Bangladesh’s garment exporters are expected to face tougher competition in the European Union following the signing of the India-EU Free Trade Agreement (FTA), which grants Indian textile and apparel products duty-free access to the European market.
For decades, Bangladesh enjoyed a competitive edge in the EU under the Everything But Arms (EBA) scheme, which allowed duty-free entry for its garments. With the new FTA, India now matches this advantage, eroding Bangladesh’s long-standing zero-duty benefit.
Industry analysts noted that Bangladesh currently supplies around 21 percent of the EU’s textile imports, valued at approximately $30 billion annually. India, which exports about $7 billion worth of textiles to the EU, is projected to expand its share significantly under the FTA.
Commerce experts in India have forecast that the agreement could boost Indian textile exports to $30–40 billion, creating millions of jobs and reshaping the competitive landscape in Europe’s $250 billion apparel market.
Bangladeshi exporters fear that EU buyers, who are highly price-sensitive, may push for lower rates as Indian goods enter duty-free. This could squeeze margins and force Bangladesh to focus more on product innovation, compliance, and sustainability to retain contracts.
Observers also warn that Bangladesh’s future graduation from Least Developed Country (LDC) status may further challenge its position unless new trade agreements are negotiated to maintain preferential access.
The India-EU FTA is being seen as a game-changer in global textile trade, with Bangladesh now under pressure to diversify and upgrade its competitiveness to safeguard its market share in Europe.
