A gravity model approach incorporate with Bangladesh textile and clothing industries

Abstract

This study's goal is to identify the factors and problems that affect Bangladeshi textile and garment import and export. Over a period of 15 years, from 2005 to 2015, a special data set was created and use the panel gravity model of Bangladeshi import and export flows to a total of its 27 trading partners.The findings demonstrate that Bangladesh's textile export trade appears to be significantly influenced by the real exchange rate, per capita GDP, and gross domestic product (GDP) of the importers. Four-fifths of Bangladesh's total export earnings come from textile and apparel, the nation's largest and most significant export categories. The international economy has still been negatively impacted by the 2007–2008 financial crisis.The export growth of the majority of countries worldwide has been severely impacted by the recession. The United States, the largest economy in the world, had a sharp fall, which reduced worldwide demand for RMG (ready-made garments) products. Therefore, the study has attempted to illustrate how Bangladesh might boost its economic growth by importing garments to suit market demands. Through the use of panel data analysis, which involves the collection of both dependent and independent variables as well as unit root testing of the data, the study will be explained. The study has attempted to demonstrate crucial factors that can drive Bangladesh's economic growth through the export and import of garment items on the international market.