For the third day running, Bangladeshi garment workers have clashed with police over wage rates.

UK fashion retailers such as H&M, Tesco, Marks and Spencer and Zara are among the world’s leading companies that source much of their clothing from the factories in the Southeast Asian nation.

Despite the proclamation of a new, improved minimum wage for garment makers being announced by the government on Friday, union leaders have rejected the deal as being well below what was asked. The government has offered 3,000 taka (£27) per month to workers, almost double the previous minimum wage. The unions are holding out for 5,000 taka (£45) which they argue matches the rising cost of living.

With no work being done, the predominantly female labour force in Bangladesh’s second-largest industry have taken to the streets, where, urged on by union leaders, they have protested with bitter abuse and throwing stones – in some cases bricks – causing authorities to respond with batons and rubber-bullets. Around 80 people have been injured in the latest clashes, which are taking place across the country, taking the total number close to 300. Police have also claimed that in the outskirts of the capital Dacca, where at least 20 factories have closed, protesters have looted shops and blocked roads.

Bangladeshi Prime Minister Sheikh Hasina has called on workers to prevent major damage to the industry and livelihoods by accepting the new offer. A peaceful resolution is seen as crucial to sustaining the £10bn export sector, which makes up close to 80 per cent of the country’s annual income.

The long-disputed wage structure across garment factories in Bangladesh has at last received some positive news.

After months of protests, many of them ending in violence, the Bangladesh wage board has announced that the minimum wage for garment workers will be almost doubled.

Under the terms of the new arrangement, the average monthly wage will rise from 1,662 taka (£16) to be set at 3,000 taka (£16). A formal announcement of the wage increase will be made by the labour ministry tomorrow. Despite the increase, the wage limit falls short of the 5,000 taka called for by workers.

Leading UK retailers such as Tesco, Marks & Spencer, Zara, Carrefour and H&M all source their clothes from Bangladeshi factories, where the garment industry is the financial backbone of the country’s economy. The industry accounts for some 80 per cent of the nation’s exports and generates around USD$12 billion per year.

Earlier this year, many western fashion labels pressured the Bangladeshi government into reviewing the minimum wage structure after allegations that the country’s factories were using exploitative labour. As a result, the wage board convened an emergency committee made up of union leaders, garment manufacturers and government officials to address the crisis.

The conflict saw angry workers clash with local police in recent weeks and it is not yet clear if union leaders will agree to the new government offer, which, despite the increase, still leaves the garment industry in Bangladesh as one of the world’s lowest paying.

Tens of thousands of garment workers have been subdued by police in Bangladesh.

Tear gas and rubber bullets were used by authorities to disperse the crowds who had gathered to demand higher salaries at a rally just outside of Dhaka.

At the Ashulia industrial area, around 30km north of the capital, workers walked off the job and ransacked several factories in support of protesters campaigning against a three-fold wage hike. Local police Chief Sirajul Islam said police were pelted with rocks and live rounds by the protestors, who blocked the highway out of the area for two hours. Chief Islam confirmed that police used rubber bullets, tear gas shells and water cannons to disperse what were termed ‘unruly workers’, prompting a return of fire which left one officer injured.

Forty police officers were wounded in the fighting, which lasted for three hours, according to Islam. He did not make any statement on how many of the garment workers were hurt in the protest, although the left-wing Garment Workers Unity Forum claimed that more than 100 were injured.

Islam told reporters that around 50,000 garment workers were involved in the protest, which is calling for a minimum monthly wage of 5,000 taka (£48). Currently, workers are paid the minimum wage set down by the 2006 manufacturers, unions and the government agreement of 1,662 taka (£16)

The violence follows a string of labour disputes at the two main apparel hubs of Ashulia and Kanchpur, which produce garments for leading global retailers such as Tesco, H&M and Wal-Mart.