Bangladesh turmoil to hurt global supply chain

Bangladesh Prime Minister Sheikh Hasina landed at the Hindon Air Base near New Delhi after the army took power in the country following violent riots.

It is not clear if the Bangladesh Prime Minister will stay in Delhi or move to another location, reports ANI.

The global supply chain, already roiled by the Red Sea crisis, port congestion and uncertainty ahead of the U.S. elections, will now have another headache to handle - how the geopolitical situation will affect the shipments of readymade garments (RMGs) from Bangladesh.

Bangladesh exported RMGs of approximately $47 billion for global clients like Inditex (owners of brands like Zara and Massimo Dutti and others), H&M, Marks & Spencer, GAP, Levi's, US Polo and American Eagle.

Major importers of Bangladeshi RMGs include the United States ($10 billion), Germany ($10 billion) and the United Kingdom ($5 billion).

Despite the West meddling in Bangladesh’s domestic issues, any extreme steps from either side can have a detrimental impact on Bangladesh’s economy, writes Soumya Bhowmuick in this article for the Observer Research Foundation.

"Bangladesh’s export-oriented growth is highly dependent on exports to Western countries, so any potential sanctions or trade restrictions could significantly harm the economy. Maintaining a diplomatic balance with Western countries is crucial for Bangladesh to avoid potential sanctions and ensure economic stability."