Low interests in high-tech parks

The government has set up eight technology parks across the country, aiming to create skilled manpower, facilitate businesses in the information technology sector and create employment opportunities.

However, apart from the one in Dhaka, the seven other parks established in different parts of the country remain in a dire strait even 5 years after the announcement of the plan.

The real situation of creating employment opportunities in these parks is nowhere near the government-set target.

About 60% of space in the parks outside Dhaka has remained unrented for a long time due to a dearth of entrepreneurs. On top of this, many of the entrepreneurs who rented space in some of these parks have had to shut down their businesses later.

Creation of skilled manpower is one of the main objectives behind setting up of these technology parks. But, entrepreneurs say a lack of skilled manpower is a major reason why entrepreneurs are not being able to start businesses or are being forced to close down after starting them.

Even though the country has a small number of manpower who can work in the general fields of the IT sector, it seriously lacks skilled manpower to work in the advanced fields of the sector.

These parks even lack all supposed high-tech facilities including high-speed Internet. There are various infrastructural deficiencies as well.

Entrepreneurs claim that space rents and other charges in these parks are much higher compared to private establishments at the district level.

Most of the IT sector businesses are Dhaka-centric, which is why doing business in these parks established in the districts is not profitable, according to leading businessmen in the sector.

Against such a backdrop, entrepreneurs are showing little interest in investing in the technology parks except for the Janata Tower Software Technology Park at Karwanbazar in the capital.

In 2015, the government's Digital Task Force meeting set a target to create 1 lakh jobs in the following three years by setting up technology parks in different parts of the country. But, only 7,500 people could have been employed in these technology parks in five years.

Hosne Ara Begum, managing director of the Bangladesh Hi-Tech Park Authority, thinks the employment generation target was not a realistic one considering the fact that creating skilled manpower in the IT sector is a time-consuming matter.

Employment target 1 lakh, achievement 7,500

The second meeting of the Digital Bangladesh Taskforce chaired by Prime Minister Sheikh Hasina in 2015 decided to create 1 lakh jobs in the following three years by setting up high-tech parks, software technology parks (STPs) and incubation centres in Dhaka and other parts of the country.

Five years on, only 7,500 people have been employed in these technology parks. Of them, 4,296 people have got jobs in Kaliakoir Hi-Tech Park which later set a target to create one lakh employment opportunities separately.

Asked about the reasons behind this deplorable state of employment, Hosne Ara Begum, managing director of the Bangladesh Hi-Tech Park Authority, said the mammoth employment generation target was set without conducting any survey.

"In the technology sector, there is no scope for creating employment opportunities overnight," she noted, adding that skilled and trained manpower is needed for this. And creating such manpower is a time-consuming matter, she continued.

The Hi-Tech Park Authority is working to improve the skills of young people across the country through training and incubation centers, she maintained.

She also expressed hope that the target of creating 1 lakh jobs will be attained by 2025.

59% of space remains unrented

Eight parks and incubation centres have been set up under the Hi-Tech Park Authority (BHTPA) since its establishment in 2010.

These are: Janata Tower in Dhaka, Bangabandhu Hi-tech Park in Kaliakair, Sheikh Hasina Software Technology Park in Jashore, Bangabandhu Sheikh Mujib hi-tech parks in Sylhet and Rajshahi, Software Technology Park in Chattogram, and Sheikh Kamal IT training and incubation centres in Barishal and Magura.

The high-tech park authority has developed some 13.15 lakh square feet (sqft) of space in these parks, but only 5.41 lakh square feet has been rented thus far – meaning about 59% of the total space remains empty.

In the last financial year (FY 0) alone, 3.60 lakh sq-ft of space was developed in the parks, while only 1.70 lakh square feet or 47% of the developed space could be rented out.

The authority has set a target to develop 2.8 lakh sq-ft of space in the current FY21. In the first three months of the fiscal, only 2,000 sqft were rented.

People concerned say a bulk of the developed space has remained unrented because of a dearth of entrepreneurs in the technology sector.

Entrepreneurs who rented space in some of the parks have had to close down their businesses due a lack of necessary facilities there, they added.

