Export Promotion Bureau (EPB) and Economic Trends, Bangladesh Bank In terms of GDP, RMG’s contribution is highly remarkable; it reaches 13 percent of GDPwhich was only about 3 percent in FY91. This is a clear indication of the industry’scontribution to the overall economy. It also plays a pivotal role to promote thedevelopment of other key sectors of the economy like banking, insurance, shipping, hotel,tourism, road transportation, railway container services, etc. A 1999 study found theindustry supporting approximately USD 2.0 billion worth of economic activities(Bhattacharya and Rahman), when the value of exports stood at a little over USD 4.0 billion. The sector has created jobs for about two million people of which 80 percent arewomen who mostly come from rural areas. The sector opened up employmentopportunities for many more individuals through direct and indirect economic activities,which eventually helps the country’s social development, woman empowerment and poverty alleviation.
3. FACTOR ENDOWMENT3. FACTOR ENDOWMENT
Factor conditions for Bangladeshi Clothing industry are skilled human resources and vastlabor force, government supports for textile and clothing technological upgrades, creationof textile and clothing villages, special economic/export processing zones, duty reductionfor the import of inputs/machines, incentive for use of local inputs, income tax reduction,and international supports like GSP, GSP+, duty free access etc.
RMG is a labor intensive industry. Since Bangladesh is a labor-abundant country, it islogical for Bangladesh to demonstrate its comparative advantage in clothing. Because of the abundance of labor, the labor cost of Bangladesh is also very low compared to theother developing countries. The wages paid to RMG workers in Bangladesh are the3