Published : Friday, 30 September, 2022 at 12:00 AM Count : 1577
Enamul Hafiz Latifee
With business services growing by 9 percent and Information Technology Outsourcing (ITO) by about 20 percent in 2021, the global business and technology industry is seeing the biggest commercial boom since the dot.com era. These present prodigious opportunities as companies embark on digital transformation. But this process does come without challenges to face. The biggest challenge facing the ICT industry of the world right now is the talent crisis. The United States of America (USA) alone has 0.24 million tech vacancies, with software developers being in high demand, meanwhile, the computer and mathematical occupational groups are projected to experience much faster than average employment growth of 15.4 percent through 2031.
Expected strong demand for IT services, including cybersecurity services and cloud computing, will fuel demand for computer occupations. For mathematical occupations, expected robust growth in data, in part related to Internet of Things (IoT) and the connectivity of consumer products, industrial machinery and demand for data to be collected and analyzed are the main factors behind strong projected employment growth. Three computer and mathematical occupations are featured among the ten fastest growing occupations: i) data scientists, ii) information security analysts, and iii) statisticians. In addition, software developers are expected to see the third-largest increase in jobs of any occupation over the 2021?31 decade.
The largest ICT exporter in the world-India-the traditional IT/ITES sourcing hub, is also experiencing a shortage in skilled human resources. To understand how deep the crisis is, we need to recall that India's ICT industry is a US$ 227 billion industry that employs over 5 million professionals and contributes 9 percent to India's GDP (including e-commerce). When such a gigantic ICT sourcing destination faces managing the regular flow of quality human resources, then, all other countries dependent on that market start facing the same music. However, this crisis is further aggravated by the Ukraine-Russia war, as many LDCs and developing countries including the developed western countries are now trying to embrace 4IR Techs in an accelerated way to keep up the pace of productivity in the face of energy insecurity and recently exposed food supply-chain vulnerability.
Meanwhile, the smart transformation of many middle eastern countries for going totally paperless like the United Arab Emirates and the flagship 'future city' project of the Kingdom of Saudi Arabia-NEOM-tended to be equipped with smart technologies and renewable energy techs for ensuring the circular economy is posing high demand on hunting top-notch ICT talents. As such, for remaining at the central point of technological innovation and competitive enough for leading the future, the USA tech industry is looking for other delivery destinations and service providers. Bangladesh is a clear alternative, but, it has some tough competitors too, such as Viet Nam, Philippines, and Pakistan.
However, USA is the largest export destination for Bangladesh's ICT industry accounting for 34 percent of Bangladesh's ICT exports. Besides, USA is the largest ICT market in the world representing 33 percent of the total or approximately US$ 1.8 trillion market size in 2022 with more than 0.52 million software and IT services companies collectively contributing 9.3 percent to the US GDP making them the top ICT export destination for Bangladesh as the USA has also the highest ICT spending per-capita. Until 2024, the market is projected to continue growing. Research predicts that the sector's compound annual growth rate (CAGR) will remain stable at 5 percent per year, which offers Bangladesh a significant opportunity.
Addressing it rightly, the Non-resident Bangladeshi (NRB) engineers are consolidating their position with their professional skills and integrity in the USA market to ensure a strong footing in the ever-growing global ICT sector. A good number of Bangladeshi engineers have established their own engineering, information and communication technology (ICT) firms in the USA carrying out high-end ICT functions globally. These NRB-owned firms are working with global tech giants like Microsoft, Intel, Cisco, and Tesla under different categories and involved in providing necessary ICT services. Laying down more emphasis on the collaboration in the field of ICT, recently, on 22 September 2022, Bangladesh Prime Minister Sheikh Hasina invited US investors to invest in the ICT sector of Bangladesh citing its competitive wage and abundant number of ICT freelancers, saying, "Even if required, we would be happy to offer a dedicated 'Special Economic Zone' for the US investors".
Digital Bangladesh has long been a vision of the Bangladesh Government to bring about wholesome development and prosperity by 2021 through ICT. The tech sector has been an integral part of the Bangladeshi vision for development which projects transition into a knowledge-based and cashless developed country that we term 'SMART Bangladesh' by 2041. This vision draws upon the potential and strength of digital government, human resource development, IT industry and citizens' connectivity which are termed as SMART Citizen, SMART Government, SMART Society, and as a whole the SMART Economy. Japan has been instrumental in extending its knowledge support to Bangladesh in formulating an 'ICT 2041 Masterplan' with a view to making this vision a reality.
In keeping with this vision, the government declared ICT as the 'product of the year' to further boost this sector. It is not only just a declaration but provides a potent platform to take this call to the next level by focusing on capacity development, start-up ecosystem simplification, local market development, and persistent promotion highlighting the potential areas of future collaborations with trusted partners.
This sector now intends to leverage status of 'product of the year' to at least contribute to boosting ICT exports to US$ 5 billion by 2025. And it is not just another wild dream. The ICT industry is indeed progressing in the right direction and gradually becoming one of the enablers of the entire national economy. For instance, ICT exports recently registered US$ 1.4 billion reaching 137 export destinations in FY2021-22 with almost 100 percent value-addition done locally, while, holding US$ 1.6 billion equivalent market share in the domestic market. This has led the ICT sector to contribute 1.28 percent to the US$ 465 billion-sized national GDP creating 300,000 jobs directly-- predicted to reach 500,000 by 2025.
Interestingly, besides these institutional achievements, our individual ICT freelancers are grabbing the attention of the world market and especially of USA. Bangladesh now ranks 2nd in the world in digital outsourcing with 14.5 percent of ICT freelance workforce, 5th in Asia in internet usage, 7th in setting up the world's largest data centre, 9th among mobile phone users in the world, 9th among social media users, 12th among smartphone users, and 57th to launch its satellite. All these rationalize for widening the window by USA ICT procurers utilizing the ICT freelancers with their uninterrupted availability given by the solid ICT infrastructure and tech-savviness.
Bangladesh is now dubbed as a 'development miracle' and has becomeknown as the land of immense opportunities and a role model for many countries. With generous exemptions and attractive incentives like the possibility of full profit repatriation and full corporate income tax exemption for ICT business till 2024 which is positively expected to be extended to 2030-- Bangladesh sets itself as the most attractive foreign investment destination in South Asia.
if a bilaterally arranged value-chain among the ICT business communities of the USA and Bangladesh is explored further, it can be proven as a game-changer in axing the increasing operational costs for the buyer-side of the USA while providing an opportunity for Bangladesh in exchanging technological knowledge with an advanced country, as a whole giving an edge to fight the likely economic stagflation to surf through and supercharge the economic growth. The writer is a policy & trade economist, joint secretary (research fellow), Bangladesh Association of Software and Information Services (BASIS)