Bangladesh has long been renowned for its “Made in Bangladesh” garments in markets across the European Union and the United States. Now, a new narrative is emerging as processed food products—bearing the same “Bangladesh Made” tag—are increasingly seen on supermarket shelves in the Middle East, Europe, and Africa. This shift signals a promising diversification in Bangladesh’s export portfolio, one that could transform the nation’s economic landscape.
Rising Export Figures and Global Reach
Agricultural and processed food products rank among the country’s top five export sectors. In the fiscal year 2020–21, shortly after the COVID-19 pandemic, exports in this sector surpassed USD 1 billion, and the following year the figure climbed to approximately USD 1.16 billion.
However, a subsequent fiscal downturn saw a 27% decrease, with exports falling to around USD 840 million. According to reports from the Bangladesh Investment Development Authority (BIDA) and the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), while global market estimates for these products reach staggering figures, Bangladesh’s domestic processed food market stands at roughly USD 4.8 billion—with agricultural products valued at nearly USD 47.5 billion.
Bangladesh’s agricultural exports now reach 144 countries, including key markets such as Kuwait, Qatar, Saudi Arabia, Germany, Belgium, the Netherlands, and the United Kingdom. The range of products is vast—from processed food items like spices, snacks, biscuits, sauces, jellies, and fruit drinks to fresh and frozen vegetables and fruits.
Industry Structure and Competitive Landscape
Within Bangladesh, about 1,000 processing factories operate, though 90% are micro or small-scale enterprises. Only roughly 10% are medium to large in size, with around 250 of these actively involved in exports. In fiscal terms, processed food products have contributed approximately 1.5% to the country’s total export earnings. Despite Bangladesh achieving USD 1 billion in agricultural exports, regional competitors like India are significantly ahead. Data from India’s Agricultural and Processed Food Export Development Authority indicate that in the fiscal year 2022–23, India’s processed food exports reached nearly USD 7.4 billion.
Success Stories from the Private Sector
Some private enterprises are already reaping the rewards of diversification. Chattogram-based HIFS Agro Food Industries, for example, now exports a variety of processed foods, beverages, and spices to 20 different countries, with last year’s exports reaching around USD 3.2 million. CEO Syed Muhammad Shoaib Hasan explained, “We are continuously learning in processed food production. When government officials inspect factories and note minor deviations—imposing fines without offering adequate time for corrections—it hampers progress. Allowing a grace period for rectification and providing tariff‐free access to packaging materials and raw inputs could easily double our export volumes.”
Pran Group, one of Bangladesh’s leading processed food exporters, sends juices, snacks, biscuits, confectionaries, and frozen foods to markets such as India, Saudi Arabia, Oman, the UAE, Malaysia, Australia, Canada, the United States, Italy, the United Kingdom, and several African countries. With an annual export value of approximately USD 300 million, Pran Group’s Chairman and CEO Ahsan Khan Chowdhury is optimistic: “Bangladesh’s potential in agricultural and processed food exports is enormous—we are currently utilizing barely 1% of that potential. While our company’s exports stand at USD 300 million, it is feasible to scale this to USD 30 billion with the right measures, although certain constraints remain.”
Government Initiatives and Policy Support
Recognizing the untapped potential in the agricultural export sector, government leaders are taking steps to diversify and strengthen the export base. At the first meeting of the new government last month, Prime Minister Sheikh Hasina directed relevant ministries to explore export diversification and facilitate market entry for new products. The government is considering support measures similar to those that helped develop the garment industry—with special emphasis on leather, jute, and agricultural products.
However, many industry experts note that while these initiatives are promising, substantial challenges remain. For instance, the reduction in cash incentives—from 20% to 10%—has constrained exporters’ ability to support farmers financially. Additionally, the high costs of raw materials and the imposition of steep import duties on essential inputs for processed food production place domestic enterprises at a competitive disadvantage.
Logistical and Certification Challenges
Beyond policy incentives, the sector faces a host of infrastructural and procedural hurdles. Exporters report that the cost of raw materials in Bangladesh is significantly higher than in neighboring countries. For example, one kilogram of sugar costs about 140 Bangladeshi taka (≈USD 1.16) in Bangladesh, compared to roughly 50 taka in India. Transportation costs further widen this gap. Container rentals in Bangladesh average around USD 6,000, whereas in India they are as low as USD 600—a tenfold difference that severely affects cost competitiveness.
Moreover, logistical bottlenecks at airports create additional delays. Many exporters lack dedicated storage and handling facilities such as separate gates, specialized scanner machines, or sufficient cold storage. The absence of enough accredited laboratories for rapid and cost-effective quality testing exacerbates the problem. One notable example involves certification fees: while one testing body charges 6,000 units in rupees, another (the Bangladesh Standards Testing Institution) levies a fee of 18,000 Bangladeshi taka (≈USD 148) with a turnaround time of 15–18 days. These delays and high costs can discourage potential buyers and slow market entry.
