
market access under the Generalised Scheme of based on evidence collected from primary
Preference (GSP) under the EU’s Everything but VRXUFHV 7KH REMHFWLYHV RI WKH VWXG\ DUH WR L 
Arms (EBA) initiative. EXLOG D QDWLRQZLGH IDFWRU\OHYHO HYLGHQFH RQ
the state of green practices in the textile and
$SSUR[LPDWHO\ RYHU  IDFWRULHV LQ WKH WH[WLOH 50* VHFWRU LL  FROOHFW HYLGHQFH RQ WKH W\SH RI
DQG50*VHFWRUVHPSOR\PLOOLRQSHRSOH 0L% barriers to and drivers of green transformation in
 %70$   7KH VHFWRU SOD\V D FULWLFDO the textile and RMG factories and investigate if
UROH LQ ZRPHQ‫ڕ‬V HFRQRPLF HPSRZHUPHQW VLQFH WKHVHDUHV\PPHWULFDFURVVDOOVL]HVRIIDFWRULHV
WKHVKDUHRIZRPHQZRUNHUVLVSHUFHQWRIWKH LLL  H[SORUH IDFWRULHV‫ ڕ‬NQRZOHGJH LQWHUHVW DQG
WRWDOHPSOR\PHQWLQWKH50*LQGXVWU\ 0L%  FDSDFLW\LQDGRSWLQJJUHHQWUDQVLWLRQLQLWLDWLYHV LY 
As an export-oriented industry, the textile and XQGHUVWDQG ZRUNHUV‫ ڕ‬DZDUHQHVV DQG SHUFHSWLRQ
50*VHFWRUPXVWFRPSO\ZLWKLQWHUQDWLRQDOODERXU RQEHQHߔWVRIJUHHQSUDFWLFHVDQG Y PDNHDVHW
ODZVVDIHW\VWDQGDUGVLQZRUNLQJFRQGLWLRQVDQG of recommendations to overcome the challenges
environmental compliance to remain competitive in making a green transformation of the textile
and meet the evolving standards of global brands. and RMG sector of the country.

)ROORZLQJ%DQJODGHVK‫ڕ‬VJUDGXDWLRQIURPWKH/'& 2. Data Sources and


FDWHJRU\ WR D GHYHORSLQJ FRXQWU\ LQ  WKH Methodology
FRXQWU\ZLOOORVHSUHIHUHQWLDODFFHVVWRWKH(8DQG
other developed and developing country markets The study used a mixed approach involving both
for its RMG exports. As a developing country, TXDQWLWDWLYHDQGTXDOLWDWLYHWRROVDQGWHFKQLTXHV
Bangladesh can avail market access through the As part of the methodology, the study employed
*63 VFKHPH XSRQ IXOߔOOLQJ VHYHUDO FRPSOLDQFH four methods.
UHODWHG FULWHULD %DQJODGHVK PXVW ZRUN WRZDUGV
UDWLߔFDWLRQ RI DOO WKH  FRUH ODERXU FRQYHQWLRQV )LUVW D SULPDU\ VXUYH\ ZDV FRQGXFWHG DPRQJ
of the International Labour Organization (ILO) RZQHUV PDQDJHUV ZRUNHUV DQG VXSHUYLVRUV

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Securing Green Transition of the Textile and RMG Sector

Figure 2.1: Survey coverage

Mymensingh

Sirajganj
Chattogram
Tangail

Gazipur
Narsingdi
Kushtia Dhaka
Manikganj

Narayanganj
RMG
Textile
Source: ƵƚŚŽƌƐ͛ŝůůƵƐƚƌĂƟŽŶ͘

RI  IDFWRULHV LQ WKH WH[WLOH DQG 50* VHFWRU ZHUHFRQGXFWHGZLWKIDFWRU\RZQHUVDQGWRS
EHWZHHQ -XQH DQG 1RYHPEHU $GGLWLRQDOO\ PDQDJHUV6L[DGGLWLRQDO.,,VZHUHFRQGXFWHGZLWK
D WRWDO RI  ZRUNHUV DQG VXSHUYLVRUV ZHUH LQGXVWU\LQVLGHUV RZQHUVPDQDJHUVVXVWDLQDEOH
LQWHUYLHZHG IURP WKH DIRUHPHQWLRQHG IDFWRULHV RIߔFHUVDQGJUHHQFHUWLߔFDWLRQFRQVXOWDQWHWF WR
6DPSOHV ZHUH VHOHFWHG IROORZLQJ WKH 6LPSOH obtain an in-depth understanding of barriers and
Random Sampling (SRS) method. Of the surveyed challenges pertaining to green transition. Another
IDFWRULHVZHUH50*IDFWRULHVZKLOHZHUH IRXU.,,VZHUHFRQGXFWHGZLWKEUDQGVDQGEX\HUV
WH[WLOHIDFWRULHV7KHVDPSOHVZHUHVHOHFWHGIURP to understand their motivations and initiatives.
D WRWDO RI  WH[WLOH DQG 50* IDFWRULHV 7KH
selected factories are situated in nine districts of 7KLUGVHYHQIRFXVJURXSGLVFXVVLRQV )*'V ZHUH
%DQJODGHVK )LJXUH 7KHVXUYH\IROORZHGWKH organised in factories of Dhaka and Chattogram
FODVVLߔFDWLRQ IURP WKH 6XUYH\ RI 0DQXIDFWXULQJ GLVWULFWV 3DUWLFLSDQW RI WKH )*'V LQFOXGHG
,QGXVWULHV 60,   E\ %DQJODGHVK %XUHDX RI IDFWRU\ RZQHUV VHQLRU PDQDJHUV VXVWDLQDELOLW\
6WDWLVWLFV %%6  ZKLFK FDWHJRULVHV IDFWRULHV DV PDQDJHUVHQYLURQPHQWDORIߔFHUVIDFWRU\ZRUNHUV
IROORZV PLFUR IDFWRULHV KDYH  HPSOR\HHV and supervisors, and industry experts.
VPDOO DQG PHGLXP IDFWRULHV KDYH 
HPSOR\HHVDQGODUJHIDFWRULHVKDYHRUPRUH )RXUWK WZR DGGLWLRQDO H[SHUW JURXS PHHWLQJV
HPSOR\HHV %%6  (*0V  ZHUH RUJDQLVHG WR YDOLGDWH WKH VWXG\
ߔQGLQJV DQG UHFHLYH IHHGEDFN 7KH SDUWLFLSDQWV
Second, the study conducted key informant RI WKHVH (*0V LQFOXGHG RZQHUV DQG RIߔFLDOV RI
LQWHUYLHZV .,,V WRHOLFLWLQIRUPDWLRQDQGLQVLJKWV textile and RMG factories, and representatives
RIVWDNHKROGHUVRIWKHVHFWRU6HPLVWUXFWXUHG.,,V from brands and buyers.

‫ٿ‬

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Securing Green Transition of the Textile and RMG Sector

3. Analytical Framework of the The current study is about greening the industry.
To elaborate, by greening the industry, it is meant
Study
that industrial production and development that
does not come at the expense of the health of
'HߔQLQJJUHHQLQGXVWU\
natural systems or lead to adverse human health
outcomes. It includes commitment to and action on
,Q WKH SDUODQFH RI JUHHQ LQGXVWULDOLVDWLRQ WZR
reducing the environmental impacts of industrial
concepts are used - greening of industries and
processes and products by improving production
green industries. Greening of industries imply the
HIߔFLHQF\HQKDQFLQJHQYLURQPHQWDOSHUIRUPDQFH
commitment of industries to reduce environmental
DQGPLQLPLVLQJKHDOWKULVNV 81,'2 *UHHQ
impacts of their production processes and
industrialisation is essential for achieving a green
products. This is done through resource
JURZWK ZKLFK IROORZV D SDWK RI HFRQRPLF JURZWK
HIߔFLHQF\HQYLURQPHQWDOO\VRXQGPDQDJHPHQWRI
by using natural resources in a sustainable
FKHPLFDOV ZDVWH PDQDJHPHQW UHSODFLQJ IRVVLO
PDQQHU ,W LPSOLHV IRVWHULQJ HFRQRPLF JURZWK
IXHOV E\ UHQHZDEOH HQHUJ\ DQG HFRGHVLJQ RI
DQG GHYHORSPHQW ZKLOH HQVXULQJ WKDW QDWXUDO
SURGXFWV *UHHQ LQGXVWULHV DUH WKRVH ZKLFK DUH
assets continue to provide the resources and
basically industries in the environmental goods
HQYLURQPHQWDOVHUYLFHVRQZKLFKZHOOEHLQJUHOLHV
and services sector. These industries manufacture
2(&'   6R WKH SHUVSHFWLYH RI WKLV VWXG\
clean technologies to achieve environmental
LV WR ORRN DW JUHHQLQJ DV D KROLVWLF YLHZ ZKHUH
REMHFWLYHV 81,'2 

Figure 3.1: ,ŽůŝƐƟĐǀŝĞǁŽĨ'ƌĞĞŶŝŶŐ/ŶĚƵƐƚƌŝĞƐ

Economic
Benefits

• Increase in productivity
• Increase in innovation

Environmental Social
Benefits Benefits

• Efficient resource use • Employment generation


• Less waste & pollution • Socio-economic
• Less consumption of energy empowerment
• Proper management of • Good health
hazardous chemicals

^ŽƵƌĐĞ͗ ƵƚŚŽƌ͛ƐŝůůƵƐƚƌĂƟŽŶ͘

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Securing Green Transition of the Textile and RMG Sector

Figure 3.2: Pathways of Greening of Industries

Greening Industries

Resource Efficiency Chemical &


Energy
Pollution Control & Waste
Management
Cleaner Production Management

Industrial Industrial
Energy Chemical
Efficiency Management

Hazardous
Renewable
Waste
Energy
Management

Source: Adapted from UNIDO (2011) and Luken and Clarence-Smith (2019).

