Government must fully privatise BTCL
Tuesday, 30 September 2008
Mehdi Musharraf Bhuiyan
Increased market competitiveness and liberalization process through the establishment of a 'pro-competitive regulatory regime' for the telecommunication sector, as the international evidence suggests; is the key for transforming Bangladesh into a regional leader in Information and Communication (ICT) sector.
With that particular view in mind, the government must step towards fully privatizing Bangladesh Telecommunications Company Limited (BTCL) within the shortest time frame as well as publishing a clear roadmap for sale within 18 to 24 months.
This view has been expressed by Chris Parker, the Project Team Leader of the 'National ICT Roadmap/Action Plan for Bangladesh,' in an exclusive interview with FE recently.
The project is aimed to outline the national strategies for the advancement of the ICT sector in Bangladesh over the next five years.
BTCL, the successor of Bangladesh Telegraph and Telephone Board (BTTB), started its journey on July 1, 2008. The Bangladesh government initially owns all of its shares but it is set to offload shares in the next one year for public.
"Increasing the market competitiveness in the ICT sector is the key," he said while evaluating the greatest obstacles that has denied the country the same growth achieved by some other countries in the region.
"Our roadmap, above all prioritizes the empowerment of citizens which is aimed at assuring 'Universal Community Based Access to ICT'. The goal is that, by 2013 all Bangladeshi citizens and SMEs have access to ICT within their community as well as have the skills to use them", he envisioned.
"But one of the greatest obstacles that has hindered the progress with respect to that is high cost of bandwidth and other charges and expenses related to ICT," he observed. "And due to the high cost associated, the overwhelming majority of the population is still deprived of the Internet and other IT facilities," he explained.
"In a competitive market fostered by increased liberalization and privatization, the bandwidth cost and other associated expenses will automatically come down, bringing the price down to a level affordable to the common people and thus increasing its access," Parker envisaged.
Despite a strong growth rate since 2000- although from an extremely low base of 0.15 percent of the population, there are still only 1.2 PCs per 100 people in Bangladesh. Charge of broadband internet connections and connections of other bandwidth is also quite high.
"International evidence also suggests that a privatized, competitive telecommunications market contributes more to GDP growth, to taxation revenues for government, and to employment levels than do public sector monopolies, Parker affirmed.
"One great lesson from the success of telephony which has seen some robust growth in the recent years is once the market has been liberalized through the enacting of the Telecommunications Act of 2001, a proper environment for healthy competition has been created," he amplified.
"The same successful policies of telephony can be replicated to other areas of ICT as well," he suggests.
"The National ICT Roadmap/ Action Plan, which is going to replace the IT Policy of 2002 has recommended five key work streams in the roadmap including empowerment of citizens, transformation of public services, growth of the ICT sector, enabling the market as well as leadership and governance," Chris Parker who is also the Managing Director of UK-based Gov3 Limited, informed
"These work streams were then broken down into 14 'Mission Critical Programmes', which individually addresses issues like universal access, e-Bangla, ICT in education, access to finance and developing skills," he added.
According to the draft report, the size of the IT market excluding telecom in Bangladesh is estimated to be US$300 million in total; of which the software and ITES industries share 39 per cent (US$117 million).
The report said as of now, there are close to 500 software and ITES companies in Bangladesh, employing over 12,000 ICT professionals.
Despite a whopping 620 per cent growth of export in the ICET sector in the last five years which now stands to US$ 26 million, Bangladesh is suffering from a lack of international awareness of its benefits as a outsourcing location and ICT trading partner.
Parker, however blames the country's relatively sluggish educational system; which is not always keeping itself up with the skill demand of an industry so vibrant and constantly changing.
"Albeit having the advantage of basic English language skills, a very price-competitive labor force and significant tax and VAT exemptions to IT industry, there is an evident shortage of international standard higher level skills in the ICT sector,"
"The ICT skills attained through higher education must address the continuously changing demand of the industry as the relevant technologies and international markets develop," he asserted.
"That's why the Roadmap have also laid special emphasis on integrating education and ICT. It wants to ensure that, by 2013, all Bangladeshi secondary school children have access to ICT - not only for the development of basic ICT skills, but also to use ICTs for e-Learning,"
We hope that, by 2013, all secondary and higher secondary educational institutions will have an ICT Lab with access to all the curriculum materials, teacher training and support needed.
Also, there have been concerns from different corners that lack of access to debt and equity financing is constraining the supply of capital required for ICT venture.
The ICT Roadmap aims to address it by refocusing the Equity Entrepreneurship Fund as a vibrant and effective source of venture capital funding for ICT businesses as well as addressing market barriers to the effective provision of debt financing to the ICT sector,
"At the same time, the corporate tax holiday for software and ITES sector must be extended for at least five years of the ICT Roadmap," he recommends.
Also, to promote Bangladesh as a highly potential destination for ICT outsourcing, Parker stressed on a brand-led marketing campaign built on the country's current strength at international level through participation in international events and road shows as well as international collaboration and support for export.
