AI-Powered IoT Monitoring Boosts Bangladesh RMG Productivity by Up to 25%

Reyad Hossain, Dhaka — Bangladeshi readymade garment exporters are increasingly installing artificial intelligence-driven Internet of Things (IoT) devices on their production lines to boost productivity and maintain global competitiveness — with some factories reporting gains of up to 25 percent compared with manual monitoring.

Some factories have installed the technology on part of their production lines, while others have connected every sewing machine to the system. Industry sources said a significant number of major export-oriented factories are planning to introduce similar technology in the coming months.

👥 Factories Using AI-IoT Systems

Factories currently using such systems include:

• 👕 Snowtex Group — Dhamrai (largest adopter, 10,000 machines)
• 👕 Fatullah Apparels — Narayanganj (first adopter, late 2020)
• 👕 Team Group — Savar (partial deployment)
• 👕 Yunusco Group — Adamjee EPZ factory (partial deployment)
• 👕 Sparrow Group — Bhaluka, Mymensingh (50% deployment)

An IoT-based production monitoring system was first introduced at the production stage by Fatullah Apparels in late 2020, according to industry sources — marking the beginning of AI-driven digital transformation in Bangladesh's RMG sector.

🏛 Snowtex Leads Large-Scale Adoption

Snowtex Group appears to have introduced the technology on the largest scale among the factories contacted by The Business Standard. During a visit to a Snowtex factory in Dhamrai, IoT devices were seen attached to sewing machines across the production floor. Company officials said the devices have been in use since 2023 on all around 10,000 sewing machines across its factories.

SM Khaled, Managing Director of Snowtex Group, said the company had observed a productivity increase of up to 25 percent after introducing the system. "Our observation is that productivity has increased by up to 25 percent compared with the manual system," he said.

💻 How the AI-IoT System Works

The system allows factory managers to see real-time production by individual machines and operators. Key technical features:

• 💻 IoT device on each sewing machine — connected to operator ID
• 💻 Real-time production monitoring by machine and operator
• 💻 Defect detection — problems displayed on central screen
• 💻 Machine vs operator problem identification
• 💻 Central monitoring system across factory floor
• 💻 Mobile app for problem resolution recording
• 💻 Cross-factory database at Snowtex (all factories networked)

When a problem is resolved, the responsible employee can record the action through a designated mobile application. This allows managers to identify who addressed the problem and how long it took to resolve.

👥 Other Adopters: Sparrow Group and Others

Sparrow Group began using the system about six months ago. The company, which exports around $350 million a year, has installed the devices on about half of its sewing machines, said its Managing Director Shovon Islam.

"We have observed a 5% to 10% increase in productivity compared with the manual system," he said. Sparrow plans to install the devices on all its sewing machines by 2027, he added, noting that the system is used to monitor both productivity and quality.

Ha-Meem Group, DBL Group, Urmi Group and Fakir Fashions are among the other major exporters planning to introduce production monitoring systems, industry sources said — indicating that AI-IoT adoption is becoming an industry-wide trend rather than an isolated experiment.

👥 Worker Production Incentive Bonuses (PIB)

The introduction of digital monitoring is also being accompanied by more specific production targets and incentive schemes for workers:

• 💰 Hourly production targets set for operators
• 💰 Production Incentive Bonuses (PIB) for workers meeting targets
• 💰 Bonuses based on production performance and defect rates
• 💰 Lower defect rates = higher incentive bonuses

Afizul, a Snowtex worker, said the introduction of PIB had created an opportunity for workers to earn an additional Tk 2,000 to Tk 3,000 a month on average. Sharmin Akter, an operator at the factory, said she earns around Tk 2,000 a month in additional bonuses after the new targets were introduced. Including overtime and other benefits, her monthly earnings have reached as much as Tk 28,000, she said.

⚠️ Labour Leaders Raise Concerns

Labour leaders, however, argue that technology-driven productivity targets could increase pressure on workers. Nazma Akter, Executive Director of Awaj Foundation, said workers could be expected to produce more than their physical capacity as factories adopt new technologies in the name of industrial engineering and higher productivity.

She argued that the additional incentives were insufficient to compensate workers for the increased pressure. Interviews with workers produced mixed responses:

• ⚠️ One worker at a Dhaka factory said her hourly production target had increased from 28-30 pieces to 35 pieces after the introduction of digital monitoring
• ⚠️ Workers face higher physical pressure to maintain machine uptime
• ⚠️ Defect rate reduction pressure on individual operators
• ✅ Workers earn Tk 2,000-3,000 additional monthly income through PIB
• ✅ Total monthly earnings (with overtime) reach Tk 28,000 for some workers

📊 Strategic Context: AI in Bangladesh RMG

The AI-IoT adoption trend comes at a strategically important moment for Bangladesh's RMG sector:

• 📊 FY26 RMG net earnings: only 0.96% growth to $38.97 billion
• 📊 EU apparel exports: fell 16.4% in H1 2026
• 📊 660 textile mills affected by gas shortage affecting supply chain
• 📊 Matrix Dresses closure: smaller factories closing amid cost pressures
• 📊 LDC graduation: November 2026 reduces EU preferential access
• 📊 REER at 103.93: Taka overvaluation weakening competitiveness
• 📊 US tariff rate: 25.6% (slight edge over China and Vietnam)

The combination of these pressures has created strong commercial incentive for RMG factories to invest in productivity-enhancing technology — with AI-IoT monitoring emerging as one of the most accessible and impactful interventions available.

🌏 Strategic Implications

The AI-IoT adoption trend carries several strategic implications for Bangladesh's RMG sector:

• ✅ Productivity gains: 5-25% improvements materially enhance competitiveness
• ✅ Real-time visibility: production problems identified and resolved faster
• ✅ Quality improvement: defect tracking supports higher compliance standards
• ✅ Worker incentive alignment: PIB bonuses reward higher production
• ✅ Industry-wide trend: major groups (Ha-Meem, DBL, Urmi, Fakir) planning adoption
• ⚠️ Worker pressure concerns: labour leaders flag capacity strain
• ⚠️ Incentive adequacy: Tk 2,000-3,000 may not offset increased pressure
• ⚠️ Target ratcheting: 28-30 to 35 pieces per hour at one factory
• ⚠️ Investment cost: AI-IoT deployment requires capital expenditure

The AI-IoT monitoring adoption trend represents one of the most significant technological transformations in Bangladesh's RMG sector in recent years — with the potential to materially improve the sector's productivity and competitiveness through the LDC graduation transition period. However, the worker pressure concerns raised by labour leaders highlight the need for balanced implementation — ensuring that productivity gains translate into improved worker welfare rather than simply higher output targets. The coming 12-24 months will determine whether AI-IoT becomes a sustainable win-win for both factory owners and workers, or whether it exacerbates the sector's existing labour-management tensions.