Bangladesh’s footwear sector is set for substantial expansion, presenting lucrative investment opportunities in both leather and non-leather segments. The Bangladesh Investment Development Authority (BIDA) highlighted this potential in a recent newsletter while also acknowledging the challenges that must be addressed to sustain growth and enhance competitiveness.
Shah Mohammad Mahboob, an executive member of BIDA, underscored the industry’s vast potential, stating, “If adequate facilities are provided, the sector will flourish and emerge as a major contributor to export earnings.” He also mentioned ongoing discussions with the National Board of Revenue to secure necessary incentives to attract investment.
BIDA reports indicate that the rise of non-leather footwear, driven by changing consumer preferences and environmental considerations, has created new investment opportunities and has outpaced the leather footwear segment in growth over the past decade. According to data from the Export Promotion Bureau (EPB), exports of non-leather footwear surged by 120 per cent in the last ten years, significantly exceeding the 6 per cent growth recorded in leather footwear exports over the same period.
In the first seven months of the 2024–25 financial year, non-leather footwear exports totalled $318.09 million, reflecting a year-on-year growth of 40.11 per cent. The sector is projected to exceed half a billion dollars in exports by the end of the fiscal year. Despite being the world’s eighth-largest footwear producer, Bangladesh’s leather goods and footwear sector continues to dominate, having generated $1.6 billion in exports in the previous fiscal year.
Riad Mahmud, Managing Director of Shoeniverse Footwear Ltd., part of the National Polymer Group, highlighted the sector’s strong potential, remarking, “If a corporate entity makes a substantial investment in the non-leather footwear sector, it will prove to be highly profitable.” However, he pointed out that Bangladesh currently has only 15 compliant non-leather shoe factories, each requiring a capital investment of approximately Taka 35 crore, posing a significant barrier to market entry.
BIDA also noted that many tanneries and footwear manufacturers face difficulties in adhering to global environmental and labour standards. Mahmud added that the sector is struggling with a shortage of skilled workers and cumbersome customs procedures for importing raw materials and exporting finished products.
Hasanuzzaman Hassan, Chairman of BLING Leather Products Ltd., a non-leather shoe factory based in rural Rangpur, shared his company’s success story. Since commencing production in 2020, BLING has exported to countries such as Poland, Turkey, the UAE, Germany, India, and Canada, earning Taka 320 crore from synthetic shoe exports in the last fiscal year.
Despite these achievements, BIDA has identified several challenges that must be addressed to ensure the sector’s continued growth. The absence of a domestic supply chain for synthetic materials is inflating production costs and increasing lead times, thereby undermining global competitiveness. Furthermore, inefficiencies in customs clearance, inadequate port infrastructure, and shipment delays pose significant obstacles for exporters.
The sector also requires a skilled workforce, yet the lack of sufficient training programmes is hampering efficiency. Small and medium-sized enterprises (SMEs), which represent a substantial portion of the industry, face additional difficulties, including high interest rates, stringent loan conditions, and limited access to financial support.
To promote sustainable growth and maintain competitiveness, BIDA advocates for policy reforms and increased investment. Recommended measures include establishing a bonded warehouse system to reduce dependency on imported raw materials and improving logistics and customs procedures to enhance export efficiency.