Increased market competitiveness and liberalization process through the establishment of a 'pro-competitive regulatory regime' for the telecommunication sector, as the international evidence suggests; is the key for transforming Bangladesh into a regional leader in Information and Communication (ICT) sector.
With that particular view in mind, the government must step towards fully privatizing Bangladesh Telecommunications Company Limited (BTCL) within the shortest time frame as well as publishing a clear roadmap for sale within 18 to 24 months.
This view has been expressed by Chris Parker, the Project Team Leader of the 'National ICT Roadmap/Action Plan for Bangladesh,' in an exclusive interview with FE recently.
The project is aimed to outline the national strategies for the advancement of the ICT sector in Bangladesh over the next five years.
BTCL, the successor of Bangladesh Telegraph and Telephone Board (BTTB), started its journey on July 1, 2008. The Bangladesh government initially owns all of its shares but it is set to offload shares in the next one year for public.
"Increasing the market competitiveness in the ICT sector is the key," he said while evaluating the greatest obstacles that has denied the country the same growth achieved by some other countries in the region.
"Our roadmap, above all prioritizes the empowerment of citizens which is aimed at assuring 'Universal Community Based Access to ICT'. The goal is that, by 2013 all Bangladeshi citizens and SMEs have access to ICT within their community as well as have the skills to use them", he envisioned.
"But one of the greatest obstacles that has hindered the progress with respect to that is high cost of bandwidth and other charges and expenses related to ICT," he observed. "And due to the high cost associated, the overwhelming majority of the population is still deprived of the Internet and other IT facilities," he explained.
"In a competitive market fostered by increased liberalization and privatization, the bandwidth cost and other associated expenses will automatically come down, bringing the price down to a level affordable to the common people and thus increasing its access," Parker envisaged.
Despite a strong growth rate since 2000- although from an extremely low base of 0.15 percent of the population, there are still only 1.2 PCs per 100 people in Bangladesh. Charge of broadband internet connections and connections of other bandwidth is also quite high.
"International evidence also suggests that a privatized, competitive telecommunications market contributes more to GDP growth, to taxation revenues for government, and to employment levels than do public sector monopolies, Parker affirmed.
"One great lesson from the success of telephony which has seen some robust growth in the recent years is once the market has been liberalized through the enacting of the Telecommunications Act of 2001, a proper environment for healthy competition has been created," he amplified.
"The same successful policies of telephony can be replicated to other areas of ICT as well," he suggests.
"The National ICT Roadmap/ Action Plan, which is going to replace the IT Policy of 2002 has recommended five key work streams in the roadmap including empowerment of citizens, transformation of public services, growth of the ICT sector, enabling the market as well as leadership and governance," Chris Parker who is also the Managing Director of UK-based Gov3 Limited, informed
"These work streams were then broken down into 14 'Mission Critical Programmes', which individually addresses issues like universal access, e-Bangla, ICT in education, access to finance and developing skills," he added.
According to the draft report, the size of the IT market excluding telecom in Bangladesh is estimated to be US$300 million in total; of which the software and ITES industries share 39 per cent (US$117 million).
The report said as of now, there are close to 500 software and ITES companies in Bangladesh, employing over 12,000 ICT professionals.
Despite a whopping 620 per cent growth of export in the ICET sector in the last five years which now stands to US$ 26 million, Bangladesh is suffering from a lack of international awareness of its benefits as a outsourcing location and ICT trading partner.
Parker, however blames the country's relatively sluggish educational system; which is not always keeping itself up with the skill demand of an industry so vibrant and constantly changing.
"Albeit having the advantage of basic English language skills, a very price-competitive labor force and significant tax and VAT exemptions to IT industry, there is an evident shortage of international standard higher level skills in the ICT sector,"
"The ICT skills attained through higher education must address the continuously changing demand of the industry as the relevant technologies and international markets develop," he asserted.
"That's why the Roadmap have also laid special emphasis on integrating education and ICT. It wants to ensure that, by 2013, all Bangladeshi secondary school children have access to ICT - not only for the development of basic ICT skills, but also to use ICTs for e-Learning,"
We hope that, by 2013, all secondary and higher secondary educational institutions will have an ICT Lab with access to all the curriculum materials, teacher training and support needed.
Also, there have been concerns from different corners that lack of access to debt and equity financing is constraining the supply of capital required for ICT venture.
The ICT Roadmap aims to address it by refocusing the Equity Entrepreneurship Fund as a vibrant and effective source of venture capital funding for ICT businesses as well as addressing market barriers to the effective provision of debt financing to the ICT sector,
"At the same time, the corporate tax holiday for software and ITES sector must be extended for at least five years of the ICT Roadmap," he recommends.
Also, to promote Bangladesh as a highly potential destination for ICT outsourcing, Parker stressed on a brand-led marketing campaign built on the country's current strength at international level through participation in international events and road shows as well as international collaboration and support for export.