The government will provide technical and financial assistance to tanneries that have yet to resume production after being relocated to the Savar Leather Industrial Estate, Commerce, Industries, and Textiles and Jute Minister Khandaker Abdul Muktadir has said.
However, he warned that no tannery failing to comply with environmental regulations would be allowed to operate.
He said the government was giving top priority to ensuring environmental standards, modernising waste management and securing international certifications to enhance the global competitiveness of Bangladesh’s leather industry.
The minister made the remarks while addressing a programme titled Bangladesh-Netherlands Sustainable Trade Forum 2026 and Launch of CBI Home Textiles and Leather Programme at the Sheraton Hotel in the capital on Wednesday.
The event was jointly organised by the Netherlands-based Centre for the Promotion of Imports from Developing Countries (CBI) and LightCastle Partners.
Highlighting the export potential of Bangladesh’s leather and leather goods sector, Muktadir said the country exported approximately $1.78 billion worth of leather and non-leather products last year.
He identified the European Union as a major and promising market for Bangladesh, while neighbouring India had also emerged as one of the key buyers of Bangladeshi leather products.
To fully harness this potential, he stressed the need to improve product quality, ensure environmental compliance and develop production systems in line with international market requirements.
Referring to the prolonged process of relocating tanneries from Hazaribagh to Hemayetpur in Savar, the minister said the delay had hindered the development of the leather industry.
The government was now taking effective initiatives to address the sector’s existing challenges, he said, adding that technical and financial assistance would be provided to help non-operational tanneries resume production.
The minister also announced that every factory covering 50,000 square feet or more would be required to install its own Effluent Treatment Plant (ETP).
In addition, all tanneries in Savar would have to obtain certification from the international Leather Working Group (LWG). He stressed that there would be no compromise on environmental standards and regulatory compliance.
He said initiatives were also being taken to enhance the capacity of the Central Effluent Treatment Plant (CETP) at the Savar Leather Industrial Estate and install an advanced chromium recovery unit to improve waste management.
Successful implementation of these measures would help Bangladesh’s leather industry secure a stronger position in international markets, he added.
Highlighting the importance of the cottage, micro, small and medium enterprises (CMSMEs) sector, Muktadir said its development was essential for inclusive economic growth, employment generation and reducing income inequality.
He noted that the CMSME sector currently contributes less than one-fourth of the country’s gross domestic product (GDP). He stressed the need to raise its contribution to at least 60% to help reduce economic disparities.
The minister also emphasised removing barriers to financing for small entrepreneurs, saying complicated documentation and procedural requirements for bank loans often prevent promising entrepreneurs from accessing necessary funds.
To address the problem, the government was taking steps to restructure the SME Foundation so that small and medium-sized entrepreneurs could more easily access institutional support and credit facilities.
He said the allocation for the SME sector’s loan refinancing programme had been increased from Tk 300 crore to Tk 2,000 crore since the current government assumed office.
The programme has recorded a loan recovery rate of 98%, which he described as a positive example of the financial discipline and capabilities of small and medium-sized entrepreneurs.
Emphasising stronger bilateral trade relations between Bangladesh and the Netherlands, Muktadir said cooperation between the two countries could create new opportunities in sustainable industrialisation, technology transfer, skills development and access to international markets.
He said the Netherlands’ technological expertise and institutional experience could play an important role in making Bangladesh’s export-oriented sectors, particularly home textiles and leather, more competitive.
The minister appreciated the support extended by the Dutch government, CBI and development partners for the advancement of Bangladesh’s SME and leather sectors.
He also expressed the government’s commitment to strengthening the country’s position in global markets through sustainable production, environmentally friendly industrialisation and export diversification.
The programme also discussed ways to expand sustainable trade between Bangladesh and the Netherlands, strengthen industrial cooperation and develop international markets for home textiles and leather products.
The CBI Home Textiles and Leather Programme was formally launched at the event, focusing on enhancing sectoral capacity, meeting international market standards and expanding export opportunities.
Netherlands Ambassador to Bangladesh Joris van Bommel attended the programme as a special guest. Judith Arends, managing director of CBI, also spoke at the event.
Representatives from the government and private sectors, development partners, industrial entrepreneurs and other relevant stakeholders were present.
