Industrial expansion in Bangladesh must accelerate to reduce the country’s $20 billion trade deficit and revive investor confidence, according to Showkat Aziz Russell, president of the Bangladesh Textile Mills Association (BTMA).
Speaking in an interview with TIMES of Bangladesh, he said the total trade stands at about $114 billion, with imports exceeding exports by $20 billion.
“There is no alternative to industrialisation if Bangladesh is to narrow the deficit and move towards a surplus,” he added.
Russel informed that foreign direct investment has fallen to its lowest level in recent years, reflecting policy inconsistency.
Investors prioritise stability over abrupt pricing shocks. So, if gas prices are suddenly doubled or tripled, the entire cost structure of businesses collapse, he said.
Russel stressed that Investment decisions require clear five or ten-year policy commitments.
He said leadership quality determines execution, noting that weak management in the past slowed progress despite policy intent.
“Without educated and skilled leadership, no policy can be implemented effectively.”
Russel also questioned whether the treasury could finance extensive manifesto pledges, warning that several commitments appear fiscally ambitious.
The immediate priority should be to protect and expand existing factories through swift administrative decisions and regular stakeholder consultation.
“Industry is the engine of the economy, and tax revenue comes from industry,” he said.
Russel cautioned that short-term revenue gains should not undermine competitiveness.
For example, reporting a Tk1,500 crore port surplus within six months is not meaningful if it stems from higher charges on manufacturers.
Besides, sustainable gains must come from efficiency in transhipment, container and cargo handling, he said.
Russel further said that repeated increases in corporate tax, duties and penalties to meet revenue targets risks weakening the industrial base.
“Revenue growth requires new industries, employment and higher production\,” he added. “Expanding the production base broadens the tax net organically.”
Russel also said that industrial policies require long-term clarity.
Citing positive results of the tenure of former finance minister M Saifur Rahman, the BTMA leader said that “the same cow cannot be slaughtered three times” to generate state revenue.
On the recent agreement with the US, he said in a cautious tone that it should be viewed positively but assessed carefully.
Certain clauses raise sovereignty concerns, including restrictions on partnerships and compliance with trade embargoes.
Benefits depend on meeting value addition thresholds, meaning lower-value products may gain more than higher-value exports.
“It would be unrealistic to expect extraordinary gains, though the agreement could create opportunities,” he added.
The requirement to use United States cotton could support the spinning sector, though shipment lead times of about three months increase working capital pressure.
Establishing warehouse facilities at Chattogram Port for US merchants would shorten raw material cycles and reduce financing needs, lowering interest costs, he said.
Administrative delays remain a constraint. Customs and revenue applications should be resolved within seven to ten days rather than left pending, added the BTMA leader.
Energy pricing is a key risk. A sudden 100 per cent gas tariff increase would be disruptive, particularly when global utility adjustments typically range between 1 and 5 per cent. “Investment follows predictable, phased policy adjustments.”
He underscored the need for institutional oversight, saying strong parliamentary opposition and active standing committees would reinforce accountability.
Logistics inefficiency continues to erode export competitiveness.
Container freight from Shanghai to New York averages about $900, yet shipments from Bangladesh to the same destination can reach $7000 due to handling charges, demurrage, inefficiencies and higher insurance premiums linked to political instability, he said.
Expanding port and airport capacity is essential alongside operational reforms, he added, noting that structured, training-based support from the armed forces has improved standards in certain cases.
“The survival of industry is inseparable from the survival of the national economy,” said the BTMA President.
