The Bangladesh garment industry is experiencing unexpected growth due to US manufacturers' fears of being swamped by Chinese imports, officials say.
Nine months ago the industry's future looked dangerously uncertain after the abolition of an international quota system that guaranteed manufacturers access to overseas markets for their textile products.
Industry watchers predicted that many knitwear makers, which make up 42 percent of Bangladesh's garment exports, would go out of business in the face of intense competition from India and China.
But now figures for knitwear exports to the US during the first six months of 2005 have shown a rise of 116 per cent on the same period last year.
Analysts and officials say the abolition of the Multi-Fibre Arrangement (MFA) and new concerns among US manufacturers about being flooded by Chinese imports have worked in Bangladesh's favour.
A coalition of US textiles manufacturers has lobbied the government to impose quotas on some Chinese garment imports.
They argue that Chinese imports have soared since the end of the MFA quota system on December 31, 2004, putting US jobs at risk.
"The ongoing rows about Chinese textiles have brought the spotlight onto Bangladesh, said Mortuza Haider, a senior executive at US retailing giant Walmart's Bangladesh office.
"I think the growth will continue well into 2007 or maybe into the middle of 2008 as China will have to live with these restrictions up to that period," he added.
The US government has extended a review on whether quotas on four categories of Chinese textile imports are needed by a month until November 30.
Meanwhile, Bangladeshi knitwear manufacturers say they have been "overwhelmed" with orders from US buyers.
The increase has led to at least 92 new factories being set up and the creation of more than 100,000 new jobs. "Before the end of the MFA quota system at the end of last year, only a few US buyers knew about us and our competitive advantages," said Fazlul Haq, president of the Bangladesh Knitwear Manufacturers and Exporters Association.
"But everything changed after January and buyers now can see that we can match China product by product and sometimes even be better," he added.
Bangladeshi economist Mustafizur Rahman of the think-tank Centre for Policy Dialogue said the country's knitwear manufacturers were partly reaping the benefit of measures taken in the run-up to the MFA abolition aimed at improving competitiveness.
"Exporters have diversified their products and are doing some quality products," he said.
Knitted garment makers, unlike woven garment manufacturers, were also able to keep prices lower because they do not have to rely on imported fabrics, added Rahman, who is a visiting professor at Yale University.
Buoyed by the surge in orders, Bangladeshi exporters are now planning a single country exposition in the United States from November 14-16.
"We are doing the exposition for the first time in our industry's history and we hope our products will win many hearts in United States," Haq said.
Textile exports brought in 6.57 billion dollars in the fiscal year ended June 2005, accounting for three-quarters of impoverished Bangladesh's entire foreign revenue earnings.