Staff Reporter  
Rtnn: While the readymade garment industry in the country is facing challenges amid the ongoing dollar crisis, Badsha Group of Industries, a prominent textile manufacturer, aims to achieve an annual turnover exceeding $1.3 billion by FY26, following the approval of around $86.83 million loan from three international financial institutions.

Of the loan amount, $40 million has been approved by the International Finance Corporation (IFC), €25 million (approximately $27.29 million) by the Development Bank of Austria (OeEB), and €17.9 million (around $19.54 million) by the German Export Credit Agency (ECA) LBBW, top officials of the group say.

Top officials of Badsha Group say the foreign funds will be used to set up a state-of-the-art greenfield spinning mill at Madhabpur in Habiganj, with a projected investment of $141 million, which also includes loans from local banks and own funds. This mill will have 1.81 lakh spindles to produce premium cotton, viscose, and blended cotton yarn.

The group has made additional investments in recent times, including a Tk800 crore investment for Pioneer Denim project, aiming for an annual export target of $700 million.

Muhammad Habibur Rahman, executive director (finance and operation) of Badsha Group, told TBS that around $95 million investment for the spinning mill will be secured through loans, comprising $86.83 million from three international financial institutions and around $9 million from local financial institutions.

A consortium of three local banks has committed to financing the project, with Eastern Bank leading the consortium, accompanied by Mercantile Bank and Pubali Bank, he said.

Habibur Rahman further said the remaining investment for the spinning mill is being financed by the group itself.

Badsha Mia, founder of the group, told TBS that the state-of-the-art spinning mill on 300 bighas of land is poised to produce around 200 tonnes of import-substitute yarn per day. As construction advances rapidly, the inauguration of commercial operations for the new spinning unit is slated for November 2024.

In the fiscal year 2023, Bangladesh imported 9.24 lakh tonnes of yarn valued at Tk3,498.36 crore, with the majority consisting of cotton yarn.

Badsha Mia said the newly established spinning unit will serve as the backward linkage industry to bolster its textile mill, Pioneer Denim Limited. Anticipating a turnover of $245 million, Badsha Mia indicated that the venture is expected to generate around 4,000 direct jobs.

Additionally, he outlined the group's target to achieve a turnover of $670 million in the current fiscal year, surpassing the previous year's figure of $600 million.

Currently, Youngone Corporation is the only RMG exporting company in Bangladesh, exporting products valued at $1 billion for the fiscal year 2022-23.

Several other companies in the country, including Ha-Meem Group, DBL Group, Pacific Jeans Group and Team Group are also aspiring to reach the $1 billion export target within the next three to four years.

Government approved foreign loans

According to Economic Relations Division (ERD) sources, the government has granted clearance for the International Finance Corporation (IFC) to provide $40 million in financing to Badsha Group.

Muhammad Habibur Rahman said the remaining two loans have also been approved.

He additionally mentioned that foreign loans will be used to cover the expenses of importing capital machinery. Approximately $72 million has already been expended for opening Letters of Credit (LCs) for this purpose.

He mentioned that the process of opening LCs for an additional $5.5 million to finance the construction of a section of the steel structure for the spinning mill is underway.

More investments

Badsha Group has allocated an investment of Tk800 crore for its Pioneer Denim project in Madhabpur, Habiganj, aiming for an annual export target of $700 million, according to the group's founder, Badsha Mia.

The project involves the construction of two seven-story production units, two storage sheds, and three sheds for dyeing and washing plants.

The construction of a five-story research and development building is nearing completion, with limited-scale operations initiated on one floor with 10 production lines since December last year.

"Production at the unit is set to commence on a large scale in 2024, generating employment opportunities for a minimum of 15,000 individuals," said Badsha Mia.

He further mentioned, "Presently, the group has provided employment to around 27,000 people."

Badsha Mia outlined the group's objective to achieve an annual export of denim garments totaling $700 million by 2028.

In 2000, Badsha Mia founded Pioneer Sweater Limited, followed by the establishment of Badsha Textiles Limited in Bhaluka, Mymensingh, in 2004, and Kamal Yarn Limited in 2010.

Badsha Textiles and Kamal Yarns collectively boast a spinning capacity of 430 tonnes per day.

Additionally, Pioneer Denim Limited, a part of this group, has a fabric production capacity of 65 lakh yards per month.

Target to reach billion dollar turnover

Muhammad Habibur Rahman, executive director (finance & operation) of Badsha Group of Industries, said with these investments, the group anticipates achieving an annual turnover exceeding $1.3 billion by the fiscal year 2026.

He provided a breakdown, indicating that Badsha Textiles Ltd is expected to contribute $280 million, the new spinning mill in Habiganj is forecasted to add $250 million, and Kamal Yarn Limited is projected to contribute $200 million.

Additionally, contributions from Pioneer Denim Limited and Pioneer Knitwears (BD) Ltd are estimated at $400 million and $120 million, respectively, culminating in a grand total turnover of $1.3 billion by FY26, he said.