Alongside encouraging Bangladesh apparel to go completely green, the investment will have a multiplier effect on women empowerment.
DBL Group, one of the leading Bangladeshi apparel exporters, is going to receive a $52 million credit facility from the British International Investment (BII), a UK-based development finance institution and impact investor.
The apparel manufacturer will use the money to establish Jinnat Textile Mills Ltd, a greenfield cotton yarn spinning mill in Moulvibazar’s Srihatta Economic Zone.
The new facility, which is expected to begin operation in April 2023, will be housed in a LEED-certified green building and will create more than 1,000 direct new jobs for lower-skilled workers, with over 50% of the workforce consisting of women.
The loan, which has a tenure of eight years with a two-year grace period, will support the project’s total investment of $83.35 million and is expected to produce 44 tones of yarn per day, with an annual turnover of Tk463 crore.
The facility will also contribute to the “2X Challenge”, which refers to the multiplier effect of investing in women empowerment.
The British International Investment is providing the credit support to the greenfield capex project as local commercial banks are not able to supply such a big amount with long-term repayment.
During the deal signing, DBL Group Managing Director MA Jabbar thanked the UK’s development-finance arm “for providing a platform for creating a more sustainable and inclusive economy”.
DBL Group is acclaimed for its substantial contribution to the sustainable development of the economy of Bangladesh. It has been awarded 167 acres of land in Srihatta Economic Zone, Moulvibazar, Sylhet, under the Bangladesh Economic Zones Authority (BEZA) to develop and set up new industries.
DBL’s biggest initiation at the industrial park is the Jinnat Textile Mills Limited with two spinning factories, which will be a vital part of DBL’s vertically integrated textile composite.
M Rehan Rashid, country director of the British International Investment, said, “Bangladesh and export-oriented sectors, such as garments, are a strategic priority for the BII. We look to partner with strong promoter groups, such as DBL Group, with a focus around inclusion and sustainability and BII will remain committed to investing in Bangladesh and its core sectors.”
“This partnership will support economic opportunities through the creation of jobs and provide economic empowerment to a large number of low-income workers, particularly women, which is how we look to deliver impact in our markets.”
British High Commissioner to Bangladesh, Robert Chatterton Dickson, said, “I am pleased that British International Investment’s partnership with DBL Group will increase job creation and business growth, whilst also setting new industry standards for improved working conditions for women and encouraging companies to be greener. The UK is committed to supporting Bangladesh’s development ambitions through championing investments which bolster the private sector and drive transformative sustainable economic prosperity across the country.”
The cotton yarn spinning units will cater to existing DBL buyers including H&M, George, Puma, Esprit, G-Star, Decathlon, Tom Tailor, MQ Retail, NEXT, M&S, Bench and Gymboree.
DBL Group has a total of 30 companies, ranging from textile to ceramics and packaging. Now it is one of the largest conglomerates in the country, employing some 44,500 people with $870 million annual turnover.
The group expects its annual turnover to reach more than $1 billion at the end of the current fiscal year, up 15% year-on-year.