Industry Prospective

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E-Governance

From general economics point of view digitization can benefit an emerging market like Bangladesh more than it can benefit a developed market. Developed countries rely chiefly on domestic consumption, which makes no tradable sectors important. Across developed economies, digitization improves productivity and has a measurable effect on growth. However, the result can be job losses because lower skill, lower-value-added work is sent abroad to emerging markets, where labor is cheaper. By contrast, emerging markets are more export-oriented and driven by tradable sectors. They tend to gain more from digitization's effect on employment than from its influence on growth. In a nutshell, what digitization takes away from developed market, gives back to an emerging market. If Bangladesh can harness the benefit of digitization, it can be create so many jobs and opportunities.

To understand the stance of Bangladesh's IT/IT Enabled Services industry, a SWOT analysis is presented in the following-

Strengths

  • Abundant, young, trainable labor.
  • Among the lowest IT/ITES labor costs in comparison to India, China and Pakistan.
  • Apparently supportive government and active industry associations..

Weaknesses

  • Quantity, quality and relevance of skilled workforce are inadequate
  • Weak and uncoordinated industry promotion despite a generally negative country image and lack of visibility as a potential IT/ITES destination.
  • Weak, unreliable and inconsistent infrastructure overall.
  • Too much government interest with resulting lack of coordination, fragmented and desperate initiatives.
  • Poor business environment in terms of corruption, time to set up business, and recent security challenge
  • No cohesive workforce development initiatives targeting youth or females.

Opportunities

  • Global financial crisis means companies are looking for places to cut additional costs, a possible opportunity for Bangladesh, with low labor cost, to access the market
  • IT Park-type activity to define a manageable space within which the larger issues of infrastructure, policy and image can be more successfully addressed

Threats

  • Resource crunch as skilled labor is taken by other business sectors
  • Declining number of enrollments in IT courses
  • Insufficient English proficiency to capture ITES related business opportunities including call centers
  • Lack of action in addressing infrastructure issues, policy and regulatory framework to improve business environment
  • Potential for strikes ('hartals') and shutdowns that could paralyze commercial activity