Arvind, one of India’s biggest textile and apparel manufacturers, will invest Rs 270 crores over the next
three years on setting up a joint venture plant in Bangladesh to increase its denim manufacturing capacity by 30 million meters. With this plant, the annual manufacturing capacity of Arvind will increase from 110 million meters to 140 million meters. For this purpose, Arvind is entering into a 80:20 joint venture with Bangladesh’s Nitol Group. Nitol also has a joint venture with the Tata Group and VIP Industries in Bangladesh.
It may be noted that garments manufactured and exported from Bangladesh, which is categorized as a less-developed country (LDC), do not attract any import duty. Also its wage cost is the lowest in the world. Moreover, Bangladesh, which exports $10 billion worth of garments annually, is among the fastest growing garment exporters in the world, given its lower wages and higher productivity. The demand for denim fabrics in Bangladesh is growing at 25 per cent and is currently at 280 million meters. Out of this, 180 million meters are being manufactured locally and 100 million meters are imported.
Arvind’s new unit first phase of 10 million meters will be set up within a year with an investment of $25 million. Arvind's joint venture partner Nitol Group has a turnover of $100 million. Arvind is the third largest producer of denim in the world and exports to 70 countries worldwide. The company’s clientele includes GAP, VF Corporation, Levi Strauss, Abercrombie & Fitch, and Calvin Klein. Its designers are based out of Japan, Europe and the US who create trend setting collections for the season.