Information technology (IT) exports from Bangladesh are snowballing as global clients have swamped local IT companies with orders for various software, data processing, and other digital service solutions.
As such, local IT companies saw their export earnings shoot up 52 percent year-on-year to $369 million in the July-April period of fiscal 2021-2022, according to the Export Promotion Bureau (EPB).
The industry raked in $242 million from exports in the first 10 months of fiscal 2020-21 before going on to cross the $300-million mark by the end of the year as Covid-19 turbocharged global demand.
And even though the pandemic situation has since improved, orders continue to flow in from abroad due to the return of economic activities worldwide, industry people said.
The industry raked in $242 million from exports in the first ten months of fiscal 2020-21 and may cross the $300-million mark in entire year
Syed Almas Kabir, former president of the Bangladesh Association of Software and Information Services (BASIS), said the demand for IT and information technology-enabled services (ITES) will rise further thanks to the continued digitization and automation of all companies across the globe.
“So, Bangladesh has plenty of opportunities to widen its basket in this sector,” he added.
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 percent year-on-year in the July-April period to $277.9 million.
Similarly, IT consultancy services raked in $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.
Ferdous Ahmad Shaon, managing director of Cefalo Bangladesh, a software exporter focused on the European market, said their export earnings swelled by up to 50 percent in the last year thanks to growing orders for both financial technology (fintech) and non-fintech products.
The company’s blockchain-based fintech app has become popular abroad with clients from four counties already having acquired it.
“All the top local IT companies fared well in the last fiscal and they are expanding,” said Shaon, citing how Cefalo hired about 70 people in the last one year, taking its total manpower close to 200.
Shaon then said the Russia-Ukraine war has created a difficult situation in the global economy with inflation soaring around the world, including Bangladesh’s top export destination for IT in the West.
“The impact of the global economic uncertainty will be clear after a few months,” he said.
“If businesses around the world cut down their investments, it will harm the IT sector and Bangladesh will not be immune from that crisis,” Shaon added.
The export earnings of Brain Station 23, one of the top software exporters in Bangladesh that employs 600 local tech talents, grew by 40 per cent during the July-April period of 2021-2022.
“But, the pace of growth slowed due to the war,” said Raisul Kabir, chief executive officer of Brain Station 23.
However, Ukraine was a top IT and ITES provider before the war, which diverted some of their orders to Bangladesh.
“At the same time, some orders were declined for the gloomy global economic situation caused by the war,” he added.
Intiaz Ilahi, chief executive officer of Graphic People, a web developer, said job switching has intensified in the EU and US markets following the pandemic and so, IT firms in those countries are struggling to meet demand amid the current situation.
“So, work orders from those counties have increased,” said Ilahi, adding that Graphic People’s growth in export earnings is over 15 per cent and it now employs a total of 260 people.
He went on to say the industry is now more diverse and the demand from global clients is rising.
Export receipts for the installation, maintenance and repair of computers and peripheral equipment increased by around 86 per cent during the July-April period of fiscal 2021-2022 to $9 million.
According to BASIS, export earnings from IT services are more than $1 billion, which is far higher than the EPB figures.
Officials of the top ICT trade body said this is because government figures do not properly include the earnings of freelancers and how many service providers bring their export proceeds through unofficial channels.
