Bangladesh’s gathering storm: Diesel rationing, 8-10% order cut

The headline decline captures only part of the challenge. European orders have contracted at their fastest pace in more than a decade, while gas shortages and higher diesel costs have reduced factory utilisation and tightened operating margins. At the same time, trade financing for future shipments has weakened, adding further pressure to an industry confronting one of its most difficult periods in recent years.

Cost and supply-chain analysis

The more immediate challenge lies on the supply side. In April, BGMEA President Mahmud Hasan Khan told Bangladesh**;s Ministry of Power that gas and electricity shortages had reduced production capacity at garment factories by **–** per cent. Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) President Mohammad Hatem painted an even weaker picture, saying knitwear mills were operating at only **–** per cent of capacity while production costs had increased by about ** per cent.

The disruption followed the **** US-Israel conflict with Iran and the temporary closure of the Strait of Hormuz, the key maritime route supplying much of Bangladesh**;s imported fuel. Diesel prices for industrial backup generators were officially increased from Tk*** to Tk*** per litre, raising manufacturing costs across the sector.