Incentives for IT sector


Rahman Jahangir | Published: April 25, 2015 00:00:00 | Updated: November 30, 2026 06:01:00


That Bangladesh has made some striking progress in Information Communication Technology (ICT) is evident from its success stories. It has immense potential for expanding its ICT sector. There has already been a rapid rise in IT freelancing and a greater interest than before, among the country's youths to learn English language. The establishment of 4,547 Union Digital Centres (UDCs), 321 pourasabha (municipal) digital centres and 401 ward digital centres under city corporations has transformed some important public services into online services. Launching of national web portal, containing 25,000 websites of government bodies at various tiers on June 23, 2014, is another step toward ensuring people's right to information.
Over the years, both mobile and internet penetration have significantly increased in the country. Against only 20 million mobile users in 2008, the number rose to 120 million in 2014. In 2008, only 0.4 per cent people used internet while the number of internet users now stands at 27 per cent, according to the figures available from Bangladesh Telecommunication Regulatory Commission (BTRC).
The government has also reduced the price of bandwidth significantly to ensure access on the part of a larger segment of population to internet, aiming to build an economically and technologically advanced Bangladesh. Emphasis is now being given to establishment of ICT infrastructural facilities and expansion of connectivity to promote IT industry. The authorities, as the reports said, are now planning to establish 12 hi-tech parks in different locations in the country as part of the expansion of IT industry although progress in this regard so far is slow. The Kaliakoir hi-tech park located at Gazipur is being constructed on 231.685 acres of land, comprising industrial base, internet roads and science plaza.
The government, along with private sector, has set a target of earning $1.0 billion as export receipts from IT sector in the next five years. Bangladesh's ICT export already showed an upward trend last year. The software export increased to over $100 million in the fiscal year (FY), 2013-14. However, the local software developers and exporters claimed the export earnings to be around $200 million in the same fiscal.
In the FY 2007 and 2008, the government allocated only Tk 170 million for ICT sector. This allocation has been rising over the recent years and is likely to rise further, in the forthcoming fiscal. The enhancement is obviously purported to making it possible to turn Bangladesh into a middle income country by 2021, with the ICT playing an important role in the process. The price of megabite per second (Mbps) bandwidth was markedly reduced to Taka 2,800 in 2014 from Taka 76,000 in 2007. The coverage of third generation mobile broadband services reached 64 district towns by 2014.
Now is the right time to give emphasis on creating IT-efficient people by imparting them ICT knowledge to help accelerate the development process of the country. Bangladesh, according to competent experts, needs to create up to 80-85 per cent of IT-skilled people to meet demand of both local and global markets. Quite a large number of youths, running into millions, have already registered with different international online marketplaces like elance-oDesk. Earnings from such outsourcing reportedly exceeded $50 million last year.  In line with its plan to build Digital Bangladesh as chartered out in the 'Vision-2021', the government should put its thrust on the use of ICT for improving productivity, governance, service delivery and on further development of IT industry.
Like export of manpower and readymade garments, the ICT can emerge as yet another sector not only to fetch a hefty sum of export receipts but also to help develop a knowledge-based economy. That is why the authorities, while preparing the coming national budget for FY 2015-16, should taken into consideration the recommendations -- most of which are in the nature of fiscal incentives - coming from the Bangladesh Association of Software and Information Services (BASIS), the Bangladesh Computer Council (BCS) and the Internet Service Providers Association, Bangladesh (ISPAB). Incidentally, such organisations are playing important roles in taking the ICT to the stage where it is today.
It is noteworthy that a move has recently been taken to export the country's Internet bandwidth to neighbouring India. The cabinet has approved export of 10 GBPS (gigabite per second) of bandwidth to seven northeastern states of India. An agreement titled 'Leasing of international bandwidth for Internet at Akhaura' will be signed between Bangladesh Submarine Cable Company Ltd (BSCCL) and Bharat Sanchar Nigam Ltd (BSNL).
The agreement is likely to provide a 'win-win' situation for both Bangladesh and India. Bangladesh has now surplus GBPS and India has a demand for extra GBPS. It would be very expensive on the part of India to bring the line from Mumbai. A 22-kilometre optical fibre cable link from Brahmanbaria to Akhaura border will be developed in four months to transport the bandwidth.
Currently, Bangladesh has two hundred GBPS capacity submarine cable. From it, the country is using only 30 GBPS. About 170 GBPS remain unused. And from there, the government has decided to export only 10 GBPS bandwidth. However, its volume can be extended up to 40 GBPS. The term of this agreement will be for three years. The bandwidth will be used in Assam, Tripura, Meghalaya, Mizoram, Nagaland, Manipur and Arunachal state.
In December this year, the second sub-marine cable project will be launched. Then Bangladesh will get 1500 GBPS of bandwidth capacity allowing it to export more. Bangladesh will earn a revenue of Tk 94.2 million per year from the bandwidth export to India. Interestingly, one fourth of the money will cover salary and wages of the officers and staffs of the BSCCL.
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