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and this may be a major reason for lower order volumes from major retailers and brands like H&M this year,” Hatem said.

He also said that during the meeting, H&M officials referred to India’s free trade agreement with the European Union and Bangladesh’s expected loss of preferential market access to the EU and other major markets after it graduates from least developed country (LDC) status to a developing nation in November this year.

Hatem added that India is offering several incentives to its textile and garment sector, including support for land, factory setup, bank loans, and worker benefits, to make it more competitive in the global apparel trade.

The BGMEA also held an emergency board meeting on Monday and identified several reasons behind the fall in garment exports over the past year, including global economic volatility, US reciprocal tariffs, the energy crisis, high bank interest rates, poor port operations and issues linked to LDC graduation.

Over the past year, weak global demand has slowed garment orders worldwide, as Western retailers and brands continue to hold unsold inventory, affecting sourcing decisions, said Mahmud Hasan Khan.

Apart from falling demand, US reciprocal tariffs have also hurt exports, as buyers remained uncertain about the final tariff rate after repeated changes in US President Trump’s tariff policy, he added.

The US-Israel war on Iran also disrupted shipments from Bangladesh, leading to rerouting of goods, higher airfreight costs, longer lead times and fewer buyer visits due to the disruption.

Different studies suggest Bangladesh could lose up to $17.5 billion in exports, particularly garments, annually due to LDC graduation, as around 73 percent of the country’s exports are LDC-related.