The RMG business started in Bangladesh in the 70s but it was then merely a casual effort. The first consignment of knitwear export was made in 1973 and the first consignment of woven garments was made in 1977. Though started later, but it was the woven sector that first dint a spot in the export pie of Bangladesh. In 1981-82 the contribution of woven garments in the total export was 1.10%. Afterwards it is a story of sustained success for the Bangladesh RMG sector. Within a decade the contribution of woven to the export basket became 42.83% (1990-91) and the knitwear sector's contribution was 7.64% (1990-91).

The entrepreneurs of the knit sector stepped forward with their expertise in the late 80's. With their earnest efforts they were able to export US$ 14.84 million in 1989-90. Out of this US$ 12.22 million was exported to EU and US$ 2.02 million was exported to US. The trend continued in the knit sector because of the market access opportunity provided to the LDCs under the Generalised Systems of Preference (GSP) benefit.

This is the rejuvenated beginning of the epic story of Bangladeshi knitwear sector RMG sector that in true sense has been able to massive industrialization in a sustainable way with effect on all probable human development aspects which is the encouraging part of the story.

The growth of knitwear sector is increasing at an increasing rate. The cumulative average growth rate of the sector is 27%. And it is continuously grabbing a more portion in the export pie of Bangladesh. This is mainly attributed to the facilities provided under the EC GSP and ROO. The knitwear sector is heavily driven by these favorable policies and took the opportunity to develop a strong backward linkage for the sector.

EU is the main export region of Bangladeshi Knitwear constituting 79% (US$ 2227.27 million) of total knitwear export in FY 2003-2004 followed by USA (14.27%, i.e. US$ 402.38 million). This has become possible because it can satisfy the ROO of EU as value addition is higher (75%) in this sector. After the adoption of the guidelines for the application of the scheme of generalized tariff preferences by EC knitwear export from Bangladesh to EU rose precipitously. The two-stage transformation requirement of ROO in 1999 boosted market penetration in EU further; it contributed a growth of 101.19% since 2000-2001.

Bangladesh RMG sector has successfully passed some critical tests and is now sailing with two masts: knit and woven. The sub-sectors are now in healthy competition among themselves to take the role of leadership within the country.

In FY 2003-04, knitwear for the first time exceeded woven wear and became the leader in terms of quantity exported with 91.6 million dozens. The amount of woven export was 90.49 million dozens. Knitwear is still leading in terms of quantity exported and is widening the gap day by day. The present difference in favor of knitwear is 56.21 million dozens. In FY 2003-04, the contribution of two RMG sub-sectors in national export were as follows: Woven Garments 46.54% and Knitwear 28.25%. In FY 2004-05 the figures have changed dramatically, the share of woven garment to the country's export has reduced to 41.58%, on the other hand the share of knitwear has increased to 32.58%. It indicates clearly that the knitwear is performing well in both ways. In FY 2005-06 the scenario is as under: