The Government considers the ICT industry as an integral part of the economy. It has emphasised its importance by including it in the National Export Strategy which was launched recently.
It plans to develop the sector by addressing the issues, challenges and constraints that hamper the progress of the industry. As a government body supporting the ICT industry, the Information Communication Technology Agency (ICTA) works towards the betterment of the sector facilitating its growth, Chairman, ICTA, Prof. Rohan Samarajiva said.
However, there is a dearth of IT professionals in the country and we need to produce more to meet future demand. For this, the industry needs to move outside Colombo and set up companies in cities such as Jaffna, he said.
“We are targeting US $ 5 billion export revenue by 2022 as this industry has a high net value addition. The industry prospects looks bright and we need to address the skill gap to gain the maximum advantage of the global demand,” he said at an interview with Business Observer.
Excerpts from the interview:
Q. From the current reports, we see a major focus on the ICT industry. Can you elaborate on this?
A. The Information Communication Technology (ICT) industry has drawn heightened interest from the policy makers due to the growing importance of the sector as a driver of economic growth.
The ICT is a necessary tool to improve the country’s performance especially with regard to exports. The Government recently introduced the National Export Strategy (NES), a policy document targeting six priority sectors of the economy to ensure fast track development. ICT is one of the key areas of focus.
As a government body, the Information Communication Technology Agency (ICTA) has been working towards the betterment of the industry since 2001 onwards.
It has given serious thought to the business processing aspect to generate business in the industry. We are not the only player that supports the industry as the Export Development Board and the Ministry of Development Strategy and International Trade also contribute towards the growth of the sector by providing most of the resources and strategies.
We play the supporting role. We are working on the specialised areas and contribute towards enhancing ICT export earnings. As ICT exports record net value addition, the country needs to look at more IT and IT enabled services exports as high net value addition could be made through these services.
With the NES in place, a growth could be seen in the rate of IT and IT enabled services in the future. This growth could be accelerated further with the support of the public private partnership.
Q. What is the current progress of the industry and the export target for 2018?
A. The target export earnings for 2022 is US $ 5 billion. The export value at present is US $ 1.2 billion. Given the organic growth of the industry the earnings could go up to US $ 3 billion in 2020 with the possibility of reaching US $ 5 billion mark by 2022.The private sector does all the services. We provide the regulatory framework to facilitate smooth operation of businesses.
Q. How do Sri Lanka’s IT industry professionals benefit from the global demand?
A. The global market is laying off people from low end marketing. We need to keep an eye on what goes on in the world. We came to the industry much later than the giant global players. Our entry to the industry was in 2002 to 2004.
We use accountancy services and knowledge processing outsourcing. The industry at present is moving from services to products where the value addition is high. We are not looking at just jobs, but especially the well paid jobs which move up in the value chain.
Q. What are the employment opportunities the young graduates have in the ICT field?
A. There is a shortage of skilled IT professionals in the country. There is an under-supply. However, due to mis-match in the skill requirement and the demand there are a lot of opportunities for the qualified youth. We need good computer science programs where these will provide more jobs for the youth.
There is also a mis-match in training given for the jobs in the IT field. We are conducting a workforce survey at present where the results will be released at the end of the year. This will give an indication of the jobs available in the market.
It will provide reliable and accurate information on demand and skill required in the IT sector. There is also a demand for good teaching mechanisms for students.
Q. How do you look at the next revolution (if any) within the ICT industry?
A. The next revolution within the IT industry is already happening. The next revolution is artificial intelligence (AI) and Internet of Things (IOT) which is from machine taking to machine. This is analytics engineering. The AL is software based decision making such as to whom to sell or who to treat.
The process is performed by software. This is highly controversial. AL is already here and how we adapt is the question.
We need to see how Sri Lanka could participate in this revolution. We need to have a set of training data.
We need to have a very good policy as to what training data need data protection. We are currently working on health data protecting. We will move on to general data protection by 2019.
Q. What are the other facilities we should develop to better gain from the industry?
A. A lot of good things are happening in Colombo. A 1,000 seat hatch is coming up. We need to take these initiatives outside Colombo. We focus our attention on Jaffna.
However, the lack of IT companies to train the young graduates is a huge drawback in this regard. They have to come to Colombo for internship and in most instances they remain in Colombo and do not return to Jaffna. Then the development initiative will not work in Jaffna due to dearth of qualified personnel. We need to have good IT companies in Jaffna. This is similar to the egg and chicken story.
We have set up the first outsourcing centre along the Parliament Road. However, the transportation from Colombo to the site is difficult as it takes a lot of time to travel especially from the airport.
Therefore, we need to find a solution for this. In order to develop these types of facilities we need to have quick access to the site from airport. Facilitating air travel may be the answer to this problem.
Q. What are the new areas we could look at when serving the foreign companies in the ICT industry?
A. Most of the big foreign companies are here doing business such as the London Stock Exchange and Pearsons. We need not treat them differently.
Q. How are IT based entrepreneurs doing in Sri Lanka?
A. Sri Lanka provides IT end products and back office services. It is in every thing. Senzmate which originated in the Kilinochchi campus is about precision agriculture methods to increase the productivity.
This is working in a particular domain in agriculture. Beyond doing conventional IT services our entrepreneurs are doing well in the IT sector.
Q. How should the industry develop the e-commerce sector in the country? What steps should we take?
A. The e-commerce sector is developing slowly. This is because there is the payment issue. Not everybody has credit cards. The mobile payment platform is the ideal choice.
However, there is a limit on payment. The ICTA has brought this issue up and in conversation with the authorities. The e-commerce involves not only Sri Lankan buyers, but foreign buyers as well. There is a question of payment.
The Paypal system also has an issue. The Central Bank is the critical player here. It is trying to look at working out a solution to help this industry move forward. As the payment is the main issue in the e-commerce platform there needs to be an efficient postal and delivery system to deliver the products to the customers. For that, the country needs to have an efficient delivery system.
Q. What are the future plans of the ICT sector? Get more foreign jobs and exchange?
A. ICT is in every part of the economy. The support of the ITC industry for the other industries such as tea, banking and apparel to be more competitive.
We represent part of every industry. As the Government is planning to launch digital economic strategies soon it is expected to simplify the processes. Currently, the sector has provided 80,000 jobs to IT personnel.
Q. Are the industry negotiating with global giants of the ICT sector to set up facilities in Sri Lanka?
A. Sri Lanka has already attracted global giants in the calibre of Pearsons. It is a major company. The Government did not do anything substantial to attract them.
The other example is the HSBC. However, a lot of effort was put in to get them and they generate good business. The Board of Investment is in charge of attracting FDIs.
We, as the ICT industry have difficulty in providing big numbers in IT professionals. Therefore, it is difficult to attract more IT companies. There are gaps in other skills.
We need to try and fix these problems. It highlights the need to develop the ICT industry. The foreign companies will be treated fairly while creating more and more export opportunities for our companies.
The ICTA will be acting as a matchmaker going beyond its services. We are doing this for the first time for the benefit of the local ICT industry.