Envoy Textile Limited, an export-oriented denim fabric manufacturer in Bangladesh, is one step closer to building a new spinning facility.
Last week, the Asian Development Bank (ADB) announced it has signed a $30 million sustainability-linked loan facility agreement with the mill. The loan will help fund a new spinning unit at Envoy’s manufacturing plant in Jamirdia, Bangladesh. Automated and more energy efficient, it will have an annual yarn production capacity of 4,550 tons, which will be mainly used for in-house production of denim fabrics.
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Funds will also be used to install 3.5 MWp of rooftop solar panels to the factory and to refinance short-term local working capital loans.
ADB is a leading multilateral development bank supporting inclusive, resilient, and sustainable growth across Asia and the Pacific. The agreement with Envoy is the bank’s first sustainability-linked loan in Bangladesh. ADB this type of loan is a “forward-looking, performance-based debt instrument with predefined key performance indicators and assessed against sustainability performance targets.”
The selected sustainability performance targets reflect Envoy’s sustainability objectives including total installed electricity generation capacity of the rooftop solar and the amount of greenhouse gas emissions reduction.
“We are honored to receive continued support from ADB, whose partnership affirms our commitment to sustainable growth and innovation. This new sustainability-linked loan will enable us to expand our production capacity, invest in renewable energy, and further reduce our environmental footprint,” said Kutubuddin Ahmed. Envoy chairman. “Envoy remains dedicated to upholding the highest standards in quality, inclusivity, and sustainability.”
Envoy has an annual production capacity of 54 million yards—about 10 percent of Bangladesh’s total denim fabric capacity. The company has the world’s first platinum Leadership in Energy and Environmental Design (LEED) denim manufacturing facility certified by the United States Green Building Council.
ADM and Envoy joined forces in 2022 when the parties entered into a $11.2 million facility agreement to finance the purchase and installation of energy efficient spinning machinery and other equipment to expand sustainable textile production. It was Envoy’s first-ever financing from an international lender.
“The ready-made garment industry is a key driver of Bangladesh’s economy, accounting for over 80 percent of the country’s total export earnings, and Envoy is the leading denim fabric manufacturer,” said Hoe Yun Jeong, ADB country director for Bangladesh. “ADB is pleased to support Envoy with its first sustainability-linked loan in Bangladesh. This partnership advances environmental sustainability and industrial modernization, setting a new standard for the garment sector.”
