The designer shopping bag aimed at promoting green awareness was made using cheap labour in China, the Standard reveals.
The 'I'm not a plastic bag' bag is a must-have fashion item and 20,000 sold out within an hour at Sainsbury's. Women queued from 3am to get one of the £5 cotton bags made by leading designer Anya Hindmarch and they are changing hands on eBay for £225.
Today Sainsbury's was accused of hypocrisy after it admitted the bag was made in China and was neither organic nor fair trade.
The chairman of an influential Commons committee said Sainsbury's had 'tarnished' its image as a promoter of fair trade products.
A campaign group which highlights the exploitation of workers in the fashion industry said making the bag in China dented the bag's ethical claims.
And the fact that the bags have been sent thousands of miles from China raised questions about whether its carbon footprint is threatening to offset its environmental benefits. A spokeswoman for the supermarket chain conceded the bag, billed as 'making a difference to the world', was 'not perfect' while refusing to say in which factory the bag is made.
Malcolm Bruce, chairman of the international development select committee, said: 'This tarnishes Sainsbury's image as a company that supports fair trade. It should have made a positive attempt to ensure this does not come from potentially exploited sources.'
'This is bordering on the hypocritical,' said Martin Hearson, of pressure group Let's Clean Up Fashion. 'There is an incompatibility in claiming a product is ethical and then manufacturing it in China.'
Mr Hearson claimed workers in the garment industry in China typically are paid 20p to 30p an hour. He also said there were serious issues about the sourcing of the cotton with concerns that cotton which is not fair trade is often picked by child labour.
The 'I'm not a plastic bag' comes with a blue tag which explains the bag offers an alternative to plastic bags which 'have a negative impact on the environment'. No profit is made from the sale of the bag.
A Sainsbury's spokeswoman told the Standard that because the bag was a branded product, made by Hindmarch, 'we're not at liberty to disclose details on the supplier'.
The spokeswoman added: 'I can confirm it [the factory] has been visited to ensure high standards of ethical trading.'
A spokeswoman for Anya Hindmarch said the company made no secret that the bag was made in China, adding: 'We never claimed this bag is perfect. We have just tried to use our influence as a maker of luxury goods to make it fashionable not to use plastic bags.'