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$5-bn loss for Dhaka due to lack of circular textiles policy: Study

27 Aug '24
2 min read
$5-bn loss for Dhaka due to lack of circular textiles policy: Study
Pic: Adobe Stock

Insights

  • Bangladesh is losing up to $5 billion in potential export revenue every year from recycled textile products due to lack of a policy framework on circular textiles, a study by Germany's GIZ GmbH and H&M revealed.
  • Such a policy would incentivise the recycling of post-industrial textile waste and the textile industry must formalise the informal sector, it noted.
Bangladesh is losing up to $5 billion in potential export revenue every year from recycled textile products due to lack of a comprehensive policy framework on circular textiles, according to a study by Germany’s Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH and H&M.

Such a policy would incentivise the recycling of post-industrial textile waste, locally known as jhut.

Bangladesh’s textile industry must formalise the informal jhut sector, though political economy challenges have impeded an inclusive and just transition, the study noted.

Bangladesh’s current annual recycling capacity for apparel-grade yarns was estimated to be between 18,000 tonnes and 24,000 tonnes, which represented only about 5-7 per cent of the 3,30,000-5,00,000 tonnes of cent per cent cotton and cotton-elastane waste produced annually.

Less than 5 per cent of this waste is being upcycled into products like rag rugs, rag dolls and blankets and a substantial portion—over 55 per cent—is being exported to recycling companies worldwide, while the remaining waste is being downcycled into stuffing materials for cushions and mattresses, incinerated onsite for energy recovery, or sent to landfills.

The study report recommended collaborative stakeholder engagement, protection of workers’ rights and safety, promotion of circular textile economy practices, and capacity building and technology adaptation to transform the jhut sector, according to domestic media outlets.

It outlined a number of key policy solutions for the informal sector. These include improving data availability, transparency and traceability through a national jhut database, introducing industry guidelines for jhut management and recycling standards and revising value-added tax and tariff rules for jhut transactions.

It also suggested offering economic incentives to formalise jhut collection, handling and sorting, establishing central depository systems and cluster-based sorting hubs to promote decent work and social inclusion and enhancing the investment environment for advanced recycling technologies.

Fibre2Fashion News Desk (DS)

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