JUHHQLQJRILQGXVWULHVZLOOKDYHEHQHߔWVRQWKUHH aforementioned BBS categorisation. The minimum


streams–economic, social, and environmental. QXPEHU RI ZRUNHUV LQ ODUJH IDFWRULHV LV  DQG
7KLVLVLOOXVWUDWHGLQ)LJXUHEHORZ WKH PD[LPXP LV  )RU VPDOO DQG PHGLXP
factories, and micro factories, the minimum
*UHHQLQJ RI LQGXVWULHV UHTXLUHV DSSURSULDWH QXPEHURIZRUNHUVLVDQGUHVSHFWLYHO\)RU
SROLFLHV LQ IRXU EURDG DUHDV L  SROOXWLRQ FRQWURO the same categories of factories, the maximum
LL  UHVRXUFH HIߔFLHQF\ DQG FOHDQHU SURGXFWLRQ QXPEHURIZRUNHUVLVDQGUHVSHFWLYHO\
5(&3  WKDW FRQVLGHUV SURGXFWLRQ HIߔFLHQF\
environmental management, and human :KHQ FDWHJRULVHG WLHUZLVH  SHU FHQW RI
GHYHORSPHQW LLL  HQHUJ\ PDQDJHPHQW DQG LY  the RMG factories fall under tier 11. These are
FKHPLFDO ZDVWH PDQDJHPHQW )LJXUH  VKRZV large factories located in the Export Processing
the components of greening industries. In order =RQHV (3=V  DQG KDYH GLUHFW FRQWDFW ZLWK WKH
to implement these, various government policies IRUHLJQEX\HUV7KHVKDUHRIWLHU50*IDFWRULHV
DUHUHTXLUHG LV  SHU FHQW /RFDWHG RXWVLGH WKH (3=V
these factories are large and medium in size,
)ROORZLQJ WKH DERYH IUDPHZRUN WKLV VWXG\ SXWV DQGKDYHGLUHFWUHODWLRQVZLWKWKHIRUHLJQEX\HUV
IRUZDUG NH\ ߔQGLQJV RQ LQLWLDWLYHV WDNHQ E\ WKH $ ODUJH VKDUH  SHU FHQW  RI 50* IDFWRULHV
IDFWRULHVZKDWPRUHLVQHHGHGZKDWFKDOOHQJHV IDOOV XQGHU WLHU  ZKLFK DUH ORFDWHG RXWVLGH WKH
GRWKH\IDFHDQGKRZWKRVHFDQEHRYHUFRPH EPZs and of various sizes including medium to
small and micro, and they do not have any direct
4. General Information of OLQN ZLWK IRUHLJQ EX\HUV 7LHUZLVH GLVWULEXWLRQ RI
Factories: Size, Location, VXUYH\ IDFWRULHV LV SUHVHQWHG LQ $QQH[ )LJXUH
$ )LJXUH  SUHVHQWV WKH GLVWULEXWLRQ RI
Green Certificates factories by industry, and size.

$PRQJ WKH VXUYH\HG IDFWRULHV  SHU FHQW


DUHODUJHSHUFHQWDUHVPDOODQGPHGLXP
1
7LHU FODVVL¹FDWLRQ ZDV IROORZHG E\ .KDQ  :LFKWHULFK  
3OHDVHVHHIRUGHWDLOVKWWSVJOREDOODERXUXQLYHUVLW\RUJZSFRQWHQW
DQG  SHU FHQW DUH PLFUR LQ VL]H DV SHU WKH XSORDGV¹OHDGPLQ*/8B:RUNLQJB3DSHUV*/8B:3B1RSGI

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Securing Green Transition of the Textile and RMG Sector

Figure 4.1: ŝƐƚƌŝďƵƟŽŶŽĨ&ĂĐƚŽƌŝĞƐďLJ/ŶĚƵƐƚƌLJĂŶĚ^ŝnjĞ

A. Number of Textile and RMG Factories B. Distribution of Total Factories by Size

250
221
20.60%
200 182
58.31%

150

100

21.09%
50

0
RMG Textile Large Medium and Small Micro

C. Distribution of Factories by Textile and RMG Industries

159.00
160.00

120.00

69.00 83.13
76.00 67.66
80.00
56.47
48.00 43.53
37.00 32.34
40.00
14.00 16.87

0.00
Number % Number % Number %
Large Factories Medium and Small Factories Micro Factories

RMG Textile

^ŽƵƌĐĞ͗ ĂůĐƵůĂƚĞĚĨƌŽŵƚŚĞW'ƌĞĞŶdƌĂŶƐŝƟŽŶ^ƚƵĚLJƐƵƌǀĞLJĚĂƚĂ͘

Practices of greening factories and VXVWDLQDEOHSUDFWLFHVWRFRPSO\ZLWKHQYLURQPHQWDO


motivation UHTXLUHPHQWVDQGFHUWLߔFDWLRQE\WKHLQWHUQDWLRQDO
EX\HUV7KHVHHQYLURQPHQWDOFHUWLߔFDWLRQVLQFOXGH
The current study analysed some features of %&,%6&,*276+LJJ,QGH[6HGH[DQG2(.2
WKHJUHHQFHUWLߔHGIDFWRULHV$PRQJWKHODUJH TEX, etc. Among the surveyed factories that
IDFWRULHV WKDW ZHUH VXUYH\HG  SHU FHQW DUH DFKLHYHG WKHVH HQYLURQPHQWDO FHUWLߔFDWLRQV WKH
JUHHQFHUWLߔHGDQGSHUFHQWRIWKHIDFWRULHV KLJKHVW SHUFHQWDJH  SHU FHQW  RI IDFWRULHV
KDYH DSSOLHG IRU JUHHQ FHUWLߔFDWLRQ ZKLOH  achieved Sedex. The second highest percentage
per cent of the large factories in the sample do RIFHUWLߔFDWLRQFDWHJRU\LV2(.27(;ZLWK
QRW KDYH JUHHQ FHUWLߔFDWLRQ +RZHYHU DPRQJ SHUFHQWDQG2&6ZLWKHTXDOSHUFHQWDJH $QQH[
WKH QRQJUHHQ FHUWLߔHG IDFWRULHV PDQ\ IROORZ Table A4.1).

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Securing Green Transition of the Textile and RMG Sector

Figure 4.2: &ĂĐƚŽƌŝĞƐ͛<ŶŽǁůĞĚŐĞĂďŽƵƚ'ƌĞĞŶĞƌƟĮĐĂƟŽŶ

17.50%

15.03%
80.70%

3.00%
Overall Large Factories Small & Medium Micro Factories
Factories

Source: ĂůĐƵůĂƚĞĚĨƌŽŵƚŚĞW'ƌĞĞŶdƌĂŶƐŝƟŽŶ^ƚƵĚLJƐƵƌǀĞLJĚĂƚĂ͘

,Q WHUPV RI DZDUHQHVV DQG NQRZOHGJH ODUJH NH\ UHDVRQV IRU VXFK YDULDWLRQV LQ NQRZOHGJH
IDFWRULHV DUH PRUH DZDUH RI JUHHQ FHUWLߔFDWLRQ DERXWJUHHQFHUWLߔFDWHV
than the others. Micro-sized factories are much
OHVVDZDUH )LJXUH 'XULQJWKH)*'VDQG.,,V Overall, self-motivation, market-driven factors,
ZLWKIDFWRU\RZQHUVDQGPDQDJHUVLWZDVUHYHDOHG VXFK DV EX\HU UHTXLUHPHQWV DQG D GHVLUH IRU
that factors such as access to information, EHFRPLQJ FRPSHWLWLYH DUH WKH PDMRU UHDVRQV IRU
UHVRXUFHV IRU FHUWLߔFDWLRQ DQG RYHUDOO FDSDFLW\ IDFWRULHVWRREWDLQJUHHQFHUWLߔFDWLRQ 7DEOH 
to adopt environmentally compliant practices are 7KLVLPSOLHVWKDWWKHUHH[LVWVDZLOOLQJQHVVDPRQJ

Table 4.1: Motivations for Obtaining Green Certificate

Reasons Factories with Green Factories that do not have


certificate Green certificate but want
to obtain in the future
Frequency % of Cases Frequency % of Cases
Self-motivation    
%X\HUV‫ڕ‬5HTXLUHPHQW 19  16 
Sustainability Practice    
To Become More Competitive    
Marketing Strategy    
%X\HUV‫ڕ‬,QߕXHQFH    
Government Environmental Regulations    
)ROORZLQJ2WKHU)DFWRU\([DPSOHV 1   
Others - - 4 

Source: Calculated from the CPD Green Transition Study survey data.
Note:6LQFHPXOWLSOHUHVSRQVHVZHUHDFFHSWHGWKHVXPRIWKHVKDUHVFRXOGEHJUHDWHUWKDQ

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Securing Green Transition of the Textile and RMG Sector

factories to voluntarily embrace sustainable are for energy conservation technologies,


SUDFWLFHV DQG DOLJQ ZLWK PDUNHW GHPDQGV IRU UHQHZDEOH HQHUJ\UHODWHG WHFKQRORJLHV EXLOGLQJ
environmentally friendly processes. In case of level energy meter, building level ZDWHU PHWHU
WKH QRQJUHHQ FHUWLߔHG IDFWRULHV WKH UHDVRQV WR technologies for air pollution control, dust control,
REWDLQJUHHQFHUWLߔFDWHLQFOXGHWKHLUFRPPLWPHQW VROLG ZDVWH PDQDJHPHQW DQG ZDVWHZDWHU
to sustainability, demand from buyers, and a PDQDJHPHQW )LJXUH 
UHFRJQLWLRQ RI WKH PDUNHWLQJ EHQHߔWV DVVRFLDWHG
ZLWK WKH JUHHQ FHUWLߔFDWLRQ ,W LV QRWDEOH WKDW The survey data analysis indicates that small and
the government regulations on environmental medium and micro-sized factories have a greater
VWDQGDUGV DSSHDU WR KDYH D UHODWLYHO\ ZHDNHU reliance on grid electricity compared to the large
LQߕXHQFHRQWKHGHFLVLRQVRIERWKJUHHQFHUWLߔHG factories. Small and medium-sized factories
DQGQRQJUHHQFHUWLߔHGIDFWRULHV GHSHQG RQ WKH JULG IRU DERXW  SHU FHQW RI
WKHLUHOHFWULFLW\FRQVXPSWLRQZKLOHPLFURIDFWRULHV
5. Green Measures Undertaken UHO\RQLWIRUDSSUR[LPDWHO\SHUFHQWRIWKHLU
by Factories SRZHUFRQVXPSWLRQ7KLVLQIRUPDWLRQLVSUHVHQWHG
LQ)LJXUH

Where are the factories investing


6LPLODUO\ 7LHU  50* IDFWRULHV KDYH WKH KLJKHVW
and how much? GHSHQGHQF\ RQ JULG HOHFWULFLW\  SHU FHQW 
7KLV LV IROORZHG E\ 7LHU 
Figure 5.1: 'ƌĞĞŶ/ŶǀĞƐƚŵĞŶƚŽĨ&ĂĐƚŽƌŝĞƐŝŶsĂƌŝŽƵƐ'ƌĞĞŶŝŶŐWƌĂĐƟĐĞƐ IDFWRULHV ZKLFK XVH  SHU
cent other their electricity from
Energy
the grid, and Tier 1 factories
WKDW XVH  SHU FHQW RI
• Energy Conservation Technology WKHLU UHTXLUHPHQW IURP JULG
• Renewable Energy Technology electricity.

Building Level Energy Meter

)DFWRULHV KDYH LQYHVWHG IRU


Water adoption of technologies for
conservation of energy and
• Building Level Water Meter ZDWHU DLU SROOXWLRQ FRQWURO
DQG ZDVWH PDQDJHPHQW
Irrespective of their sizes or
Air greening status, factories
• Air Pollution Control Technology have made some investment
• Dust Pollution Control Technology WRZDUGV JUHHQLQJ 7KH VKDUH
RI IDFWRULHV ZKLFK PDGH
LQYHVWPHQW WRZDUGV JUHHQLQJ
Waste Management Technology
GXULQJ WKH ODVW ߔYH \HDUV ZDV
• Solid Waste Management PRUHWKDQSHUFHQWLQWKH
• Wastewater Management FDVHRIODUJHIDFWRULHVSHU
cent in the case of small and
PHGLXP IDFWRULHV DQG 
Source: ƵƚŚŽƌƐ͛ŝůůƵƐƚƌĂƟŽŶďĂƐĞĚŽŶƚŚĞW'ƌĞĞŶdƌĂŶƐŝƟŽŶ^ƵƌǀĞLJĂŶĂůLJƐŝƐ͘
per cent for micro factories
$QQH[7DEOH$ 

)DFWRULHVDUHLQYHVWLQJIRUJUHHQLQJLQDUHDVVXFK 
7KLV LV D V\VWHP WR VXSSRUW UHVRXUFH PDQDJHPHQW DQG LGHQWLI\
DVHQHUJ\ZDWHUDLUDQGZDVWHPDQDJHPHQWE\ RSSRUWXQLWLHVIRUDGGLWLRQDOUHVRXUFHVDYLQJVE\WUDFNLQJEXLOGLQJ
ZD\RIWHFKQRORJ\XSJUDGDWLRQ7KHLULQYHVWPHQWV OHYHOUHVRXUFHXVH)RUPRUHGHWDLOVSOHDVHVHHKWWSVZZZXVJEF
RUJFUHGLWVFRUHDQGVKHOOYGUDIWHDS

3DJH_
Securing Green Transition of the Textile and RMG Sector

Figure 5.2: Average Use of Electricity in a Month by Factories

• Average 16,068.98 MWh of Total Electricity Use


Large • Average 8,562.56 MWh from Grid Electricity (65.12% of Average Total Electricity Use)
Factories

• Average 53.06 MWh of Total Electricity Use


Small and • Average 40.25 MWh from Grid Electriciy (86.59% of Average Total Electricity Use)
Medium
Factories

• Average 9.99 MWh of Total Electricity Use


Micro • Average 8.38 MWh from Grid Electricity (93.35% of Average Total Electricity Use)
Factories

Source: ĂůĐƵůĂƚĞĚĨƌŽŵƚŚĞW'ƌĞĞŶdƌĂŶƐŝƟŽŶ^ƚƵĚLJƐƵƌǀĞLJĚĂƚĂ͘

)RU ODUJH IDFWRULHV DYHUDJH JUHHQ LQYHVWPHQW UHVSHFWLYHO\ )LJXUH $OWKRXJKWKHYROXPHRI


GXULQJODVWߔYH\HDUVZDV%'7PLOOLRQZKLFK green investment by small and medium, and micro
LV  SHU FHQW RI WKHLU WRWDO LQYHVWPHQW )RU IDFWRULHVLVORZHUFRPSDUHGWRODUJHIDFWRULHVWKH
small and medium factories, and micro factories, share of green investment in their total investment
DYHUDJH JUHHQ LQYHVWPHQW GXULQJ WKH ODVW ߔYH is higher than that of the large factories.
\HDUVZDV%'7PLOOLRQDQG%'7PLOOLRQ

Figure 5.3: Source of Electricity Use by RMG Factories in Tier Groups

40.83% Electricity 57.05% 76.94%


from GRID Electricity from Electricity from
GRID GRID

Tier 1 Factories Tier 2 Factories Other Factories including Tier 3

Source: ĂůĐƵůĂƚĞĚĨƌŽŵƚŚĞW'ƌĞĞŶdƌĂŶƐŝƟŽŶ^ƚƵĚLJƐƵƌǀĞLJĚĂƚĂ͘

3DJH_
Securing Green Transition of the Textile and RMG Sector

Figure 5.4: Factory Groupwise Average Green Investment in Last Five Years

Large Factories

BDT 78.07 Million 36.98% of Total Investment

Small and Medium Factories

BDT 1.37 Million 44.84% of Total Investment

Micro Factories

BDT 0.16 Million 53.99% of Total Investment

Source: ĂůĐƵůĂƚĞĚĨƌŽŵƚŚĞW'ƌĞĞŶdƌĂŶƐŝƟŽŶ^ƚƵĚLJƐƵƌǀĞLJĚĂƚĂ͘

7KURXJKWKH.,,VLWZDVUHYHDOHGWKDWPRVWJUHHQ WHFKQRORJLHV ,QDGHTXDWH NQRZOHGJH UHJDUGLQJ


EXLOGLQJ FHUWLߔHG IDFWRULHV XVH DPRQJ RWKHUV W\SH DQG DYDLODELOLW\ RI JUHHQ WHFKQRORJLHV ZDV
solar panels, metering system to monitor and also mentioned as a considerable challenge.
HIߔFLHQWO\ XVH HOHFWULFLW\ /(' OLJKWEXOEV VHUYR 'XULQJWKH.,,VLWZDVDOVRPHQWLRQHGWKDWWKHUHLV
PRWRUVH[KDXVWIDQVUDLQZDWHUKDUYHVWLQJZDWHU a shortage of skilled human resource to maintain
UHF\FOLQJ WHFKQRORJLHV DQG HIߕXHQW WUHDWPHQW the technology.
plants (ETPs). Curiously, despite not being
FHUWLߔHGPRVWQRQJUHHQFHUWLߔHGIDFWRULHVGHSOR\ 6. Social Aspects of Greening
YDULRXV HQYLURQPHQWIULHQGO\ WHFKQRORJ\ DV ZHOO Factories
+RZHYHU WKH YDULHW\ DQG H[WHQW RI WHFKQRORJ\
use depend on factors including industry type and $ WRWDO RI  ZRUNHUV ZHUH LQWHUYLHZHG IURP
factory size. While massive undertakings such the surveyed factories. The gender distribution
DV UDLQZDWHU KDUYHVWLQJ ZDWHU UHF\FOLQJ V\VWHP RI ZRUNHUV YDULHV VLJQLߔFDQWO\ EHWZHHQ WKH 50*
and ETPs can be mostly found in large factories, and the textile industry. It also varies according to
solar panels, LED bulbs, exhaust fans, etc. can IDFWRU\ VL]HV ,Q WKH ODUJH 50* IDFWRULHV 
be found in both larger and smaller factories. SHU FHQW RI WKH UHVSRQGHQWV ZHUH IHPDOH DQG
 SHU FHQW ZHUH PDOH UHVSRQGHQWV $QQH[
'XULQJWKH.,,VWKHIDFWRU\RZQHUVDQGPDQDJHUV Table A6.1).
PHQWLRQHGVDIHDQGKHDOWK\ZRUNLQJHQYLURQPHQW
IRUHPSOR\HHVORZHUHQHUJ\ELOOVDQGFRVWVDYLQJV The textile industry reveals a different pattern in
reduced environmental impact, increased brand terms of gender representation. In the large textile
value and reputation, and increased customer factories, the share of female respondents is
LQWHUHVW DV SRWHQWLDO EHQHߔWV RI DGRSWLQJ JUHHQ SHUFHQWDQGWKHVKDUHRIPDOHUHVSRQGHQWV
WHFKQRORJLHV ,W ZDV DOVR PHQWLRQHG WKDW EHWWHU LV  SHU FHQW )DFWRUV VXFK DV WKH QDWXUH RI
ventilation and temperature management ZRUNIDFWRU\VL]HORFDWLRQDQGLQGXVWU\VSHFLߔF
SRVLWLYHO\ LPSDFWV ZRUNHUV‫ ڕ‬SURGXFWLYLW\ $W WKH dynamics may contribute to these differences in
same time, higher initial investment costs, ongoing JHQGHUUHSUHVHQWDWLRQDPRQJWKHZRUNHUV
maintenance and management costs, reduced
SURߔWPDUJLQVDQGFKDOOHQJHVLQDGDSWLQJWRQHZ It is evident from the survey that the age group of
WHFKQRORJLHV DQG SURFHVVHV ZHUH SHUFHLYHG WR \HDUVFRPSULVHVDVLJQLߔFDQWSRUWLRQRIWKH
EHPDMRUEDUULHUVDVVRFLDWHGZLWKDGRSWLQJJUHHQ

Page | 9
Securing Green Transition of the Textile and RMG Sector

Figure 6.1: ŐĞ'ƌŽƵƉŝƐƚƌŝďƵƟŽŶŽĨƚŚĞtŽƌŬĞƌƐ

1400 35

1200 30
Number of Workers

1000 25

Percentage
800 20

600 15

400 10

1063
1178
200 5
281
219

681
489
192

790
388

744
319
624
482
142
395
306

319
282
62

89

37
0 0
17 or 18–20 21–25 26–30 31–35 36–40 41 or
younger older
All Worker Male Worker Female Worker
All Worker % Male Worker % Female Worker %

Source: ĂůĐƵůĂƚĞĚĨƌŽŵƚŚĞW'ƌĞĞŶdƌĂŶƐŝƟŽŶ^ƚƵĚLJƐƵƌǀĞLJĚĂƚĂ͘

VXUYH\HG ZRUNHUV ZLWK WKH PDMRULW\ LQ WKH  Productivity and sickness of
\HDUVUDQJH7KHFRQFHQWUDWLRQRIIHPDOHZRUNHUV workers
LVPRVWO\LQWKHDQGDJHJURXSVZKLOH
WKDW RI PDOH ZRUNHUV IROORZV D VLPLODU SDWWHUQ Workers in large factories have a higher likelihood
)LJXUH  SUHVHQWV WKH GLVWULEXWLRQ RI ZRUNHUV of meeting their daily production targets. A larger
by age and gender. This information can be SHUFHQWDJHRIZRUNHUVUHSRUWHGWKDWWKH\‫ڔ‬RIWHQ‫ڕ‬RU
valuable for understanding the demographics of ‫ڔ‬DOZD\V‫ڕ‬PHHWWKHLUSURGXFWLRQWDUJHWV7KLVFRXOG
WKHZRUNIRUFHLQWKHVWXGLHGLQGXVWULHV be because of a combination of factors such as

Table 6.1: How Often Do the Workers Meet Their Daily Production Target

Response Large Factories Small and Medium Micro Factories Total


Factories
1HYHU 1   1 1 
(%)    
5DUHO\ 1  1 6 9
(%)    
6RPHWLPHV 1    
(%)    
Often    
1     
$OZD\V 1    
(%)    
7RWDO 1  116  
Source: Calculated from the CPD Green Transition Study survey data.

3DJH_
Securing Green Transition of the Textile and RMG Sector

Table 6.2: Workers’ Absence in The Last Month Due to Sickness

Yes N/ (%) No N/(%) Total N/(%)


/DUJH)DFWRULHV   
  
6PDOODQG0HGLXP)DFWRULHV  119 
(61.49)  
0LFUR)DFWRULHV   
  
Total   
  
Source: Calculated from the CPD Green Transition Study survey data.

