Eight months into the current fiscal year, export earnings have yet to recover, declining for seven consecutive months from August to February. Data from the Export Promotion Bureau show that ready-made garment exports in February totaled $2.8159 billion, down 22.10% from January and 13.21% year-on-year.
Over the first eight months of the fiscal year, garment export earnings fell 3.73%, dragging down overall performance. Total exports during July–February stood at $31.9058 billion, 3.15% lower than the same period a year earlier. February earnings alone reached $3.4953 billion, down 20.81% from January.
Entrepreneurs say the contraction in global demand caused by US tariffs and tighter trade policies will take time to ease. The renewed Iran–US–Israel conflict has added fresh uncertainty to global trade and energy markets, raising concerns of further pressure on Bangladesh’s export sector.
As fighting in the Middle East intensified, volatility spread to international energy markets. Rising crude oil prices, driven by fears of supply disruptions and regional instability, are already affecting the global economy. Analysts warn that a prolonged conflict would increase transport and production costs for energy-importing countries, heightening inflation risks.
Exporters say falling demand in the US and the European Union has already strained shipments. New geopolitical tension in the Gulf has amplified fears of disruptions in airspace and maritime routes, threatening supply chains across sectors, from perishable agricultural goods to garments.
The president of BGMEA warned that a prolonged war would place multidimensional pressure on Bangladesh’s economy. Higher global energy prices would directly raise production costs, especially in export-oriented garment factories. Passing those costs on to international buyers would be difficult amid weakening consumer purchasing power in key markets, potentially reducing apparel demand.
The Strait of Hormuz remains the central risk. This narrow waterway at the mouth of the Persian Gulf carries about 21 million barrels of crude oil daily and is vital to global energy transport. Even limited instability there pushes up oil prices. Escalation or shipping restrictions would increase freight charges, insurance premiums and delivery delays. If oil prices approach $100 per barrel and vessels are forced to reroute, transport costs would surge, eroding exporters’ competitiveness.
Energy crisis
Bangladesh’s energy security is closely tied to this route. A large share of its imported liquefied natural gas passes through the strait. More than half of last year’s LNG imports came from Qatar and the United Arab Emirates, almost entirely transported via this channel. In 2025, Bangladesh imported about 3.6 million tonnes of LNG from the Middle East, mainly from Qatar, a leading global supplier.
Bangladesh, along with China, India and Pakistan, depends heavily on Qatari LNG. Pakistan met nearly all of its LNG demand in 2025 from Qatar and the UAE, while India and Bangladesh sourced more than half of their supplies from the two countries. Any prolonged disruption would immediately strain South Asia’s energy market. Although Oman exports LNG from terminals outside the strait, its capacity is far smaller and insufficient to offset a major shortfall.
Global LNG supply is already tight. After Russian exports declined following the Ukraine war, the United States became the largest LNG exporter, followed by Qatar and Australia. Most LNG plants are operating at full capacity, limiting the ability to quickly fill supply gaps. Analysts estimate that a prolonged closure of the Strait of Hormuz could cut global LNG supply by up to 15 percent, forcing Asian buyers into fierce competition for spot cargoes and driving prices higher.
Bangladesh’s power generation is largely gas-dependent, with a significant share fueled by imported LNG. Any disruption would affect not only the energy sector but also industrial output and overall economic stability.
Although exports to Arab countries account for only about $900 million, or 2% of total exports, the market holds sectoral importance. More than 60% comprises RMG, while the rest includes fresh vegetables, fruits and other agricultural products. Prolonged disruption would delay industrial deliveries and cause spoilage of perishable goods, leading to losses on both fronts.
Air woes
The crisis has also affected air connectivity through Gulf hubs. Disruptions in regional airspace have forced airlines to suspend or reroute flights, increasing fuel costs and causing scheduling delays. Cargo movement has become uncertain.
Perishable exports have already suffered losses due to flight cancellations. Daily air shipments of fresh produce from Chattogram average around $250,000, but uncertainty has stalled new consignments. Garment exporters also face delays, with some shipments to the United Kingdom stranded at Dhaka airport because of transit disruptions.
Rerouting through alternative hubs would significantly increase costs. While sea shipments remain largely unaffected, air cargo operations are constrained, and export goods are accumulating at Dhaka airport.
