Business leaders have called for the quick formulation of a comprehensive national chemical policy to reduce Bangladesh’s heavy reliance on imported raw materials used in its export-oriented industries.
They warned that continued dependence on imported chemicals is weakening competitiveness, raising production costs and exposing key sectors to global supply chain disruptions.
The call came at a seminar titled “Developing Backward Linkages in Chemical-Dependent Export-Oriented Industries”, organised by the Dhaka Chamber of Commerce and Industry (DCCI) in the capital on Saturday.
Presenting the keynote paper, Asif Rabbani, managing director of ACI Chemical Industries Ltd and SR Specialty Chemicals Ltd, said nearly all major export sectors — including readymade garments, pharmaceuticals, leather, textiles and plastics — are heavily dependent on imported chemical inputs.
He noted that the garment industry alone uses প্রায় 2,500 types of chemicals, most of which are sourced from abroad. Around 90% of active pharmaceutical ingredients (APIs) used in the pharmaceutical sector are imported, while the leather industry also relies largely on foreign tanning chemicals.
Rabbani said the domestic chemical market is currently valued at $6–8 billion and has been expanding at an annual rate of 10–15%. However, chemical imports surged to $6.2 billion in the 2024–25 fiscal year, up 17.8% from the previous year, accounting for প্রায় 10% of total imports.
He identified several structural challenges holding back local producers, including an inverted tariff regime, complexities in HS codes, misuse of bonded warehouse facilities, lack of specialised chemical storage, unreliable gas and power supply, inadequate testing laboratories and weak logistics systems.
To address these issues, the keynote paper outlined four key recommendations.
These include rationalising tariff structures and HS codes while preventing misuse of bonded warehouse facilities; establishing specialised chemical warehouses, dedicated chemical special economic zones (SEZs), modern laboratories and ensuring uninterrupted utility supply; introducing a single-window licensing system alongside a national chemical policy; and strengthening research in APIs, green chemistry and industry-academia collaboration.
DCCI President Taskin Ahmed, who chaired the session, said developing a strong chemical backward linkage is now critical to enhancing the competitiveness of Bangladesh’s export industries.
He cautioned that without expanding domestic production of dyes, chemicals and other specialty inputs, production costs will continue to rise while vulnerability to global supply shocks will increase.
Speakers said establishing modern chemical SEZs could reduce local production costs by 20–30%. They added that raising backward linkage capacity to around 60% would significantly cut import dependence, save foreign exchange and strengthen the country’s export competitiveness.
Representatives from the Department of Environment, Bangladesh Council of Scientific and Industrial Research (BCSIR), Department of Explosives, Directorate General of Drug Administration, Bangladesh Atomic Energy Commission, as well as policymakers and business leaders, attended the seminar.