PRGHUQ WHFKQRORJ\ VNLOOHG ZRUNHUV DQG EHWWHU 7. Barriers for Greening


ZRUNLQJ HQYLURQPHQW LQFOXGLQJ HQYLURQPHQWDOO\
Factories
friendly environment (Table 6.1).
7KH SUHVHQW VWXG\ LGHQWLߔHV IRXU PDMRU W\SHV
:RUNHUVLQODUJHIDFWRULHVDOVRWHQGWRKDYHORZHU
of barriers that factories in the textile and RMG
DEVHQFH UDWH GXH WR VLFNQHVV ZKLOH ZRUNHUV LQ
VHFWRUV IDFH ZKLOH HPEDUNLQJ RQ WKHLU MRXUQH\
small and medium-sized, and micro factories
WRZDUGV JUHHQ WUDQVLWLRQ 7KHVH DUH L  SROLF\
have higher absence rates due to illness (Table
and regulatory barriers, (ii) institutional barriers,
  :KLOH WKH VLFNQHVV FDQQRW EH DWWULEXWHG
(iii) factory level barriers, and (iv) market-related
VROHO\WRWKHZRUNSODFHHQYLURQPHQWLWPD\KDYH
EDUULHUV 7KHVH EDUULHUV DUH EULHߕ\ GLVFXVVHG
some connections.
EHORZ

$PRQJ WKH VXUYH\HG ZRUNHUV  SHU FHQW RI


WKRVH ZRUNLQJ LQ ODUJH IDFWRULHV EHOLHYH JUHHQ
Policy and regulatory barriers
SUDFWLFHV EULQJ EHQHߔWV IRU WKHP $URXQG 
• Lack of harmonisation in policies and
SHUFHQWRIWKHZRUNHUVLQVPDOODQGPHGLXPVL]HG
regulations: The Government of Bangladesh
IDFWRULHV DQG  SHU FHQW RI ZRUNHUV LQ PLFUR
has mentioned considerable initiatives in its
IDFWRULHV VKDUH WKH VDPH EHOLHI 7KH ZRUNHUV
national development policy and plan, and
reported reduced health hazard, reduced medical
HQDFWHGVHYHUDOODZVDQGUHJXODWLRQVUHODWHGWR
cost, and improved productivity as the top three
climate change mitigation and adaptation, and
EHQHߔWV DVVRFLDWHG ZLWK JUHHQ SUDFWLFHV ZLWKLQ
SROOXWLRQFRQWURO *('0R()&&
WKHIDFWRULHV0RUHWKDQSHUFHQWRIWKHRZQHUV
0R()&&   +RZHYHU VSHFLߔF SROLF\
DQGPDQDJHUVRSLQHGWKDWSURGXFWLRQHIߔFLHQF\RI
options and strategic direction for managing
WKH ZRUNHUV ZLOO LQFUHDVH GXH WR JUHHQ WUDQVLWLRQ
climate and environmental challenges that
RIWKHLUIDFWRULHV,WZDVPHQWLRQHGGXULQJWKH.,,V
account for both the green transition of
that green factories prioritise the health and safety
industrial sector in Bangladesh and economic
of their employees by implementing measures
JURZWKLQDKDUPRQLVHGZD\LVPLVVLQJ *('
VXFK DV LPSURYHG DLU TXDOLW\ UHGXFHG QRLVH
 
pollution, and sustainable practices. This leads to
DPRUHSOHDVDQWDQGSURGXFWLYHZRUNHQYLURQPHQW
and reduced absenteeism and turnover rates.

Page | 11
Securing Green Transition of the Textile and RMG Sector

)RU LQVWDQFH WKH UHFHQWO\ SXEOLVKHG 0XMLE VXVWDLQDEOHSUDFWLFHV7KHDEVHQFHRIVSHFLߔF


Climate Prosperity Plan (MCPP) recognises HQYLURQPHQWDO JRDOV KDV OHG WR LQVXIߔFLHQW
the Leadership in Energy and Environmental implementation of regulations, for instance,
'HVLJQ /(('  FHUWLߔFDWLRQ DV D JUHHQ WKHLQDGHTXDWHLPSOHPHQWDWLRQRIHQYLURQPHQW
accreditation for export-oriented industries SURWHFWLRQ VXUFKDUJH ,Q WKH (LJKWK )LYH<HDU
OLNH MXWH OHDWKHU WH[WLOHV DQG LQIRUPDWLRQ 3ODQ )<3 DJRDOZDVVHWWRLPSOHPHQWWKH
WHFKQRORJ\ ,7 VHUYLFHV:LWKLQWKHIUDPHZRUN SROOXWHUSD\VSULQFLSOHLQSHUFHQWRIFDVHV
of the green export program, the plan has E\  DQG  SHU FHQW RI FDVHV E\ 
VHW D JRDO RI DFKLHYLQJ  SHU FHQW /((' 1HYHUWKHOHVV WKHUH LV QR VSHFLߔF PHQWLRQ RI
FHUWLߔFDWLRQ IRU VWUDWHJLFDOO\ VLJQLߔFDQW H[SRUW WKH PHWKRGV RU PHFKDQLVPV WKURXJK ZKLFK
LQGXVWULHVE\+RZHYHUWKLVWDUJHWGRHV WKLVJRDOZLOOEHDWWDLQHG
QRW DOLJQ ZLWK RWKHU JRYHUQPHQW SODQV VXFK
DVWKH3HUVSHFWLYH3ODQRI%DQJODGHVK  Additionally, more policy support and
 DQGWKH1DWLRQDO$GDSWDWLRQ3ODQ  incentives for encouraging investment in
 )XUWKHUPRUHLWLVLPSRUWDQWWRQRWHWKDW ODUJHVFDOH UHQHZDEOH HQHUJ\ JHQHUDWLRQ
/(('FHUWLߔFDWLRQDORQHGRHVQRWHQFRPSDVV must be provided. These factors pose
all the aspects for making industries more VLJQLߔFDQW REVWDFOHV WR D VPRRWK WUDQVLWLRQ
environmentally friendly, as it may not be IURPWUDGLWLRQDOWRUHQHZDEOHHQHUJ\LPSHGLQJ
suitable or necessary for certain sectors, progress in the green transition of the textile
such as textiles. Therefore, there is a need for and RMG sectors. Improving sustainable
greater harmonisation and consistency among practices can be enhanced by the presence
policies. of green practice regulations tailored to small,
medium, and micro-sized factories.
Also, there is an obvious absence of
UHJXODWRU\ PHFKDQLVPV ZLWKLQ HQYLURQPHQWDO • Regulatory and policy uncertainty for
and industrial policies to address critical energy security: Regulatory and policy
FRQFHUQV UHODWHG WR VXUIDFH DQG JURXQGZDWHU uncertainty for energy security presents a
PDQDJHPHQW DV ZHOO DV WKH VDIH GLVSRVDO RI VLJQLߔFDQW FKDOOHQJH IRU IDFWRULHV ZKHQ LW
KD]DUGRXV DQG WR[LF ZDVWH DQG SURSHU ODQG comes to planning and making long-term
management. To illustrate, there is currently investments for green energy sources. This
no established pricing policy for the industrial XQFHUWDLQW\ LV HVSHFLDOO\ SHUWLQHQW ZKHQ LW
XWLOLVDWLRQ RI JURXQGZDWHU 7KH FRQVHTXHQW involves regulations that prioritise traditional
XQUHVWULFWHG XVH RI JURXQGZDWHU LV OHDGLQJ fossil fuel dominant energy mix, as it can
WR D VLJQLߔFDQW GHFUHDVH LQ VXUIDFH ZDWHU discourage factories from venturing into green
levels in numerous densely industrialised energy.
areas, including Dhaka, Gazipur, and
Mymensingh. The need for coordination and In the context of Bangladesh, the historical
the implementation of regulatory tools to UHOLDQFH RQ IRVVLO IXHOV KDV EHHQ D GHߔQLQJ
effectively confront these environmental and FKDUDFWHULVWLF RI LWV HQHUJ\ VHFWRU )RVVLO
industrial challenges cannot be overstated. fuels, including coal, natural gas, and oil, have
traditionally played a central role in meeting the
• Absence of specific environmental goals country’s energy demands. Regulations and
in policies and regulatory frameworks: policies designed to support and incentivise
Bangladesh’s textile and RMG industry needs these industries may take the form of subsidies
PRUHVSHFLߔFDQGGHߔQHGJRDOVLQSROLFLHVDQG WKDW ORZHU WKH FRVW RI IRVVLO IXHO WD[ EHQHߔWV
UHJXODWRU\ IUDPHZRUNV WR DGRSW VXVWDLQDEOH WKDW UHGXFH WKH ߔQDQFLDO EXUGHQ RQ WKHVH
practices. The existing environmental industries, or environmental standards that
PRQLWRULQJ DQG UHJXODWRU\ IUDPHZRUN QHHGV may not be as stringent as those promoting
WR FOHDUO\ GHߔQH JRDOV IRU IDFWRULHV WR IROORZ greener alternatives.

3DJH_
Securing Green Transition of the Textile and RMG Sector

In a policy and regulatory environment that As a result, many factories go unchecked,


IDYRXUV IRVVLO IXHOV IDFWRULHV RSHUDWLQJ ZLWKLQ and violations often go unnoticed. Even
WKLV IUDPHZRUN PLJKW KDYH OLPLWHG PRWLYDWLRQ ZKHQ YLRODWLRQV DUH LGHQWLߔHG SHQDOWLHV IRU
to invest in cleaner and more sustainable non-compliance may be relatively minor
WHFKQRORJLHV 7KH LPPHGLDWH ߔQDQFLDO or inconsistently applied. This can lead
advantages offered by the current system VRPH IDFWRU\ RZQHUV WR YLHZ WKH SHQDOWLHV
FDQ RYHUVKDGRZ WKH SRWHQWLDO EHQHߔWV RI as a cost of doing business rather than an
transitioning to green energy solutions. This LQFHQWLYH IRU VXVWDLQDELOLW\ &RQVHTXHQWO\
KHVLWDQF\WRVKLIWWRZDUGVJUHHQHUWHFKQRORJLHV numerous factories engaged in processes
SHUVLVWV HYHQ ZKHQ WKHVH DOWHUQDWLYHV KDYH VXFK DV ZDVKLQJ DQG G\HLQJ FODVVLߔHG DV
the potential to be more cost-effective and “red” industries) often display reluctance in
environmentally responsible in the long term. RSHUDWLQJWKHLU(73VHIIHFWLYHO\ZKLFKUHVXOWV
in degradation of environment.
The energy mix argument underscores that
as long as policies and regulations heavily $FFRUGLQJWRWKH.,,VRZQHUVDQGPDQDJHUVRI
favour fossil fuels, the transition to green most of the factories think that the government
energy solutions may face resistance, as UXOHV DQG UHJXODWLRQV DUH D VLJQLߔFDQW IDFWRU
WKH ߔQDQFLDO LQFHQWLYHV LQ SODFH FDQ PDNH in organisations’ green management and
fossil fuels appear more economically viable these rules need to be stringent in the coming
in the short term. To facilitate this transition, GD\V7KH\ZHUHDOVRRIWKHRSLQLRQWKDWZHDN
it’s essential for governments and regulatory implementation of the policies, rules, and
bodies to rebalance incentives and prioritise UHJXODWLRQV VORZ GRZQ WKH JUHHQ WUDQVLWLRQ
environmentally sustainable energy sources. process.

