Ashulia, located on the outskirts of Dhaka, is facing a challenging recovery period as major apparel brands and retailers reduce their orders from local factories to mitigate supply chain risks following last year’s labour unrest. Brands from Spain, Switzerland, and the USA are particularly cautious, opting to relocate production to other areas of Bangladesh.
This strategic shift has created uncertainty for Ashulia’s suppliers, impacting their long-term production plans. However, some factory owners report a temporary influx of additional orders shifting from China for the upcoming Spring-Summer 2025-26 season, helping to offset the immediate decline in business.
Ashulia is home to over 400 export-oriented apparel factories that employ around 1 million people and contribute approximately US $ 8 billion to Bangladesh’s annual export earnings. Despite the challenges, some factories have managed to maintain production through subcontracting, although this requires prior approval from reputed buyers.
The ongoing unrest in the region has prompted many buyers to redirect orders to factories in Gazipur, Chattogram, and other areas perceived as having lower risks. While low-end and discount buyers continue to place orders due to pricing considerations, concerns remain about long-term recovery and the stability of the Ashulia zone.
Political stability and effective Government intervention are seen as crucial for restoring confidence among buyers and ensuring the growth of the ready-made garments (RMG) sector, which plays a vital role in Bangladesh’s economy.
