Software industry
This has been a relatively a late entrant in our ICT market. Even today there are only a few firms that provide dedicated software services and even fewer that have adopted any form of quality standards. However like any learning curve, more and more firms are coming into this fray; systematic procedures and practices are being implemented so that quality software houses are being produced.

The basic clientele for the software houses has usually been the corporate houses .i.e. the institutional market. That being so it naturally follows that most of the software are database related.

While few years back, visual basic was the predominant choice for programmers of late there has been a gradual shift to use other tools to provide better service to the customer. Furthermore with the passage of time firms have also realized the importance and benefits of installing an ICT system in a company. The fact that computer penetration is high in the metropolitan cities has helped in the sense that computer literacy among personnel has increased. Hence they are more likely than ever before to adopt a new computer software system.

It is true that the growth of the ICT sector is being hampered by the lack of proper telecommunication infrastructure. Bangladeshi companies continue to make the best out of what is being given to them. With the infrastructure situation improving, the software market is bound to increase.

One of the prime indicator or growth factor for the software industry is technical people. Similarly in order to retain and groom these technical personnel these firms need to earn on an increasing scale. To date that has been proved to be quite difficult. However in recent times, with the growth of the ICT training sector, availability of skill people has been enhanced. Also more and more software business houses are soliciting order from outside. Hence it is expected that within a decade software will form a predominant part of our economy.



IT Enable Services (ITES)
This is perhaps the newest segment in the ICT sector of our country. Medical transcription, GIS services, data warehousing and mining are still very new to our economy. Although there are firms who have entered this arena they are still very much in the infancy stage. Interestingly enough all the ingredients required to operate in this industry are already present in the country. It is up to association like BCS to increase this awareness among potential investors as well as existing ICT houses of the considerably potentiality in the ICT enabled sector. Furthermore our country owing to the convenient time difference with US enjoys a convenient time gap, which can be exploited if marketed properly.


Current Status of Software and ITES Industry in Bangladesh
Bangladesh has identified ICT as a "thrust sector" as it represents potential for successful reforms, job creation, industry growth and high spillover effects to other sectors as well as improving governance and facilitating inclusion. The current World Bank's Country Assistance Strategy for Bangladesh also recognizes the key role of ICT in supporting Bangladesh’s growth, competitiveness and governance agenda. The Information Technology (IT) Services, and IT-Enabled Services industry presents an attractive segment worth USD 475 billion that countries are competing for.


The ICT industry in Bangladesh, especially software and ITES industries, is relatively small compared to the size of its national population (150 million plus), and the size of the national economy. However, the software and ITES industries in this country have started rapidly growing in recent years. The average yearly growth rate of these industries here has been over 40 per cent for recent five years, and this growth rate is expected to continue. This optimistic growth is supported by good software export trends and large demand for IT automation in domestic market. Recently in Bangladesh, large-scale automation projects have been widely implemented in the sectors of telecom, banking, finance, pharmaceutical, and garment/textile industries. Domestic demand for software and ITES industries is expected to increase more.

As of now, there are close to 500 software and ITES companies are registered in Bangladesh. These companies employ over 12,000 local ICT professionals. The size of the ICT market excluding telecom in Bangladesh is estimated to be US$ 300 million in total; the software and ITES industries share 39 per cent (US$117 million) of the market. More than 100 companies export their products to over 30 countries. The major export market is North America, but recently many IT companies started export to EU countries and East Asian countries, especially to Japan. At least 30 companies, among 100 companies that export their products, are established through joint-venture with an overseas company or as an offshore development center (ODC) by one-hundred-percent foreign capital


Bangladesh has high potential to become a huge source of skilled human resources with its cultural adoption capability, English language skills, analytical capability and large number of educated and energetic youths with bright aptitude, quality and natural ability in software development.

To ensure quality and process control in a competitive global market, several software companies are following international standards such as ISO and CMMi. To meet the high quality standard of offshore jobs and comply with the expectation of overseas clients, the companies in Bangladesh are rightly focusing on embracing global standard practices and processes. Over twenty companies have already obtained ISO certification and a number of companies are in the process of acquiring CMMi certification.

Language of instruction in engineering, computer science and business studies at undergraduate and graduate levels is English, providing the country with a competitive edge for outsourcing software projects. Recently European Union has ranked Bangladesh as one of the top 20 outsourcing destinations in the world.


Export of Software and ITES from Bangladesh
Out of more than 500 Software and ITES companies in Bangladesh, more than 100 companies export their products to over 30 countries. ITES export of Bangladesh has been rapidly increasing. The major export market is North America, but recently many IT companies started export to EU countries and East Asian countries, especially to Japan. At least 30 companies, among 100 companies that export their products, are established through joint venture with overseas companies or as Offshore Development Centre’s (ODC) by 100 percent foreign capital investment. Most of these companies started their operations within the last two or three years, indicating that the Bangladesh software and ITES industries have started to be focused by the overseas venture capitalists.

In recent years Bangladesh earned a rapid growth in ICT export - which shows a rapid increase tend in ICT export. For instance:

Table 1: Value of Export of Software and ITES from Bangladesh (Unit: Million US dollars)

Fiscal year Value of export Growth rate
(compared to previous year)
2002-03 4.20 50.0 %
2003-04 1.19 71.2 %
2004-05 12.68 76.4%
2005-06 27.01 113.0 %
2006-07 26.08 (-3.4) %
2007-08 24.82 35.9 %
2008-09 32.91 32.59%
2009-10 35.36 7.44%
20010-11 45.31 28.24%
                                           Source: Bangladesh Bank

Networking
Under this category lies all networking related service providers as in Satellite communication providers, ISPs, WAN and LAN providers etc. Bangladesh got a taste of online Internet only recently (1996). However from that time on and also due to some pragmatic Government Decisions the number of internet users has increase substantially over the years. At its present rate it is expected that by the end of this year about a million of people will have access to Internet. By now the country has been connected through the submarine cable connections- this also triggered an increase in nation wide connectivity at the same time it has bring down the internet related costs.

An offshoot under this sector would be the dotcom industry. Current regulations set up in Bangladesh are conducive enough for a good growth in E-commerce which is playing a significant role in the global economy. However recent developments have suggested that Government needs to revise & update the law provisions to promote cyber use. It is expected that with the enactment of these laws the number of Dotcoms would increase considerably. Also e-commerce a new facet, would be flourish and thereby injecting more dynamism into the economy & commerce.

Bangladesh: A low cost Outsourcing Destination:

Bangladesh has high potential to become a huge source of skilled human resources with its natural ability of cultural adoption, English language skills, analytical capability and large number of educated and energetic youths with bright aptitude, quality and building algorithms, creativity and logical ability in software development.


Though majority of the companies are exporting to North American Market (principally, USA) - there is encouraging performance by a good number of companies to export in European and East Asian (mainly Japanese) markets too. To ensure quality and process control in a competitive global market, several software companies are following international standards such as ISO and CMMi. To meet the high quality standard of offshore jobs and comply with the expectation of overseas clients, the companies in Bangladesh are rightly focusing on embracing global standard practices and processes. More than 20 companies have already obtained ISO certification, and a number of companies are in the process of acquiring CMMi certification. At the end of 2010, at least ten companies will be reaching CMMi Level 3. Language of instruction in engineering, computer science and business studies at undergraduate and graduate levels is English, providing the country with a competitive edge for outsourcing software & ITES projects. This is the most deciding factor that the European Union has ranked Bangladesh as one of the top 20 outsourcing destinations in the world.

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