Institutional barriers • Lack of coordination among government


agencies: The lack of coordination and
• Weak regulatory, management, monitoring cooperation among various ministries and
systems, and enforcement: Existing useful government agencies is hindering the
ODZVDQGUHJXODWLRQVUHPDLQOHVVHIIHFWLYHRZLQJ formulation and implementation of synergistic
WR ZHDNQHVVHV LQ UHJXODWRU\ PDQDJHPHQW green industrial policies (Hannan & Aigbogun,
and monitoring system and enforcement.  $VDQH[DPSOHWKHPDQDJHPHQWRIVROLG
)DFWRULHV RIWHQ IDLO WR FRPSO\ WR WKHVH UXOHV DQGKD]DUGRXVZDVWHLQ%DQJODGHVKLQYROYHV
and regulations because of lax enforcement the participation of multiple government
DQG DZDUHQHVV UHJDUGLQJ HQYLURQPHQWDO entities, including the DoE, the Ministry of
FRPSOLDQFH UHTXLUHPHQWV $V DQ H[DPSOH Industries, the Ministry of Commerce, and
the Department of Environment (DoE) is ORFDO FLW\ FRUSRUDWLRQV +RZHYHU WKHUH LV D
UHVSRQVLEOHIRUHQIRUFLQJWKHOHJDOUHTXLUHPHQW notable absence of coordination among these
stipulated in the Environmental Conservation DJHQFLHV ZKHQ LW FRPHV WR WKH GLVSRVDO DQG
$FWRI (&$ 7KLVUHTXLUHPHQWPDQGDWHV PDQDJHPHQWRIVROLGDQGKD]DUGRXVZDVWH
that all applicable industrial facilities must
LQVWDOO(IߕXHQW7UHDWPHQW3ODQWV (73V WRWUHDW )RU LQVWDQFH QXPHURXV JDUPHQW DQG WH[WLOH
WKHLU ZDVWHZDWHU WR PHHW VSHFLߔHG VWDQGDUGV factories are located along the eastern banks
before discharging it into the surrounding RI7XUDJ5LYHUZKLFKIDOOVXQGHUWKHMXULVGLFWLRQ
HQYLURQPHQW 1HYHUWKHOHVV WKH HQIRUFHPHQW RIWKH'KDND1RUWK&LW\&RUSRUDWLRQ '1&& 
RIWKLVPDQGDWHSUHVHQWVVLJQLߔFDQWFKDOOHQJHV Currently, the river is suffering because of
due to a shortage of personnel and a lack JUDGXDOEXLOGXSRILQGXVWULDODQGRWKHUZDVWH
RI WHFKQLFDO H[SHUWLVH ZLWKLQ WKH FRQFHUQHG The Bangladesh Inland Water Transport
agency. Authority (BIWTA), responsible for maintaining
the river’s navigability, has faced challenges

3DJH_
Securing Green Transition of the Textile and RMG Sector

LQ WHUPV RI PDQDJLQJ WKH DYDLODEOH ZDWHU DQG YLVXDO DVSHFWV RI WKH ZRUNSODFH UDWKHU
resources and surrounding environment due than the broader environmental impact of
WR WKH ODFN RI FRRSHUDWLRQ EHWZHHQ WKHVH WZR WKHLU ZRUN )LQHWXQLQJ RI WKHVH SHUFHSWLRQV
agencies. This lack of coordination is also DQG SURPRWLQJ JUHDWHU DZDUHQHVV RI WKH
evident among other agencies, primarily due EHQHߔWV RI VXVWDLQDEOH SUDFWLFHV PD\ EH YLWDO
to overlapping mandates. in encouraging broader adoption of green
technologies.
Factory level barriers
• Finance-related constraints: Access to
• Lack of information and awareness: ߔQDQFH LV RQH RI WKH PRVW FLWHG EDUULHUV IRU
Access to information is crucial in driving IDFWRULHV VHHNLQJ HQYLURQPHQWDO FHUWLߔFDWLRQ
ߔUPV‫ ڕ‬JUHHQ LQYHVWPHQW GHFLVLRQV +RZHYHU or adopting green practices. Initiatives such
PDQ\ HQWHUSULVHV QHHG PRUH DZDUHQHVV DQG DV REWDLQLQJ JUHHQ FHUWLߔFDWLRQ UHWURߔWWLQJ
NQRZOHGJH WR LQWHJUDWH VXVWDLQDEOH SUDFWLFHV facilities, implementing sustainable practices,
LQWR WKHLU EXVLQHVV PRGHOV 7KH FHUWLߔFDWLRQ DQGDGRSWLQJJUHHQWHFKQRORJLHVRIWHQUHTXLUH
process can be particularly challenging due KLJK XSIURQW FRVWV ZKLFK FDQ GHWHU IDFWRULHV
to a lack of information. A considerable lack from embracing green initiatives due to the
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managers of large factories are considerably DQG  PD\ SXW WKHP LQ D GLVDGYDQWDJHRXV
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green or environmental-friendly practices in LQWURGXFHG WKH ‫ڔ‬5HߔQDQFH 6FKHPH IRU *UHHQ
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compared to small and medium, and micro loan from commercial banks, implementation
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Page | 14
Securing Green Transition of the Textile and RMG Sector

7KH SHUFHLYHG ߔQDQFLDO ULVN DVVRFLDWHG attempting to make substantial investments in


ZLWK WKHVH LQYHVWPHQWV FDQ GHWHU IDFWRULHV JUHHQLQLWLDWLYHV7KLVGLIߔFXOW\DULVHVIURPWKH
from embracing green initiatives, resulting inherent need for more control over the building
in missed opportunities for cost savings, DQGLWVV\VWHPVWRXQGHUWDNHVLJQLߔFDQWJUHHQ
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performance. control and authority over structural changes
and technology upgrades can be limited, thus
• Limited capacity and capability of factories: impeding the adoption of comprehensive
7KHZLGHYDULDWLRQLQWKHFDSDFLW\RIIDFWRULHV green practices.
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embeddedness of environmental sustainability Moreover, factories that are already established
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particularly performing better in terms of VXVWDLQDEOH VWDQGDUGV 7KH UHWURߔWWLQJ RI
considering environmental sustainability in older facilities to meet these standards can
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related policies, identifying environmental challenging. Adapting existing infrastructure
protection as factories corporate social WRFRPSO\ZLWKQHZHQYLURQPHQWDOUHJXODWLRQV
responsibility. Other factories are lagging and standards often necessitates substantial
FRQVLGHUDEO\ EHKLQG ZKHQ LW FRPHV WR WKHVH LQYHVWPHQWV LQ WHFKQRORJ\ HTXLSPHQW DQG
aspects. IDFLOLW\ PRGLߔFDWLRQV SUHVHQWLQJ D IRUPLGDEOH
barrier to the adoption of green initiatives.
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HYHQ D ‫ڔ‬+HDG RI 6XVWDLQDELOLW\‫  ڕ‬DORQJ ZLWK D
VHSDUDWHHQYLURQPHQWDOFRPSOLDQFHPDQDJHU • Lack of market-driven incentives: The
RIߔFHU ,Q WKH FDVHV RI VPDOOHU IDFWRULHV WKH absence of market-driven incentives can
VLWXDWLRQLVTXLWHGLVPDO'XULQJWKH.,,VLWZDV SRVH D VLJQLߔFDQW EDUULHU WR ߔUPV DGRSWLQJ
DFNQRZOHGJHG WKDW PDMRULW\ RI WKH ZRUNHUV sustainable practices. The survey conducted
GR QRW KDYH VXIߔFLHQW NQRZOHGJH UHJDUGLQJ IRU WKLV VWXG\ IRXQG WKDW ߔUPV ZHUH SULPDULO\
WKH JUHHQLQJ LQLWLDWLYHV ,W ZDV PHQWLRQHG motivated by internal factors and market-
that there is a shortage of skilled human driven incentives rather than external factors
UHVRXUFHV ZKHQ LW FRPHV WR PDLQWDLQLQJ WKH such as regulatory pressure. Thus, the lack
JUHHQLQJUHODWHG WHFKQRORJLHV 7KH RZQHUV RI LQFHQWLYHV FDQ GHPRWLYDWH ߔUPV IURP
and managers often need to rely on foreign WUDQVLWLRQLQJ WR VXVWDLQDEOH SUDFWLFHV )RU
H[SHUWLVHZKHQLPSRUWLQJDQGLQVWDOOLQJVWDWH example, the absence of premium prices for
of-the-art machinery in their factories. The JUHHQSURGXFWVLVDVLJQLߔFDQWEDUULHUWRJUHHQ
)*'VKLJKOLJKWHGWKHLPSRUWDQFHRIHGXFDWLRQ transition in the textile and RMG sector. This
DQG WUDLQLQJ IRU ZRUNHUV WR XQGHUVWDQG WKH discourages factories from investing in green
HQYLURQPHQWDO LPSDFWV RI WKHLU ZRUN DQG WKH production processes, as they may not see
machineries they use. any additional revenue from such investments.
(YHQ LI WKH IDFWRULHV DUH JUHHQ FHUWLߔHG
• Operational barriers: Another set of barriers HQWUHSUHQHXUVPD\PDNHOHVVSURߔWVLQFHWKH
that hinders the adoption of green initiatives prices remain the same.
DUHRSHUDWLRQDOEDUULHUVVXFKDVWKHGLIߔFXOW\
of greening in rented infrastructure or the • Lack of information and expertise on
IDFWRULHV ZKLFK DUH DOUHDG\ HVWDEOLVKHG green technologies: A disparity in access
)DFWRULHVRSHUDWLQJZLWKLQUHQWHGLQIUDVWUXFWXUH to information about green technologies can
PD\ HQFRXQWHU FRQVLGHUDEOH KXUGOHV ZKHQ also hinder factories from developing their

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Securing Green Transition of the Textile and RMG Sector

