According  to Fazlul Hoque, President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), local knitwear exporters has expressed concerns regarding the plans to change the rules governing duty-free access to the European Union, claiming it would have a 'Cyclone Sidr' like effect on the local industry.

He said under present rules garments made in least developed countries (LDCs) are given duty-free access to the EU if those are produced using local cloth or yarn. However, under new EU proposals this rule will be replaced by a condition that 30% of the products value be added locally. This will allow garment manufacturers to use cloth or yarn from abroad and still gain duty-free access.

Fazlul added that, these proposals would be a 'catastrophe' because they would undermine the backward integration of the industry in Bangladesh, in which a thriving yarn and cloth sector supply the garment producers. The EU proposal would not be viable for the Bangladeshi knitwear sector as it would encourage dumping by China, India and Pakistan, who would export cheap cloth and yarn. He also warned that it would encourage China to set up at least 300 factories in Cambodia within next two years to take advantage of duty-free access.