Why our ICT exports fall far short of $5b target

Amid multiple challenges and structural limitations, Bangladesh’s information and communication technology (ICT) sector is struggling to increase export earnings at the desired pace as there is significant potential for this industry. Shortages of skilled manpower, global competition, policy complexities, infrastructure constraints, and difficulties in keeping pace with technological changes may continue to hamper the sector’s export growth in the coming days.

According to data from the Export Promotion Bureau (EPB), Bangladesh earned $724.6 million from telecommunications, computer and information services in FY2024-25. The figure is significantly below the government’s target of $5 billion in ICT exports by 2025, meaning only 14.5 percent of the target was achieved. 

The gap is particularly concerning as regional competitors are expanding their technology exports rapidly, making it increasingly important for Bangladesh to change its strategy and focus on higher-value services.

Investment shortage remains a major obstacle despite the sector’s potential. Technology-based startups and ventures generally involve higher risks and longer periods before returns, discouraging large institutional investors. Limited risk-management capacity in the technology sector also makes it difficult to attract institutional funds.

A shortage of skilled professionals is another major challenge. Bangladesh lacks adequate numbers of workers with skills aligned with global demand, particularly in artificial intelligence (AI) and other emerging technologies. At the same time, gaps between academic curricula and industry requirements mean that fresh graduates often need additional training before becoming suitable for high-tech jobs.

Policy and bureaucratic complications further constrain the sector. Although the government has introduced various policies, implementation remains inadequate in several areas. Legal and administrative complications surrounding cross-border transactions also create barriers to foreign investment and the operations of multinational companies.

EPB data shows that Bangladesh’s exports of telecommunications, computer and information services stood at $436.66 million in FY2020-21. They surged to $738.79 million in FY2021-22 before falling to $664.49 million in FY2022-23 amid global economic uncertainty, slower investment in the technology sector and changing international demand.

The sector subsequently recovered, with exports reaching $672.64 million in FY2023-24 and $724.6 million in FY2024-25, representing annual growth of around 7.7 percent. However, the latest figure is still below the record $738.79 million earned in FY2021-22.

Computer services remain the mainstay of Bangladesh’s ICT exports, covering software development, IT outsourcing, data processing, hosting, consultancy and maintenance.

However, much of the growth still depends on relatively low-value-added activities such as outsourcing, data processing, basic software development and graphic design. As a result, export earnings are rising without a corresponding increase in revenue per worker and overall value addition.

Syed Almas Kabir, former president of the Bangladesh Association of Software and Information Services (BASIS) told the Daily Observer, “The fundamental problem is the changing nature of work and lack of skills. In the past, we used to undertake various types of outsourcing and entry-level jobs for international clients. Many of those jobs have now become automated. As a result, foreign clients are no longer outsourcing those tasks to countries like Bangladesh.

The real challenge is that our freelancers and IT companies have not upgraded their skills in line with the changing global market. As a result, we are not getting decision-making or critical, high-value assignments. These jobs are increasingly moving to countries such as Vietnam, the Philippines and Cambodia.”