Existing infrastructure facilities passable to boost IT-sector,
attract investors
IT, a super highway to improve economy, create
employment - Part III :
Jaliya A. Wickramasekara
Identify all resources and infrastructure available in the country
and find a mechanism to organize them towards a single direction
according a proper game plan. This plan should able to drive the country
towards "IT for all by 2010" and we can use this as a slogan.
From two articles during last two consecutive weeks ( January 24th &
25th) were trying to inculcate the significance of improvements of the
IT sector in the country elaborating various interconnected information
from the countries' viewpoint.
Apt practical examples depicted extracting from the success story of
the next-door giant amalgamating with our resourceful learnt human
legacy and satisfactory basic infrastructure facilities left over, which
are apparently yet to utilize and needed to empower on par with
appropriate level.
Incubator Concept
In Sri Lanka there is a company in the BoC Merchant Tower, Colombo-03
where they are providing Cubicles with all necessary basic facilities to
run small-scale software based companies for a reasonable monthly rent.
Other than providing electricity, telephone, network and leased-line
facilities to use internet they provide common photocopy, conference
room, lunch room etc and organizing workshops to improve their knowledge
in various aspects.
Once your company becomes matured you can flyaway from them for
better prospects i.e. bigger place or your own building. This is like
your premature baby keeping inside the incubator in a hospital until the
baby gets matured. Further if you need money they will organize venture
capital funds through the foreign investors after evaluating your
strengths and the product developed by you.
Venture Capital Concept
The venture capital concept has been the main source of finance for
software industry around the world. This is a well-known concept
existing in vogue in the world and it could help small-scale companies
and the talented individuals or a team of experts to become giants other
than acquiring foreign currency.
However non-existence of a proper IT environment with a clear vision
of the country these companies can do very little hence again the
government should intervene broadly.
Encourage the Investors
The Software sector cannot be ignored, but we should educate the
local investors and they must try to understand the business. In the
past decade or so, the only industry, which has been consistently
growing, and that too at a fantastic rate, has been the software sector.
Any investor, who has not touched this sector before, will get scared
to invest their hard-earned money to new areas of business. In India lot
of non-IT companies had diversified their businesses to this industry
and subsequently able to reap the real harvest than their area of
traditional businesses therein.
Currently in Colombo we are having three giants in the IT industry
namely Vertusa, Millennium IT and IFS who are involving with exports of
their own software with the help of around 500 well qualified employees
(Engineers and other degree holders) per each company.
However government can encourage other non-IT but very well
established companies involved in the other trades (ie. garment) such as
MAS Holdings, Brandix Group to make them diversify in to this golden
industry.
Presently they are handling majority of workers who are having hands
on skills but with proper HR management mechanism, which is very vital
and different art altogether to get things done from human beings very
successfully.
These companies are having good skills to negotiate with foreign
buyers and work towards a given plan by the buyers within the target
time frame. This practice is very important for the IT sector as well.
We can use foreign investors who are having thrust to invest money
for profitable and growing businesses like IT and can use same to earn
foreign currency. Infrastructure
We should thank the present government for giving their commitment
through the budget 2007 to concentrate on developing the infrastructure
facilities as a basic but necessary foundation for the development of
the country.
If we consider the late President His Excellency Mr. R. Premadasa's
200-garment factory program, his idea was to bring the development from
town to the villages and producing job opportunities for the people in
the rural areas.
When we compare IT with the garment industry, Computers mean Sewing
Machines, raw materials such as clothes and other items mean human brain
(knowledge) and the data or information means finished goods.
If you setup a garment factory you should transport raw materials and
the finish goods from the port to the factory and vice versa via roads.
Then you should require a proper road network with less traffic.
In the case of IT, transportation of data or information means
transmit them via the high-speed telecommunication lines instead of
using the roads. If we consider the garment factory it is a very
important area of business to provide jobs for the people who are having
hands on skills with low profile of education (machine operators).
In the IT industry we can utilize the educated people and improve the
economy with high volume of income, which is very vital for economic
development of the country and to provide the jobs for educated people.
Without any doubt we should bring equal development opportunities to
all areas of the country since 52% of the GNP earned by the Western
Province whereas balance 48% is from all other provinces. Luckily
present government has understood this imbalance economic situation.
Especially the majority of the people who are in the southern
province are well educated but because of non-existence areas of proper
opportunities they have to migrate to Colombo and similar towns. But if
the government can start 'Special Economic Zones' (SEZ) for ICT based
industry we can do a clear change in terms of generating income and
jobs.
Software Technology Parks (STP)
In India there are special IT - industrial zones called 'Software
Technology Parks'. Government is providing lot of facilities such as
lands, basic infrastructure, tax exemptions, ...... etc, and more than
the benefits, that we provide for BOI companies in SL. India has
established more than 17 STPs successfully and more than 1,300 foreign
companies have registered in these parks.
In fact during the first visit made by the President to India it is
reported that he is interested in starting same in SL as well. We can
start such Parks in the selected provinces and districts such as Matara,
Galle, Kurunegala ...etc based on the population of educated people in
particular areas. According to the security situation of the country
these locations are even more peaceful and better to attract foreign
investors.
T'communication Sector
The telecommunication market in SL was monopolized by the State
before 1995. After the former President Her Excellency Mrs. Chandrika
Bandaranaike's decision to privatize this sector we were able to improve
same at a fantastic rate though we could not bring the desired results
through privatization from most of the other sectors.
Presently several foreign investors are planning to invest in this
sector. According to the Central Bank statistics every 18 persons had
phones against 1000 (ratio 1000:18) in year 1996 whereas it has
increased up to 165 in 2004. World-renowned companies such as Bell,
Suntel tied-up with several retailers in the country are selling
wireless phones in every corner of the country.
Mobile phone connection density will beat the fixed and wireless
phone density in the near future. Today phones are an essential and
reachable item relative to the past for most of the people in the
country.
However apparently the affordability of the telecom facility in SL is
low compared to other Asian countries. In other word though the tele-density
is increased to a great extent but most of the people cannot use this
facility other than for urgent circumstances because of the high
charges.
This situation will not favour for the development of the IT sector.
The SLT's ( Sri Lanka Telecom) role in this sector cannot be considered
as small and they are the leaders in the market since they maintain 77%
of the market share for fixed-lines.
Their domestic core network consists of optical Fiber rings capable
of handling gigantic volumes of data and SLT's international
connectivity is well positioned to transfer data at the speeds of
terabyte per second, which would facilitate any business.
After commissioning of Bharat Lanka optical fibre submarine cable
between India and Sri Lanka, customers of both countries would benefit
by competitive international Private Leased Circuits (IPLCs), Broadband
Internet, direct and backbone networks, transit International Direct
Dialing (IDD) traffic, Internet Protocol (IP) and multimedia content
services etc.
This cable could create substantial bandwidth and both companies can
inter-connect their IP based multi protocol label switching (IP-MPLS)
network to facilitate Global Virtual Private Network (VPN) services of
the valuable customers. Existence of infrastructure of this nature in SL
is very vital for IT business.
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