Non-tariff barriers in key markets also present formidable challenges. For instance, India has been reluctant to accept Bangladeshi quality certifications, such as those issued by BSTI, creating trade impediments. In an environment of rising exchange rate volatility and increasing transportation costs, the cumulative effect of these challenges is significant.
Domestic Demand and Emerging Market Trends
On the home front, the demand for processed foods is rising. Changes in lifestyle and an increase in dual-income households have spurred greater consumption of convenience foods such as bread, biscuits, potato puri, chips, confectionaries, noodles, juices, jams, and pickles. This shift is mirrored in export markets as well. With nearly two crore Bangladeshi expatriates worldwide—and growing interest in processed food products in markets like India, Nepal, the Maldives, and Bhutan—the sector is poised for further expansion.
Attracting Foreign Investment and Technological Upgrades
For the sector to realize its full potential, attracting foreign investment and embracing technological innovation are imperative. According to Bangladesh Bank data, the agriculture and fisheries sectors attracted around USD 58 million in investments in 2023—a notable increase from USD 39 million in 2022. Investments have flowed primarily from Singapore (approximately USD 24.41 million), followed by Thailand (USD 15 million) and the Netherlands (USD 9 million).
Former World Bank Chief Economist Dr. Jahid Hossain emphasizes that expanding production capacity and adopting advanced technologies will be key to enhancing Bangladesh’s global competitiveness. “Boosting production, investing in modern technology, and improving product quality are essential if we are to capture a larger share of the global market,” he noted.
Branding, Market Diversification, and New Market Penetration
Another critical factor for success is effective branding and market diversification. As Bangladesh is already recognized worldwide for its garments, industry leaders argue that a similar branding strategy for agricultural and processed food products could unlock significant export potential. Khondkar Golam Moazzem, Senior Research Director at the Center for Policy Dialogue (CPD), remarked, “Our products are now being showcased in supermarkets across Europe, the Middle East, and Africa. Participating in international exhibitions and clearly communicating our product quality and competitive prices is vital to capturing new markets.”
Preparing for Post-LDC Challenges
Bangladesh is on the cusp of graduating from Least Developed Country (LDC) status—expected by 2026. While this transition is a sign of progress, it also poses new challenges. Post-graduation, the nation will lose many preferential tariff benefits that have so far bolstered export competitiveness. New tariffs—ranging between 7% and 11% in some cases, and potentially as high as 11–22% in the Indian market—could significantly impact export volumes. Dr. Mohammad Abdur Razzak, Chairman of the Research and Policy Integration for Development (RAPID), explained, “Once we graduate from LDC status, we will no longer enjoy the tariff-free advantages. This necessitates urgent preparations to offset the impact of new tariffs and maintain our export momentum.”
A Roadmap for Enhanced Competitiveness
In response to these challenges, the Bangladesh Agricultural Research Institute recently unveiled a “Roadmap for Increasing Agricultural Exports.” The report outlines a series of recommendations designed to boost competitiveness and streamline export operations:
- Competitive Advantages: Conduct dedicated studies to assess the competitive edge of exportable agricultural products and identify short-term opportunities for improvement.
- Administrative Reforms: Under the leadership of the Ministry of Agriculture’s secretary, form committees comprising representatives from various departments to monitor export progress and submit quarterly reports.
- Infrastructure Upgrades: Establish dedicated facilities at airports—including separate gates, scanner machines, and expanded cold storage—to expedite the export process.
- Quality Certification: Enhance the capacity of accredited laboratories to reduce testing time and costs, thereby enabling faster certification and market entry.
- Farmer and Processor Training: Provide regular training sessions on modern crop production, grading, sorting, cooling, and packaging techniques to minimize post-harvest losses.
- Incentives for Technology: Offer incentives for adopting advanced technologies in production and processing, reducing reliance on cash subsidies and ensuring tariff-free imports for key raw materials.
- Market Intelligence: Develop comprehensive databases in collaboration with the Ministry of Foreign Affairs and the Ministry of Commerce to track international demand, quality requirements, and regulatory norms for various products.
The roadmap further details product-specific measures. For instance, in mango exports—a major area of focus for regions like Rajshahi, Satkhira, and Khagrachari—the establishment of modern packing houses and streamlined phytosanitary certification processes is critical. Similar recommendations apply to vegetables, potatoes, and spices, with an emphasis on improved grading, sorting, and packaging systems to reduce losses and meet international quality standards.
Looking Ahead
Despite facing numerous challenges—from high raw material costs and logistical bottlenecks to stringent quality certification procedures and impending tariff adjustments—the agricultural and processed food export sector in Bangladesh holds immense promise. With a combination of proactive government policies, increased foreign investment, technological modernization, and effective branding, industry stakeholders are confident that the sector can overcome current obstacles and unlock its full potential.
As Bangladesh prepares for a post-LDC future, the strategic reforms and investments being made today are set to redefine the nation’s export landscape. By leveraging its vast agricultural resources and tapping into new market opportunities, Bangladesh is poised to significantly expand its share of the global agricultural export market, ultimately contributing to a more diversified and robust economy.
