Bangladeshi businesses in the information technology (IT) sector are receiving an increasing volume of orders for software, data processing and IT-enabled services (ITES) from global clients, pushing the country’s ICT exports to great heights.
According to data from the Export Promotion Bureau (EPB), local IT companies saw export earnings go up by 52% year-on-year (YoY) to $369 million in the July-April period of FY2021-22, earning 35.59% more than the target set for the sector in that period.
The sector recorded $242 million worth of exports in the first 10 months of FY 2020-21, crossing the $300-million mark by the year-end as global demands for ICT services peaked due to the pandemic.
As per industry insiders, the demand for such services is still coming in although foreign countries have returned to normal economic activities.
“The demand for IT and ITES will rise further as companies across the globe continue to digitise and automate their business processes, providing Bangladesh the opportunity to widen its ICT basket,” Syed Almas Kabir, the former president of the Bangladesh Association of Software and Information Services (Basis) told Dhaka Tribune.
Omar Sharif, managing director of Bytetrek, a software and ITES exporter focused on the US market, said that their export earnings increased roughly by 55% in the last year thanks to growing demands for call center agents as well as software from clients in the Texas region.
The company provides software and ITES to 22 emergency rooms in Texas state and is currently trying to expand its businesses by acquiring European and Australian-based clients.
“All the top local IT companies performed well in the last fiscal year and they are expanding,” said Shariff, citing how his organization hired about twice the number of people just last year than it employed the year before that.
The higher export earnings in the first 10 months of the last fiscal were driven by the sales services, such as data processing, web hosting, consultancy, and product installation and maintenance.
Receipts from ITES exports, namely data processing and web hosting, grew by around 61% YoY in the July-April period to $277.9 million.
Similarly, IT consultancy services recorded earnings of $31 million in the first 10 months of fiscal 2021-22, up from $22 million a year ago, while software exports rose to $51 million from $42.6 million at the same time.
Export receipts for the installation, maintenance and repair of computers and peripheral equipment increased by around 86% during the July-April period of FY2021-2022 to $9 million.
However, as per Basis, export earnings from IT services are more than $1 billion, far higher than the EPB figures as government figures do not include the earnings of freelancers and service providers who bring their export proceeds through unofficial channels.
But, industry insiders said that the Russia-Ukraine war has adversely impacted the global economy with inflation rising across the globe, which includes some of the top export destinations of the country, slowing down the pace of growth.
However, Ukraine was one of the top IT and ITES providers prior to the ongoing war, and some of their orders are being diverted to Bangladesh.
Additionally, work orders are coming in from EU and US markets as IT firms in those markets are struggling to meet demands as job switching has intensified.
According to market players of the country, any declining trend of investments for businesses around the globe will have an impact on the local IT sector and the impact of the global economic uncertainty on the sector can be assessed further in the coming months.
