Domestic value added in Bangladesh’s textile exports: a destination-specific decomposition, 2007–2023

Bangladesh’s textile and clothing sector is central to the country’s export-led industrialisation, yet the strong growth in export earnings has not been matched by clear evidence of domestic value creation. Although Bangladesh has become one of the world’s leading apparel exporters, concerns persist that its integration into global value chains (GVCs) is characterised by limited domestic value gain and dependence on imported intermediate goods. To address these concerns, this study conducts a destination-specific decomposition of Bangladesh’s textile exports using the Asian Development Bank Multi-Regional Input–Output (ADB MRIO) table over the period 2007–2023. By disaggregating domestic value added (DVA) into domestic value absorbed abroad (DAVAX), re-exported domestic value (REX), and returned domestic value (REF), the analysis reveals marked differences in value-capture performance—the domestic income Bangladesh retains per unit of exports, indicated primarily by DAVAX—across major export partners. While export values expanded steadily over the period, domestic value retention stagnated or declined in most destinations, and reliance on foreign intermediate goods intensified. These patterns reflect the functional roles destinations play within value chains: North America absorbs Bangladeshi value directly as final demand (high DAVAX), Europe increasingly channels it through re-export networks (rising REX, lower DAVAX), and Asia–Pacific exhibits mixed, unstable pathways. In typological terms, these correspond to three functional destination types: final-demand markets, re-export and processing hubs, and mixed destinations—categories to which each partner economy can be assigned based on its DAVAX–REX signature. These findings highlight that Bangladesh’s export growth has not translated into proportional domestic income gains, underscoring the need for stronger backward linkages and deeper domestic production capabilities to support meaningful industrial upgrading.