Hosne Ara Begum of the High-Tech Park Authority, however, refused the claim that a huge amount of space is left unrented in high-tech parks owing to a lack of entrepreneurs.

"We are getting a lot of applications seeking space allocation," she said, adding, "Many entrepreneurs from other industries are also filing applications fearing that space rentals could rise in the future."

She asserted that the authority is now proceeding cautiously in allocating space as many entrepreneurs could not start their businesses even after being allotted space.

Excessive rentals discourage entrepreneurs

Entrepreneurs say high rents of space have made them reluctant to invest in the technology parks.

"The rent for one sqft of space in Janata Tower Software Technology Park in the capital is Tk35, including service charge. But entrepreneurs have to pay Tk30-50 per sq-ft of space in Kaliakair, which is higher compared to the capital," they pointed out.

The rent of space in Jashore Technology Park is Tk14 per sq-ft, which is higher than the rent of other commercial spaces in the city. Similarly, the Tk11 per sq-ft rental in Sylhet high-tech set up at Companiganj of the district is much higher compared to the rents for other commercial spaces there.

Out of 1.45 lakh sq-ft space in Jashore Software Technology Park, 1.17 lakh sq-ft has been rented. On the other hand, the entire space of 162 acres of land in Sylhet is lying vacant, while only one of the 10 buildings in Rajshahi park has been rented so far.

An average of 27,000 sq-ft of space have been developed in Sheikh Kamal IT training and incubation centers in Barishal and Magura, but the entire area remains empty due to no entrepreneurs. Some 1.20 lakh sq-ft of space is lying vacant in the Chattogram Software Technology Park.

Hosne Ara Begum refused to accept the claim that the rent is high. She said space rent in high-tech parks has been determined after comparing the price of land, development cost and the rent of private buildings in the area concerned.

Lack of infrastructure, skilled manpower

Entrepreneurs complain that the parks charge high space rent while most of them do not have the necessary high-tech infrastructures.

They said high speed internet is one of their major concerns. Many parks even do not have banking facilities. Entry and exit fees, space rent and other service charges have to be transacted manually.

According to the entrepreneurs, the major issue at the parks is skilled manpower. They said the crisis is limitless in advanced sectors such as software development, gaming, internet of things (IoT), machine learning, big data processing, cloud computing, artificial intelligence and blockchain technology.

Few companies who run businesses in the parks outside Dhaka are mostly involved in simple tasks such as search engine optimization, website design, social media marketing and digital marketing. 

A representative govt report

Sheikh Hasina Software and Technology Park in Jashore offers a representative picture of the other high-tech parks across the country.

A report of the Implementation Monitoring and Evaluation Division (IMED) under the Planning Ministry says a Japanese and a local companies have wrapped up their businesses in the business park owing to issues such as a lack of world class infrastructure and skilled manpower, lack of banking system, high space rent and mounting pressure of utility bills.

The IMED report says the remaining companies are struggling with due utility bills and burgeoning losses.   

Analysing reports of the company located in the park, IMED says local firms could not compete internationally due to a lack of skilled manpower. Businesses in the park somehow survive on low-priced jobs left by the Indian, Malaysian, Chinese, Japanese and European companies.

Only five companies in the park can perform software development while others do general works such as search engine optimisation, social media marketing, website design and e-commerce.

The park was said to generate 5,000 jobs, but it has employed only 700 people so far.

Experts skeptical about success

Fahim Mashroor, former president of the Bangladesh Association of Software and Information Services (Basis) and CEO of Bdjobs.com, said most IT companies in the country are small, employing 10 to 50 people.

Such firms can run at rented flats only, he said, adding that they will not be willing to go outside Dhaka.

"The IT companies are Dhaka-centric. For them, it is easier to sell products and services from the capital than shifting to the parks even if they are provided with free lands there."    

Mashroor said these are the reasons the technology parks are not much of a help.

However, Syed Almas Kabir, the incumbent president of Basis, is quite optimistic about the parks.

He told The Business Standard that the parks are playing a role in creating new entrepreneurs and generating employment.

He said everything in Bangladesh is still Dhaka-centric. Previously, there was no infrastructure to take the business out of the capital, but the infrastructure is being built now.