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Bangladesh’s tighter controls on yarn imports could help revive closed and underused textile mills, potentially creating or securing nearly 1.5 million jobs while reducing the country’s import bill, officials and industry leaders say.

The restrictions cover 10-count to 30-count cotton yarn and are aimed at strengthening the domestic spinning industry and the wider textile and RMG supply chain. Officials estimate the measure could save around $1.6 billion a year in import costs.

The move follows recommendations from the Bangladesh Trade and Tariff Commission (BTTC). A commerce ministry official said the ministry has advised the National Board of Revenue (NBR) to curb imports of the specified yarn counts to support local industry and employment.

Yarn imports under HS headings 5205, 5206 and 5207 nearly doubled from 350.8 million kg in FY23 to 697.1 million kg in FY25, with the latter valued at Tk 267 billion, according to official data.

The import bill rose further to about Tk 300 billion in FY26, with yarn in the 10-30 count range accounting for roughly 65 per cent of the total.

Textile millers estimate that replacing a substantial portion of these imports with locally produced yarn could save around Tk 200 billion a year, keeping more money within the domestic economy.

Under the new arrangement, traditional duty-free bonded warehouse facilities for the specified yarn counts have been withdrawn. Importers will instead be required to provide bank guarantees, verified export documents and maintain stricter accountability.

Industry leaders say the policy could also help revive factories that have remained closed or operated below capacity because of competition from cheaper imported yarn.

Engineer Razeeb Haider, former director of the Bangladesh Textile Mills Association (BTMA), said restarting closed and semi-closed textile factories could create jobs for nearly 1.5 million people.

He said the impact would extend beyond textile mills, supporting employment in cotton handling, transport, warehousing, packaging, engineering, utilities, banking, insurance, knitting, weaving and dyeing.

Md Badsha Mia, founder of Badsha Group of Industries, said the tariff commission reviewed import data before recommending that 10-30 count yarn be excluded from the bond facility to protect domestic spinning mills from unfair competition.

He said maintaining a balance between imported raw materials and local production was essential, particularly given the large capital investments already made in the textile sector.

“Ensuring a balance between required raw material imports and local production viability is vital. Without a protective framework for local processing steps, heavy capital investments in the textile sector face severe risks,” he said.

Chowdhury Mohammad Hanif, director of Salma Group and a BTMA director, said local mills had long struggled with low capacity utilisation because of an influx of cheap foreign yarn.

“When local production lines sit idle because of unchecked imports, the entire backward-linkage ecosystem suffers immensely,” he said.

He said tighter oversight would also help protect more than $32 billion invested in the sector, improve revenue collection and increase domestic value addition as Bangladesh prepares for the challenges of post-LDC trade.