The Bangladesh Association of Software and Information Services, which started its journey

with 17 companies in 1997, now stands at 1,200 plus companies involved in software
development and providing IT services. Bangladeshi IT and IT-enabled services (ITeS) firms
generate almost 35 percent of its export revenue from the US, 15 percent from the UK, followed
by several EU countries such as Denmark and the Netherlands. In Bangladesh, there are more
than 100 software houses, 35 data entry centres, thousands of formal and informal IT training
centres and numerous computer workshops. Plus, the Bangladesh Hi-Tech Park Authority was
formed with the vision to ensure sustainable development and proliferation of IT or Hi-Tech
Industry in the country. Given the potential of the ICT sector in Bangladesh, it can work as a
major economic driver. Covid-19 possesses a unique challenge for the IT industry of Bangladesh
as it is only in growth stage now. Industry insiders expect the overall revenue for the 2020 year
to fall by 20-25 percent due to the pandemic. However, the industry players that mainly focus on
outsourcing of software development are at a disadvantage. India, for example, serves 16 percent
of the global market and is already predicting a lower growth rate than the previously estimated
7.5 percent for this year, says the Indian IT industry body Nasscom.
With the challenges now apparent for the IT and digital sector, the government must pay
significant attention to its third-engine in a post-coronavirus Bangladesh. Bangladesh can
improve in the following fields to encourage foreign investors:
1. On a B2C level, e-service companies such as food delivery and ridesharing ones need to
create a safe and hygienic environment in their operations by ensuring that all the
delivery men, riders and drivers take safety precautions seriously.
2. On a B2B level, tech companies need to support their staff by providing proper work
from home initiatives and creating accountability through better management and
delivery techniques.
3. The companies also need to reassure their clients that the work from home will not
impact business significantly and precautionary measures are being taken to ensure
business continuity.
4. Bangladesh's Gross Domestic Product (GDP), growth in the fiscal year 2019-2020 is
likely to plunge. So, it must be plunged in the coming fiscal year 2020-2021.
5. Japan, the US and Europe have announced they will relocate their factories from China to
reduce their dependence on a single country. Japan has already allocated $2.2 billion to
help its manufacturers shift production units out of China. Korean companies are also
planning to move out of China. So the process to shift production of a part from one plant
to another should be made easy for them. We will have to allocate lands and earmark the
land for business.
6. However, Vietnam and India have started talking to many Japanese and US firms that
want to move out of China. The Indian government, in April, reached out to more than
1,000 US companies and reportedly offered them incentives to move to India from China.
Bangladesh also try to send words to them and propose a profitable business in our
country.
7. Bureaucracy must change its entire mindset in a bid to facilitate businesses instead of just
regulate them.
8. A dedicated zone to host Japanese investors is being constructed. This can be an
opportune moment for us. We need to design some exclusive incentives packages for
Japanese 100% export-oriented investors.
9. Bangladesh needs to extending tax waiver, allowing duty-free import of machinery –
even used, providing bond facilities, and speeding up services
10. Beza proposed a tax holiday of seven years for industries that invest a minimum $100
million and the facility could be extended to 10 years for a $200 million investment.
11. India has earmarked lands, equivalent to two Luxemburg, for foreign companies intended
to shift factories out of China. Last month India reached out to more than 1,000
companies, including medical devices giant Abbott Laboratories, in the US and through
overseas missions to offer incentives for manufacturers seeking to move out of China.
India has also targeted some US and Japanese companies which are engaged in medical
equipment, food processing, textiles, leather and auto parts. India has also moved to
reform land, labour and taxes in a bid to lure foreign companies. The country's trade
ministry has sought detailed feedback from US companies on changes needed to make
the country's tax and labour laws more favorable to companies.
12. Vietnam, which is already known as China plus one manufacturing, is in the top of the
list of factory relocation from China. The country's proximity to China and presence of
global companies has made it a big choice for the probable relocation of factories from
China. Also, Vietnam's success in containing Covid-19 is one of the best in the world and
it has helped them earn the trust of foreign investors. Yet, the country is doing everything
- from offering space to incentives and tax cuts – to bring foreign companies in Vietnam.
Nguyễn Đình Cung, member of the Prime Minister's Economic Advisory Group, recently
said the government would set up a special working group to negotiate directly with
foreign groups to move investment to Vietnam after the pandemic. The working group
would help local and foreign companies know each other's demands. Vietnam has also
planned to simplify administrative procedures, including investment and business
procedures, to attract high quality foreign investment.