RMG industry of Bangladesh in the 21st Century

RMG sector in Bangladesh has experienced an amazing growth from its inception a little over three decades ago. From the humble beginning of US $ 1.2 million worth of export in 1978, the annual average export these days is US$ 20 billion, and is 80% of the total export of the country. This rise has made Bangladesh the second largest manufacturer of Ready Made Garments (RMG) right after China. Many leading apparels company ahs moved their business from China to Bangladesh for comparative advantage. It also brought in a wave of female workers, who have broke out from the traditional duties in the household and have become part of the 4 million strong work force. Women comprise of 80% of the overall work force as well. This industry has also created a wave of new entrepreneurs who have setup their own facilities and thus have created 5400 factories overall. However, not all of them comply to the accepted standards of safety.

After the MFA came to an end and it made its transition into the New World Trade regime at the outset of 2003, the RMG sector in Bangladesh feared that it might lost its business to other countries such as China or India. Despite this gloomy prediction, Bangladesh seems to thrive in this sector and continue to grow. According to Kumar (2006), the sector in Bangladesh has experienced a staggering 20% annual growth. As of now, 10 million people in Bangladesh earn their livelihood, directly or indirectly, from the RMG sector. According to World Bank (2006), RMG sector is responsible for 40% of the industrial employment.

The impressive rise and performance in this sector is, however, not without problems. The state of labour rights in the industry has created a lot of problem and discomfort in the RMG industry. The growing concern is that there are instances were labour rights were violated in the industry. Several empirical studies have also concurred to such concerns, as they point out that labour rights is yet to be established in this sector.

Labour rights act as a safeguard against various forms of discrimination in the workplace. These rights have become a prerequisite for a healthy business organisation. It has been ratified by the Human Rights Convention. Bangladesh is committed to establishment of labour rights as it is one of the members of the ILO. The expectations from such membership, however, are not reflected in the RMG industry. There is no practice of a formal agreement; instead the industry has an informal process of employment, thus leading to various negative consequences that include repression, poor working conditions and low wages.