WHFKQRORJLFDO NQRZOHGJH DQG FDSDELOLWLHV $UHDV RI LQYHVWPHQW LQFOXGH HQHUJ\ ZDWHU
,QVXIߔFLHQW LQIRUPDWLRQ DQG DZDUHQHVV DLU ZDVWH PDQDJHPHQW DPRQJ RWKHUV 8WLOLW\
regarding green technologies and best FRQVXPSWLRQ SDWWHUQV UHYHDO GLVSDULWLHV ZLWK
practices can curtail a factory’s capacity smaller factories relying more on grid electricity.
to embrace environmentally friendly Worker demographics vary by gender and
technologies. This information gap is more DJH ZLWK ODUJH IDFWRU\ ZRUNHUV GHPRQVWUDWLQJ
pronounced in small and medium-sized as KLJKHU SURGXFWLYLW\ DQG ORZHU VLFNQHVVUHODWHG
ZHOODVPLFURVL]HGIDFWRULHVLQFRPSDULVRQWR absenteeism rates compared to their counterparts
their larger counterparts. LQ VPDOOHU IDFWRULHV 7KHVH ߔQGLQJV FROOHFWLYHO\
depict the diverse landscape of factories, their
Additionally, the need for green technology sustainability efforts, and the characteristics of
varies among factories of different sizes. WKHLUZRUNIRUFH
&RQVHTXHQWO\ WKH PDQDJHPHQW RI WKHVH
IDFWRULHV RIWHQ ODFNV FODULW\ DERXW ZKHUH DQG ,QYLHZRIWKHDQDO\VHVEDVHGRQWKHSULPDU\GDWD
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WHFKQRORJ\ 0RUHRYHU VRPH IDFWRULHV UHTXLUH study makes a number of recommendations for
assistance in identifying suitable green securing green transition in the textile and RMG
materials and technologies to implement sector in Bangladesh. These recommendations
sustainable practices, thereby compounding KDYH EHHQ FOXVWHUHG XQGHU ߔYH EURDG WKHPHV
WKH FKDOOHQJHV DVVRFLDWHG ZLWK PDNLQJ WKH viz. policy and regulatory measures, economic
transition. LQFHQWLYHV JUHHQ ߔQDQFH DZDUHQHVV DQG
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8. Conclusions and development. In this connection, it must be noted
Recommendations WKDWWKHVHߔYHWKHPHVDUHQRWPXWXDOO\H[FOXVLYH
and may have considerable overlaps among
7KH ߔQGLQJV RIIHU YDOXDEOH LQVLJKWV LQWR YDULRXV them.
facets of these industrial establishments. These
IDFWRULHVZLWKDQRWDEOHSUHVHQFHLQWKH50*DQG 7KH SUHVHQW VWXG\ DOVR LGHQWLߔHV WKH NH\ DFWRUV
WH[WLOH LQGXVWULHV GHPRQVWUDWH D WUHQG RI JURZWK that are relevant to each of the recommendations.
EHWZHHQ  DQG  )DFWRU\ VL]HV YDU\ *LYHQ WKH FRQWLQXRXV HIIRUW UHTXLUHG WR VHFXUH
VLJQLߔFDQWO\ ZLWK D PDMRULW\ IDOOLQJ LQ WKH PLFUR green transition of the textile and RMG sector of
category. Among large factories, green building the country, a multistakeholder approach has been
FHUWLߔFDWLRQ DZDUHQHVV YDULHV DQG VRPH QRQ considered. As can be seen from the discussion
JUHHQ FHUWLߔHG IDFWRULHV HPEUDFH VXVWDLQDELOLW\ later, the government agencies play a central role
to meet environmental regulations and buyer LQLPSOHPHQWLQJWKHVHUHFRPPHQGDWLRQV)URPD
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WKH (3=V 7LHUZLVH GLVWULEXWLRQ ZLWKLQ WKH 50* non-state initiatives often end up in being short-
factories reveals varied characteristics. WHUPDQGSURMHFWFHQWULFLQQDWXUH$GGLWLRQDOO\WKH
buyers, industry associations, and international
0RWLYDWLRQV IRU JUHHQ FHUWLߔFDWLRQ HQFRPSDVV development partners also have a critical role
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UHJXODWLRQV H[HUW D ZHDNHU LQߕXHQFH 7UDLQLQJ LQ WUDQVLWLRQ $V LQGXVWU\ LQVLGHUV DQG ߔQDQFHUV
sustainability is more prevalent in large factories, WKH\ FDQ FRQWULEXWH VXEVWDQWLDOO\ WRZDUGV JUHHQ
and the adoption of green policies is higher ߔQDQFH DZDUHQHVV DQG NQRZOHGJH VKDULQJ
DPRQJ WKHP DV ZHOO 1RWDEO\ ODUJH IDFWRULHV DQG VNLOOV DQG FDSDFLW\ GHYHORSPHQW )LQDOO\
make substantial investments in green initiatives. the academia and think-tanks can provide their

Page | 16
Securing Green Transition of the Textile and RMG Sector

VXSSRUWDVNQRZOHGJHDFWRUVLQWKHHIIRUWVWRZDUGV DJHQFLHV VXFK DV 0R()&& 0R, 0R& 0R)


green transition. BB, and MoP should be integral parts of the
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8.1 Policy and Regulatory Measures HQJDJHPHQW ZLWK WKH LQGXVWU\ DQG RWKHU
stakeholders including academia and think-
The task of securing green transition in the textile tanks to gather feedback and suggestions
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the policy domain. Given the multidimensional FRPSUHKHQVLYH DQG SDUWLFLSDWRU\ UHYLHZ
nature of the issue and the number and types process.
of stakeholders involved, effective coordination
among these players is critical so that policies are • Developing a common framework for green
not contradictory to each other, and efforts are standards and certification procedures
V\QHUJLVWLF6SHFLߔFDFWLRQVWKDWFDQEHWDNHQLQ based on international best practices and
WKLVUHJDUGLQFOXGH market requirements: As mentioned, lack
RI D VWDQGDUG GHߔQLWLRQ RI JUHHQLQJ UHVXOWV LQ
• Developing a comprehensive strategy that YDULRXV RSHUDWLRQDO GLIߔFXOWLHV IRU WKH ߔUPV
covers all aspects of a green transition To this end, government agencies such as
for the textile and RMG sector based on 0R, 0R()&& DQG QRQVWDWH DFWRUV LQFOXGLQJ
stakeholder consultation and evidence- industry associations, buyers, academia,
based analysis: The strategy should include DQG WKLQNWDQNV FDQ FROODERUDWH WRZDUGV
short-term and long-term goals, indicators, GHYHORSLQJ D FRPPRQ IUDPHZRUN IRU JUHHQ
targets, timelines, roles, responsibilities, VWDQGDUGV DQG FHUWLߔFDWLRQ $OO ߔUPV ZRXOG
budgets, and monitoring mechanisms. The adhere to the same environmental benchmarks
0LQLVWU\ RI (QYLURQPHQW )RUHVW DQG &OLPDWH ZLWK D XQLIRUP VWDQGDUG 0RUHRYHU D XQLIRUP
&KDQJH 0R()&&  DQG WKH 0LQLVWU\ RI FHUWLߔFDWLRQ SURFHGXUH ZRXOG PDNH LW HDVLHU
Industries (MoI) can take the lead in developing and less costly for factories to obtain green
this strategy. Pertinent government agencies FHUWLߔFDWLRQV UHTXLUHG E\ YDULRXV EX\HUV
including the Ministry of Commerce (MoC), eliminating the need to undergo multiple audits
0LQLVWU\ RI )LQDQFH 0R)  %DQJODGHVK %DQN RUFHUWLߔFDWLRQV
(BB), Ministry of Planning (MoP), and the Prime
0LQLVWHU‫ڕ‬V 2IߔFH 302  QHHGV WR EH FORVHO\ • Providing assistance to obtain green-
involved and consulted in the formulation related certifications: Technical assistance
process. The industry associations, buyers, and guidance could be provided to factories
academia, and think-tanks must be consulted to help them in implementing green standards
and be made part of the strategy development DQG FHUWLߔFDWLRQ SURFHGXUHV VXFK DV
SURFHVV 7KHVH DFWRUV FDQ VLJQLߔFDQWO\ FRQGXFWLQJDXGLWVLPSURYLQJHQHUJ\HIߔFLHQF\
contribute to the evidence generation process UHGXFLQJ ZDVWH DQG XVLQJ UHQHZDEOH HQHUJ\
UHTXLUHG IRU GHYHORSLQJ D FRPSUHKHQVLYH sources. To this end, state actors including
strategy. WKH 0R, DQG 6XVWDLQDEOH DQG 5HQHZDEOH
Energy Development Authority (SREDA),
• Creating a task force/committee to review and the industry associations and buyers can
policies and regulations related to the WDNH WKH OHDG UROH )XUWKHUPRUH ߔUPV FRXOG
green transition in the textile and RMG be incentivised to adopt green standards
sector:7KLVZLOOKHOSLGHQWLI\DQ\DPELJXLWLHV DQG FHUWLߔFDWLRQ SURFHGXUHV YLD RIIHULQJ
or contradictions and take timely actions SUHIHUHQWLDO DFFHVV WR EX\HUV ߔQDQFLQJ WD[
to address them, promoting a conducive breaks, or subsidies.
environment for green transition. Government

3DJH_
Securing Green Transition of the Textile and RMG Sector

8.2 Economic Incentives 8.3 Access to Green Finance

)DFWRULHV ZKLFK DUH FXUUHQWO\ LQYHVWLQJ DQG DUH Both the state and non-state actors can contribute
ZLOOLQJ WR LQYHVW LQ SURPRWLQJ JUHHQ PHDVXUHV WRZDUGV HQVXULQJ HDV\ DFFHVV WR JUHHQ ߔQDQFH
technological development, productivity through mechanisms like soft loans, grants, and
enhancement, skill development of and higher seed funds. Information on the availability of
ZHOIDUH IRU WKH ZRUNHUV VKRXOG EH VXSSRUWHG funds should be disseminated by the relevant
through economic incentives. Correspondingly, departments of the government and industry
WKHIROORZLQJLQLWLDWLYHVFRXOGEHWDNHQ associations. Some actions that can be taken in
WKLVUHJDUGLQFOXGH
• Providing market-driven incentives, such
as tax breaks and subsidies, for factories • Creating a comprehensive system for
that invest in sustainable production accessing green financing programmes:
processes: These incentives should be (DV\DFFHVVWRJUHHQߔQDQFHFDQEHIDFLOLWDWHG
DOLJQHG ZLWK WKH VHFWRUDO FOLPDWH JRDOV DQG by creating an online portal for factories that
environmental standards. Tax incentives may ZDQWWRLQYHVWLQVXVWDLQDEOHSUDFWLFHV7KH,&7
be provided to small and medium factories Division of the government can develop the
ZKLFKZDQWWRLPSRUWHIߕXHQWWUHDWPHQWSODQWV portal and may include all relevant information
DQG REWDLQ JUHHQ FHUWLߔFDWHV 7KH 0R, 0R) SHUWDLQLQJ WR JUHHQ ߔQDQFH RSSRUWXQLWLHV DQG
DQG0R&QHHGWRFROODERUDWHWRFRPHXSZLWK KRZWRDFFHVVWKHP)XUWKHUPRUHLQFUHDVLQJ
the instruments to incentivise investments in WKH DOORFDWLRQ RI IXQGV IRU JUHHQ ߔQDQFLQJ
sustainable production processes. programmes, developing a help desk to assist
LQDFFHVVLQJJUHHQߔQDQFLQJVWUHDPOLQLQJWKH
• Withdrawing fiscal support to the polluters: application process, limiting the documentation
)LVFDO VXSSRUW WR SROOXWLQJ LQGXVWULHV DQG UHTXLUHPHQWDQGUHGXFLQJWKHWLPHUHTXLUHGIRU
IRVVLO IXHOEDVHG SRZHU JHQHUDWLRQ VKRXOG DSSURYDOZLOOEHJUHDWO\EHQHߔFLDOIRUIDFWRULHV
EH ZLWKGUDZQ DQG WUDQVIHUUHG WR FOHDQ LQWHUHVWHG LQ JUHHQ ߔQDQFLQJ 7KH 0R) %%
technologies. The textile and RMG factories DQG0R,FDQZRUNMRLQWO\WRWKLVHQG
investing in green production processes
should have access to those funds. Given • Establishing a credit guarantee scheme
the contentious nature of the initiative, the to enable smaller factories to access
0R,0R)DQG0LQLVWU\RI3RZHU(QHUJ\DQG sustainable financing options: Such options
0LQHUDO 5HVRXUFHV 0R3(05  ZLOO QHHG WR may include providing guarantees or insurance
play a strong leadership role. IRU60(VWKDWIDFHGLIߔFXOWLHVREWDLQLQJORDQV
for green investments. The Bangladesh Bank
• Providing premium prices for products DQGFRPPHUFLDOEDQNVZLOOKDYHDQLPSRUWDQW
from green factories: As mentioned earlier, role to play in making green funds available
premium prices are expected to encourage WR WKHVH ߔUPV 7KH EX\HUV DQG LQWHUQDWLRQDO
more factories to engage in greening initiatives. GHYHORSPHQW SDUWQHUV FDQ ߔQDQFLDOO\
)XUWKHUPRUHVXFKDQLQLWLDWLYHZLOOEHDEOHWR FRQWULEXWHWRZDUGVWKHVHIXQGVZKLOHWKH0R,
compensate for the huge initial investment can serve the role of an interlocutor.
UHTXLUHG IRU JUHHQLQJ WKH IDFWRULHV 7KH
EX\HUV ZLOO KDYH WR SOD\ WKH OHDG UROH LQ WKLV 8.4 Awareness and Knowledge
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continuously pursue this agenda. The MoI can
act as the interlocutor in case of a possible All types of factories in the textile and RMG sector
GHDORUDJUHHPHQWEHWZHHQWKHEX\HUVDQGWKH should have access to information on greening
industry. WKHLU RXWOHWV $ZDUHQHVV LV QHHGHG RQ WKH

