With regard to infrastructure development and policy support from the government, there have been several noteworthy initiatives and in some cases, blueprints for initiatives.
For instance, the government has initiated the development of a 232-acre hi-tech park to attract investment from multinationals and local investors.
The park is expected to create 70 thousand jobs, contribute to several businesses in the e-commerce value chain, and benefit the industry through technological spillovers.
Moreover, the government is set to revise the Telecom Policy 2012 to render it more customer and investor-friendly.
Consequently, the Ministry of Post and Telecommunication started a public consultation program on March 2015, seeking feedback from consumers and other stakeholders through public websites and SMS service.
The government has also announced that VAT is inapplicable to e-commerce businesses in order to encourage local entrepreneurs. A second submarine cable that is in the planning will enable 4G services and provide bandwidth of 1400 Gbps, compared to the current availability of 200 Gbps (and regular usage of 32Gbps).
Findings from Focus Group Discussions with Industry Experts A recent Focus Group Discussion (FGD) of local e-commerce entrepreneurs deliberated on the current state of the sector, existing challenges, how they are currently being overcome and what ECAB, the government and policy makers could do to assist e-commerce entrepreneurs.
The salient outcomes of the FGD are as follows:
Generally, the FGD participants indicated that lack of awareness of e-commerce’s benefits constitute the most significant barrier to the sector’s growth and development. Buyers will eventually accept and trust e-commerce as a legitimate business sector, but at present, confidence and awareness levels are generally low. The participants recommended that awareness campaigns such as e-commerce fairs be organized across the country to address the existing low level of awareness.
With regard to financing, e-commerce could benefit greatly from government regulations and policies that encourage low-cost financing to this sector. A greater interest in this sector on the part of financial institutions could lead to a win-win situation, considering the scope and potential of this sector. Growth of this sector would also encourage greater entrepreneurial activity, and eventually, more business for financial institutions through loans and other products.
With regard to the paucity of human resources, the participants recommended that there be greater collaboration between e-commerce businesses and universities, via internship programs that aim to build up the skills of potential e-commerce sector employees from the ground-up. The participants also emphasized the inclusion of e-commerce in the academic course curricula as early education can play a pivotal role in creating the skilled human resources essential for the growth of this sector.
The participants also highlighted that general business knowledge is found to be lacking among the general population, who need to be made aware. They thought that the lack of e-commerce sector knowledge is part of a larger lack of business literacy in the country.
Even investors in e-commerce, many of whom belong to influential business houses or families, often demonstrate a lack of technical knowledge essential for investing in and contributing to the operations of an e-commerce business. Ground breaking products and services from individuals without adequate technical support are hardly likely.
Business development information has to be provided to several start-ups to fast track the growth of e-commerce in Bangladesh.
To this end, the industry experts who participated in the FGDs encouraged greater participation by universities, industry associations and trade bodies in working closely with ECAB and the government to strategically catalyze the growth.
This report was first published by the Centre for Enterprise and Society at the University of Liberal Arts, Bangladesh.