• Wednesday, Jul 17, 2019
  • Last Update : 04:41 pm

'Infrastructure key to outsourcing business'

  • Published at 09:56 pm June 8th, 2019
BASIS president Syed Almas Kabir
BASIS President Syed Almas Kabir Collected

'The national budget for FY20 should focus on developing infrastructure to reach rural young people with quality internet service at an affordable price to tap the growing opportunity of an emerging outsourcing sector,' Syed Almas Kabir, president of Bangladesh Association for Software and Information Services (Basis) tells Dhaka Tribune’s Ibrahim Hossain Ovi in an interview  

What should the government offer in the budget to create more skilled manpower? 

We have very little international standard skilled human resources, required for the country’s information and technology sector. 

For this, we have to send our young educated people abroad for training and higher education but there is no private scholarship available for that.

In encouraging people in the private sector, the government has to give tax rebates on money spent for training or higher education. In addition, the government should also offer tax rebates to companies who offer scholarships. 

If that is done, we will have a pool of skilled human resources for the sector, who will create more skilled manpower, sharing their knowledge and training others. 

But there must be some conditions or mechanisms so that they return to the country and remain active with the company that pays for the training and education. 

How can Bangladesh utilize the advantage of outsourcing?  

Infrastructure quality and affordable internet service is the number one component for the outsourcing business. If we can provide it, earnings from the sector will rise sharply.

As of now, outsourcing is based in the city mostly, which cannot fully take advantage of global opportunities. 

In tapping opportunities in outsourcing, Bangladesh has to concentrate on developing infrastructure that gives connectivity to local young talent, so they can work sitting at home. 

To this end, the government should focus and make budget allocations to develop infrastructure for the sector.  

How to boost software export services?

As of now, Bangladesh has earned about $1 billion by exporting Information Technology Enabled Services (ITES) and software, of which about $350 million came from outsourcing and freelancers. The government can ensure quality internet services in rural areas to boost exports.

The sooner Hi-tech parks are established, the better the response will be from large global IT investors, which would enhance the country’s ICT industry. 

If there is investment in the sector, there will be more production which would increase export earnings from the sector.   

How to attract Foreign Direct Investment (FDI) in the ICT sector? 

In attracting investments from foreign companies, the government has to take steps to start operating at least three to four Hi-Tech parks as soon as possible. If that is done, we will be able to bring big companies here to invest.

To do so and to make Hi-tech parks popular, the government has offered incentives in the budget so that local firms are encouraged to start operations there.

In attracting employees to work at Hi-tech parks, the government should offer incentives to owners. This should be for at least the next five years.      

What should be the VAT rate for the sector? 

The Information Technology Sector (ICT) sector has to pay 15% Value added Tax (VAT). It is good  that the government is going to introduce several different VAT rates.   Since the ICT sector is an emerging sector, it is our earnest call to the government that the lowest VAT should be charged in this sector. 

What problems is the sector facing now which can be resolved in the budget?

We are very grateful to the government for offering tax exemptions till 2024. But there are problems regarding the certification for realizing the exemption. 

The government should introduce an HS (Harmonized System) code for the E-delivery of imported software received over the internet, as the customs authorities do not understand e-delivery and importers are being harassed.

Internet services should also be included in the items of ITES, without which business in the IT industry is not possible.