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Securing Green Transition of the Textile and RMG Sector

PHDQLQJDQGLPSOLFDWLRQVRIJUHHQLQJDQGZD\VWR
be green. Information on green transition should • Providing technical guidance and
EH HDVLO\ DYDLODEOH QRW RQO\ WR WKH RZQHUV EXW support to mitigate knowledge gaps: The
DOVRRIߔFLDOVZRUNHUVDQGWUDGHXQLRQPHPEHUV JRYHUQPHQW LQ FROODERUDWLRQ ZLWK WKH EX\HUV
6SHFLߔF DFWLRQV WKDW FDQ EH WDNHQ LQ WKLV UHJDUG associations, international development
DUH partners, and academia, should offer technical
guidance and support to assist factories in
• Making information on greening publicly adopting sustainable practices and addressing
available: The government, keeping NQRZOHGJHJDSV7KLVFDQLQFOXGHDVVLVWDQFH
in mind its climate-related goals and LQ REWDLQLQJ JUHHQ FHUWLߔFDWLRQV LGHQWLI\LQJ
commitments, should ensure that information cost-saving opportunities for factories to
on effective green management, practices, transition to sustainable practices, and helping
and technologies is readily available to all them develop sustainable business models.
LQWHUHVWHG SDUWLHV7KH 0R()&& DQG WKH 0R,
can be instrumental in this regard. The goal 8.5 Skills and Capacity Development
of information sharing can be achieved by
establishing a central database or platform 7KHUH VKRXOG EH VSHFLDO WUDLQLQJ DQG ZRUNVKRS
for disseminating information on sustainable for the factories, particularly the small and
practices. The ICT Division can develop such PHGLXPHQWHUSULVHVWRUDLVHWKHLUDZDUHQHVVDQG
D SODWIRUP 1RQJRYHUQPHQW HQWLWLHV VXFK DV encourage them to undertake green measures.
industry associations, academia, and think Women’s participation in such trainings must be
WDQNV VKRXOG DOVR EH DOORZHG WR FRQWULEXWH ensured. These can be organised by industry
to this platform. By making this information DVVRFLDWLRQV ZLWK VXSSRUW IURP DFDGHPLD DQG
SXEOLFO\DYDLODEOHߔUPVFDQJDLQDFFHVVWRWKH think-tanks and be funded by buyers and
QHFHVVDU\ NQRZOHGJH DQG WRROV UHTXLUHG WR international development partners. Training
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• Conducting workshops, training sessions, should be organised by relevant ministries and
and campaigns to foster changes in values departments, associations, and the central bank,
and attitudes toward sustainability: The Bangladesh Bank. Training should be an ongoing
JRYHUQPHQW LQ FROODERUDWLRQ ZLWK WKH EX\HUV process since rules and regulations often change
industry associations, and international and all stakeholders related to the sector including
development partners, should organise WKHRZQHUVPDQDJHUVWUDGHXQLRQVDQGZRUNHUV
UHJXODU ZRUNVKRSV DQG WUDLQLQJ VHVVLRQV WR VKRXOGEHPDGHDZDUHRIVXFKFKDQJHV+HQFH
UDLVH LQGXVWU\ VWDNHKROGHUV‫ ڕ‬DZDUHQHVV RI WKH JRYHUQPHQW DJHQFLHV LQFOXGLQJ WKH 1DWLRQDO
WKH EHQHߔWV RI VXVWDLQDEOH SUDFWLFHV 7KHVH 6NLOOV 'HYHORSPHQW $XWKRULW\ 16'$  DQG WKH
sessions give participants a comprehensive MoI can take the lead coordinating role. Some
understanding of sustainable practices, their LQLWLDWLYHVLQWKLVUHJDUGFRXOGEH
EHQHߔWVDQGWKHVWHSVUHTXLUHGWRLPSOHPHQW
them. Among the government agencies, • Increasing the availability of skilled
WKH 0R()&& DQG WKH 0R, VKRXOG WDNH WKH human resources: This can be achieved via
lead in this case to ensure continuation and developing and expanding apprenticeship and
sustainability of the initiatives. Launching mentorship programmes in green industries,
campaigns to promote sustainable practices GHYHORSLQJ SDUWQHUVKLSV ZLWK SULYDWH VHFWRU
DQG WKHLU LPSRUWDQFH FDQ DOVR EH EHQHߔFLDO organisations to provide training and
LQ VSUHDGLQJ DZDUHQHVV %RWK WKH 0LQLVWU\ RI FHUWLߔFDWLRQ SURJUDPPHV IRU JUHHQ VNLOOV DQG
Information and Broadcasting (MoIB) and the incentivising individuals and businesses to
media can be instrumental in this regard. participate in green skills training programmes.

Page | 19
Securing Green Transition of the Textile and RMG Sector

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Securing Green Transition of the Textile and RMG Sector

References

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*('   Bangladesh Delta Plan 2100 'KDND *HQHUDO (FRQRPLFV 'LYLVLRQ *('  3ODQQLQJ
Commission, Ministry of Planning Government of the People’s Republic of Bangladesh. Retrieved
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$VVHVVPHQWRI([LVWLQJ/HJDO)UDPHZRUNVDQG&KDOOHQJHVWKURXJK:RUNLQJIURP+RPHInternational
Journal of Academic Research in Business and Social Sciences, 11(10)  GRL KWWSG[GRL
RUJ,-$5%66YL

.KDQ 0 ,  :LFKWHULFK &   Safety and labour conditions: the accord and the national
tripartite plan of action for the garment industry of Bangladesh %HUOLQ *OREDO /DERXU 8QLYHUVLW\
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/XNHQ5 &ODUHQFH6PLWK(  Greening Industrialization in Sub-Saharan Africa. Dar-es-


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0L%  Mapped in Bangladesh: Summary5HWULHYHGIURPKWWSVPDSSHGLQEDQJODGHVKRUJ

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0R()&&   National Adaptation Plan of Bangladesh (2023-2050) 'KDND 0LQLVWU\ RI
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Securing Green Transition of the Textile and RMG Sector

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sustainable-industrial-development

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Securing Green Transition of the Textile and RMG Sector

Annex

Figure A4.1: dŝĞƌͲǁŝƐĞŝƐƚƌŝďƵƟŽŶŽĨ^ƵƌǀĞLJĞĚZD'&ĂĐƚŽƌŝĞƐ

200 100.00 120


180
100
160
Number of Factories

140
62.09 80

Percentage
120
100 60
80
30.22
40
60
40 7.69 20
20
55 113 182
0 14 0
Tier 1 Tier 2 Others including Tier 3 Total

Freq. % of factories in tier

^ŽƵƌĐĞ͗ ĂůĐƵůĂƚĞĚĨƌŽŵƚŚĞW'ƌĞĞŶdƌĂŶƐŝƟŽŶ^ƚƵĚLJƐƵƌǀĞLJĚĂƚĂ͘

Table A.1: 2ther Environmental CertiÀcates

Name of the CertiÀcates Freq. Per cent


BCI  
BSCI 6 
(QYLURQPHQW&OHDUDQFH&HUWLߔFDWH  
GOTS  
OCS  
RCS 1 
GRS 4 
Higg Index 1 
2(.27(;  
,62 1 
OHS 1 
SGS 1 
Sedex 14 
ZDHC 1 
Step octax 1 
Total  

Source: Calculated from the CPD Green Transition Study survey data.
Note:&ODVVLߔFDWLRQZDVQRWFUHDWHGVLQFHRQO\ODUJHߔUPVKDYHWKHFHUWLߔFDWHV

3DJH_
Table A5.1: Investments, Loans, and Interest Rate

Investments, Loans, Large Factories Small and Medium Factories Micro Factories
and interest rate Yes No Avg. Amount/ Avg. Yes No Avg. Amount/ Avg. Yes No Avg. Amount/ Avg.
(%) (%) Interest rate (%) (%) (%) Interest rate (%) (%) (%) Interest rate (%)
Total Investment in last         
\HDUV
Take bank loans for         
making investment
Green Investment         
2QO\LQODVW\HDUV
Take bank loans         
for making green
investment only
Percentage of Green - -  - -  - - 
investment of total
Securing Green Transition of the Textile and RMG Sector

investment
Source: Calculated from the CPD Green Transition Study survey data.

