Export earnings from software and IT-enabled services (ITES) sector are increasing rapidly and a 76 per cent higher export growth has already been registered in the first half of the current fiscal compared to the corresponding period of the previous year.
JP Morgan’s positive report regarding Bangladesh as outsourcing destination, low cost and inclusion of Bangladesh by Gartner in its top 30 outsourcing destinations are helping the country to get software export orders, said Mahbub Zaman, president of the Bangladesh Association of Software and Information Services (BASIS).
He said, many global companies are targeting Bangladesh as cost of software development is lower than in India, Sri Lanka and other Asian countries due to its pool of talented young IT professionals, aimed at digital Bangladesh, attractive software exhibitions and positive reports by some of the global consulting agencies.
Order will increase in accelerated rate if Bangladesh is connected with another information highway as an alternative way of communication in case of disruption or collapse of the existing connection with the submarine cable, Zaman said and added that it is important for getting software export orders as the buyers want uninterrupted communication and products within their framed lead time.
During this interim period, there could be terrestrial connection over air to create confidence among the buyers, he said.
To attract a good quantity of software export orders from the huge global market, Bangladesh needs to develop both physical and telecommunication infrastructure, the BASIS president said.
A Tk7 billion (700 crore) proposal is there in the government’s ICT policy but it is yet to see light of the day and in the last budget no fund was arranged. He demanded for at least 10 per cent of the proposed fund in the upcoming budget for ICT development.
For ICT development, the government has arranged tax holiday since 2001 and it would be continued till 2013. Though there is no tax problem now but the government should allocate budget for overall infrastructural development of this sector, an industry insider said and added that to make Internet use favourable and attractive, the government should reduce or totally withdraw tax on its usage.
In the ICT policy, the government is to allocate at least 1 per cent of the revenue budget and 2 per cent of the development budget as expenditure for this sector but the arrangements are yet to be made.
A software exporter, who is also a member of the BASIS, said that the proposed extension of the ICT incubator to Janata Tower of Kawran Bazaar in Dhaka and the ICT Palli (ICT Park) at Kaliakoir in Gazipur are yet to take place.
Sirajul Islam, research associate of the association said, in the last fiscal total export earnings from software industry was about $45.31 million, while in the first seven month of the current fiscal year the export earnings have reached $38.47 million, which is 76 per cent higher than the same time of the previous fiscal. He felt that the total export in the current fiscal may exceed $60 million.
Number of the registered Software and IT-related service companies has exceeded eight hundred and the number of the BASIS membership till April, 2012 are only 511; and out of them about 160 companies are exporting software and ITES to around 60 countries mainly to the US - through NRB linkages, UK, Denmark and Netherlands.
Meanwhile, the government is now on an average earning about $260 million annually in terms of exports and tax revenue. The software and ITES sector now employs nearly 30,000 IT graduates and professionals, the research associate said.