From 100 to 4 factories - How Chinese dumping wiped out the local silk industry

Marzan Akter (not her real name) is standing in a showroom of Sopura Silk Mills, browsing through various items on sale. 

There is an array of other items on display – from jeans to imported lehenga – besides silk products. A salesman manages to convince her to buy an Indian lehenga at a discounted price, beside the silk saree she already purchased.     

Silk stores selling all sorts of items is nowadays a fairly common scene at showrooms of the silk factories in Rajshahi.
 
“We have resorted to selling different items of clothing as earnings from silk dresses are not enough to make a living,” said Mongol Chandra Saha, an account assistant at a showroom of Sopura Silk Mills, the country’s largest silk producer.

 “If we don’t sell other clothes, it will be impossible to run the shop on the limited profit silk generates,” said Md Sayedur Rahman, manager at the mills.

The silk city

Silk factories were once a resplendent feature of Rajshahi. From as early as the 13th Century, Rajshahi has been known for its locally-produced fine silk. The city became known as ‘Silk City’.

The silk produced in Rajshahi was known as ‘Bengal Silk’ or ‘Ganges Silk’. Considering its prospects and renown, the erstwhile Pakistan government started to produce silk officially. It established a silk factory in Rajshahi in 1961. 

Silk farmers in Rajshahi and neighbouring districts produced high quality silk from the larvae of moths fed on fresh mulberry leaves. There are three types of silk- Mulberry, Endi and Tassar - produced in Rajshahi. Mulberry silk is the finest and most expensive. The weather in Rajshahi and its adjacent areas is particularly favourable to mulberry tree cultivation. 

In the early 1990s, when the industry was it its peak, there were over 100 silk factories. 

Today, there are only four left -  Sopura Silk Mills, Usha Silk Mill, Rajshahi Silk-Fashion and Rajshahi Silk-Amena.

Meanwhile, the silk factory set up by the Pakistan government - handed over to Bangladesh Sericulture Development Board in 1978 - closed down on November 30, 2002 after incurring heavy losses. 

A curse in disguise

Before the entry of Chinese silk into Bangladesh, the entire industry was run through local yarn.

Some 20-odd factories in the 1970s and early 1980’s produced some 80-90 tonnes of silk annually, according to BSDB data, procuring a kilogram of yarn from local producers at Tk1,200.

When Chinese yarn first arrived in the market in the 1980s, it proved to be a boon for local factories as the price dropped to Tk900 per kg. Buoyed by cheap supply, the number of local factories shot up from 20 to 100.

“During that time, our mills produced silk profusely and sold them to retailers across the country,” said Sayedur, who has been working at Sopura Mills for more than 30 years.

As Chinese yarn took over the market, local producers died out. At present, local producers supply only 41 tonnes of silk yarn against a demand of 500 tonnes.

With no competition around, China began hiking the price of yarn excessively. At present, the price of one kg of Chinese yarn is around Tk 7,000 per kg. 

“We used to sell a silk saree at an average price of Tk 500. Now the price is about Tk 5,000,” added Sayedur. High quality sarees can sell up to Tk20,000 in the market.

Although, locally-produced yarn costs around Tk4,000 a kg now, there is very little supply in the market as most local silk yarn producers have left the industry.  

 Reweaving silk

To revitalise the silk industry, the government has taken a plethora of initiatives.

To promote sericulture among farmers, the government is providing them with necessary inputs free of cost and imposed a 25 per cent import duty on Chinese yarn in the current fiscal year. The BSDB has proposed the import duty be increased to 50 per cent in the upcoming fiscal.

All kinds of facilities - including free eggs of silkworm, mulberry trees and cultivation cost - are provided to around 2,000 farmers across Rajshahi and Chapainawabganj.

Farmer Mortuza Mistiry of Rajshahi’s Tanore upazila, one of the beneficiaries, said he has produced around 10 kgs of yarn and sold those to the silk mills at Tk4000 per kg.

“My family used to cultivate silkworm since long, but stopped the cultivation as the prices of yarn fell drastically,” he said.

The BSDB is also trying to label ‘Bengal Silk’ as a Geographical Indication (GI) product in Bangladesh.

“We are trying to grab the global market again by promoting the famous Rajshahi silk,” said Muhammad Abudul Hakim, director general of the BSDB, adding that they have already sent an application to the Industries Ministry in this regard. 

Five other silk products have received GI tag for India.