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Table A6.1: Distribution of Respondents by Size and Gender

Category RMG Textile


Female Worker Male Worker Female Worker Male Worker
/DUJH)DFWRULHV n    
%    
6PDOODQG0HGLXP)DFWRULHV n    
%    
0LFUR)DFWRULHV n 116   
%    
Source: Calculated from the CPD Green Transition Study survey data.
Securing Green Transition of the Textile and RMG Sector

Infographic 1

Securing

Green INFOGRAPHIC 1
May 2023
Transition of the
TEXTILE & READYMADE
GARMENTS SECTOR IN
BANGLADESH

WHAT MOTIVATES FACTORIES TO ATTAIN


HOW FACTORIES GREEN BUILDING/PRODUCTION/PROCESS
CERTIFICATION
ARE ADOPTING
GREEN INITIATIVES
A SNAPSHOT Sustainability
CPD carried out a nationwide survey which Practice Marketing
Strategy
Buyer’s
covered owners and managers of 403 factories Requirement
Increased
Competitiveness
in Bangladesh. Of these, 182 were RMG and
221 were textile factories. Additionally, a total
Self- Motivation
of 4,541 workers and supervisors were
interviewed as part of this survey.
Factories that do not have any green building
SIZE AND TYPE OF SURVEYED FACTORIES
16.87% Self- Motivation
Textile

Marketing Strategy
56.47%
67.66% Increased Competitiveness
Buyer’s Requirement
83.13%
RMG

Sustainability Practice
43.53%
32.34% Factories with green product/ material/

Increased
LARGE SMALL & MEDIUM MICRO Competitiveness Self-
Motivation
Marketing Buyer’s
Strategy Influence
WHETHER FACTORIES KNOW ABOUT Buyer’s
GREEN BUILDING CERTIFICATION? Requirement
17.5%

Factories that want to obtain green product/


15.3%
80.7%

material/resources/production process
3.0%

Self- Motivation
Increased Competitiveness
Marketing Strategy
Buyer’s Requirement
Buyer’s Influence
LARGE SMALL & MEDIUM MICRO TOTAL

(Infographic 1 contd.)

3DJH_
Securing Green Transition of the Textile and RMG Sector

(Infographic 1 contd.)

DO FACTORY EMPLOYEES RECEIVE EMBEDDEDNESS OF GREEN POLICIES


WITHIN FACTORIES
25.6% 26.8% 28.0%

26.1%
90.4%
10.6%
8.9% factories’ strategic
objectives mention
environmental
factories have
clear policies
promoting
factories
identify
environmental
sustainability issues environmental protection as its
to prevent future sustainability or corporate social
health and awareness in all responsibility
environmental functional areas
LARGE SMALL & MEDIUM MICRO TOTAL damage

MAJOR FACTORS INFLUENCING GREEN INVESTMENT OUT OF TOTAL


FACTORIES’ GREEN INVESTMENT DECISIONS INVESTMENT IN LAST FIVE YEARS

37.0%
WHETHER ENVIRONMENTAL
SUSTAINABILITY HAS LARGE
WHETHER BEEN SET AS A FACTORIES
OWNERS OR STRATEGIC OBJECTIVE
MANAGERS HAVE WHETHER
ENEGY CONSERVATION

44.8%
TRAINING OR DEGREE
RELATED TO TARGETS HAVE SMALL & MEDIUM
SUSTAINABILITY OR BEEN SET FACTORIES
GREEN PRACTICE

Green
MICRO
FACTORIES 54.0%
Investment

MAJOR AREAS OF GREEN INVESTMENT BY FACTORIES

ENERGY CONSERVATION TECHNOLOGY


AIR POLLUTION CONTROL TECHNOLOGY
RENEWABLE ENERGY TECHNOLOGY
Energy Air DUST POLLUTION CONTROL TECHNOLOGY
BUILDING LEVEL ENERGY METER

SOLID WASTE MANAGEMENT


BUILDING LEVEL WATER METER
Waste
Water Management WASTEWATER MANAGEMENT
Technology

FOR DETA I LS Centre for Policy Dialogue (CPD)


Securing House 40/C, Road 11 (new)
Green Dhanmondi, Dhaka-1209, Bangladesh
Telephone: (+88 02) 48118090, 55001185, 58156979
Transition of the
TEXTILE & READYMADE E-mail: [email protected]
GARMENTS SECTOR IN
BANGLADESH cpd.org.bd cpd.org.bd

cpdbd CPDBangladesh

3DJH_
Securing Large factories are more aware than SMEs
Green Journey towards
Transition of the 17.51% of the
TEXTILE & READYMADE
Green Transition 71.13%
GARMENTS SECTOR IN factory owners and of supervisors are aware of green or
BANGLADESH

INFOGRAPHIC
environmental-friendly
Infographic 2

Through ADKAR Lense managers are aware


78.99% practices in factories.
of green certification.
The ADKAR model is a change management framework comprising five
key elements: Awareness, Desire, Knowledge, Ability, and Reinforcement.
It provides a structured approach for individuals and organisations to
of workers

Higher level of awareness is observed


2
June 2023

successfully navigate and adapt to change by addressing the psychological


and practical aspects of change implementation.
in large factories compared to small &
medium and micro factories. Self-motivation and marketing
The findings have been derived from a survey on the following. strategy are the key factors for
desiring green certification
182 221 4541
RMG Textile Workers &
Factories Factories Supervisors 68.18% of the owners and managers
expressed their desire to obtain
green certification.
AWARENESS Top three reasons for obtaining
Unlocking enviroment-friendly practices through green certifications
financial support & streamlined processes Self-motivation
69.70%
Limited funding access, complex documentation, reliance on DESIRE 54.55% Marketing strategy
self-investment and loans for environment-friendly practices.
39.39% Competitiveness
Limited financial support, subsidies and tax Change
concessions for green practices.
Management 87.50% are willing to adapt with
Incentives required to encourage the of supervisors

3DJH_
Framework new machinery/equipment/
transition of factories to green.

REINFORCEMENT
technology for greening
83.28% the process.
KNOWLEDGE of workers

SMEs have limited ability to adopt green


technologies compared to large factories ABILITY

Asymmetric information and constrained access to credit Knowledge asymmetry exists


are limiting the factories’ ability to obtain green certification. regarding green initiatives
Influencing factors for workers’ ability to adopt greening process
Overall, only 12.61% of owners and managers
have training related to sustainability or greening
40.48% Lack of training 30.00% Unwillingness to learn about new technology
factory or environmental compliance.
Owners, managers, and workers in large factories are more receptive in adopting
24.74% 11.97% have knowledge about any
the green process compared to small & medium and micro factories.
of supervisors of workers new machinery/equipment/technology.
FOR DETAILS
Securing Green Transition of the Textile and RMG Sector
Securing Green Transition of the Textile and RMG Sector

Infographic 3

INFOGRAPHIC
Securing

Green PATHWAYS TO GREEN TRANSITION


Transition of the
TEXTILE & READYMADE
GARMENTS SECTOR IN
BANGLADESH
OF THE TEXTILE AND RMG SECTOR

Thematic Area 1 POLICY AND REGULATORY MEASURES

Bangladesh Bank

Ministry of Finance
Prime Minister's Office

Developing a
comprehensive
strategy that covers all Sustainable and Renewable Energy
aspects of a green Development Authority
transition based on
Ministry of Planning stakeholder consultation
and evidence-based
analysis
Ministry of Commerce
Ministry of Industries

Policy and Regulatory Measures

Providing
Creating a task assistance to
force/committee to obtain
review policies and green-related
certifications
regulations related
to the green
transition
Think-tanks
Buyers

Academia

Industry Associations

Developing a
common framework
Ministry of Environment, for green standards
and certification
Forest and Climate Change procedures based on
international best
practices and market
requirements

Thematic area Policy recommendations Actors relevant to the recommendations


FOR DETAILS

(Infographic 3 contd.)
3DJH_
Securing Green Transition of the Textile and RMG Sector

(Infographic 3 contd.)

INFOGRAPHIC
Securing

Green PATHWAYS TO GREEN TRANSITION


Transition of the
TEXTILE & READYMADE
GARMENTS SECTOR IN
BANGLADESH
OF THE TEXTILE AND RMG SECTOR

Thematic Area 2 ECONOMIC INCENTIVES

Ministry of Commerce

Ministry of Finance Ministry of Industries

Providing
market-driven
incentives, such as tax
breaks and subsidies, for
firms that invest in
sustainable production
processes

Withdrawing fiscal
support to the
polluters
Industry Associations

Providing premium
prices for products
from green factories

Ministry of Power, Energy


and Mineral Resources

Buyers

Economic Incentives

Thematic area Policy recommendations Actors relevant to the recommendations


FOR DETAILS

(Infographic 3 contd.)

3DJH_
Securing Green Transition of the Textile and RMG Sector

(Infographic 3 contd.)

INFOGRAPHIC
Securing

Green PATHWAYS TO GREEN TRANSITION


Transition of the
TEXTILE & READYMADE
GARMENTS SECTOR IN
BANGLADESH
OF THE TEXTILE AND RMG SECTOR

Thematic Area 3 GREEN FINANCE

Green Finance

Ministry of Finance

Commercial Banks

Creating a
comprehensive
system for accessing
green financing
programmes
International
Development Partners ICT Division

Establishing a
credit guarantee
scheme to enable
smaller firms to access
sustainable financing
options

Bangladesh Bank

Buyers

Ministry of Industries

Thematic area Policy recommendations Actors relevant to the recommendations


FOR DETAILS

(Infographic 3 contd.)
3DJH_
Securing Green Transition of the Textile and RMG Sector

(Infographic 3 contd.)

INFOGRAPHIC
Securing

Green PATHWAYS TO GREEN TRANSITION


Transition of the
TEXTILE & READYMADE
GARMENTS SECTOR IN
BANGLADESH
OF THE TEXTILE AND RMG SECTOR

Thematic Area 4 AWARENESS AND KNOWLEDGE SHARING

Ministry of Information
and Broadcasting

Conducting
workshops, training
sessions, and
campaigns to foster
changes in values and
attitudes toward
sustainability Ministry of
Industries

Media

Providing
technical guidance International
Development Partners
and support to
mitigate knowledge
gaps
Industry Associations

Think-tanks

Awareness and
Knowledge Sharing Making information
on greening publicly
available via a central
database

Buyers

ICT Division

Ministry of Environment,
Forest and Climate Change

Academia

Thematic area Policy recommendations Actors relevant to the recommendations


FOR DETAILS

(Infographic 3 contd.)
3DJH_
Securing Green Transition of the Textile and RMG Sector

(Infographic 3 contd.)

INFOGRAPHIC
Securing

Green PATHWAYS TO GREEN TRANSITION


Transition of the
TEXTILE & READYMADE
GARMENTS SECTOR IN
BANGLADESH
OF THE TEXTILE AND RMG SECTOR

Thematic Area 5 SKILLS AND CAPACITY DEVELOPMENT

Ministry of Finance

Bangladesh Bank

Ministry of Environment,
Forest and Climate Change

Skills and Capacity Establishing a


Development
green skills
development fund
Industry Associations

Ministry of Industries

Academia
International Development
Partners
Increasing the
availability of
skilled human
resources

Buyers

National Skills
Development Authority
Think-tanks

Thematic area Policy recommendations Actors relevant to the recommendations


FOR DETAILS

3DJH_
Centre for Policy Dialogue (CPD)
House 40/C, Road 11 (new)
Dhanmondi, Dhaka-1209, Bangladesh
Telephone: (+88 02) 48118090, 55001185, 58156979
Fax: (+88 02) 48110414 E-mail: [email protected]
Website: www.cpd.org.bd

cpd.org.bd cpd.org.bd cpd_bangladesh CPDBangladesh

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