By Vijay Jayaraj

Whether living in the United States or in a European country, there is a greater chance of wearing a garment made in Bangladesh than in one’s homeland. However, the south Asian country’s dominance in the manufacture of clothing is being threatened by a “green” agenda undermining the power supply.

With availability of cheap labor and plentiful raw materials, Bangladesh is the world’s second biggest garment exporter and trails only China, having surged ahead of other Asian competitors such as India, Cambodia, Vietnam and Thailand. A key to sustaining this manufacturing boom is maintaining supplies of electricity to run factories.

Made In Bangladesh

The “Made in Bangladesh” label has become synonymous with affordable, quality garments for much of the globe and with the economic growth of a country that achieved independence from Pakistan in 1971 and now shares borders with India and Myanmar. Bangladesh garment-making is more than just another economic sector; it is the lifeline of the national economy.

In a nation of 168 million, the industry employs more than 4 million workers, the majority of whom are women, and accounts for approximately 84% of the country’s total exports. Bringing in $47 billion to the economy, Bangladeshi clothing supplies global brands such as Walmart, H&M of Sweden and Zara of Spain.

In 2023, knitwear export earnings reached nearly $26 billion, while woven garments earned more than $21 billion. Both categories realized year-on-year growth of approximately 11% and 9% percent, respectively.

This success is built on factories that operate within tight schedules to meet international demands and deadlines. They require a steady flow of electricity to light facilities and operate machinery. Any disruption can result in significant financial losses for factory owners and hourly workers.

In a country where the minimum wage for garment workers is around $113 per month (about $4 a day), even a small reduction in working hours makes a huge difference in a person’s life.

Nonetheless, intentional disruptions in the power supply occur almost every day to manage Bangladesh’s chronic shortage of electricity. The exception to these interruptions has been winter when overall energy demand is lower.

The large gap in the supply and demand for electricity also sometimes leads to sudden, unplanned blackouts such as one in October 2022 when 80% of the country (including key industrial hubs of Dhaka, Chattogram, Sylhet, and Mymensingh) were left without electricity.

Lasting for up to eight hours, the “outage affected production in garment factories and small and medium industries” as millions suffered in sweltering heat, according to news reports.

Net Zero and Green Fantasies Present More Uncertainty

Now, the national government in Dhaka has announced plans to saddle the struggling power system with the reliability issues of the so-called green energy of wind and solar as part of a net zero scheme to be “carbon neutral” by 2050. This would be disastrous.

Relatively reliable fossil fuels provide more than 98% of Bangladesh’s electricity and still the grid has issues managing the supply-demand gap. The well-known intermittency of solar panels and wind turbines makes them available only 10% to 30% of the time and sometimes overproducing when they are. Such erratic operational features add complexity, risk of damage to equipment and more uncertainty to an already shaky grid.

Instead of wasting time and money on renewables, the country should focus on increasing its power capacity from conventional energy sources like coal and natural gas. Even analysts supporting “green” energy say the country must allocate more funds towards oil and gas exploration in order to reduce dependency on imported liquified natural gas to fuel plants that now generate 70% of the electricity.

Bangladesh should stick to its current course of giving energy security top priority and reject pseudoscientific theories about climate change that promote unreliable energy sources. The beneficiaries would be millions of Bangladeshi workers, the country’s development goals and clothing shoppers worldwide.

This commentary was first published at Real Clear Markets on June 29, 2024.

Vijay Jayaraj is a Research Associate at the CO2 Coalition, Arlington, Virginia. He holds a master’s degree in environmental sciences from the University of East Anglia, U.K.