Budget to take IT Sector to Next Level | Daily News

Budget to take IT Sector to Next Level

- State Minister of Technology Kanaka Herath


Q: Are there budget proposals to develop the IT sector in the country?

A: I would say that here we are talking about three main pillars. They are export-oriented competitive economy, environmentally friendly green and blue economy, and digital economy. Out of these, the digital economy is very important. We all know about the QR code. In the crisis it helped a lot because we all know about the queues we had all over the country. So there are so many other proposals as well. Right now we are trying to introduce a transport card, where you can use the card for bus or train service.

We are trying to implement this with the Transport Ministry. So right now our technical experts are working on this and we are going to give the proposal to the Transport Ministry. There is something else called the Digital Signature. It was approved by Parliament but still nobody uses it. For the banking sector as well as the Government sector this will be very important. Then there is the electronic payment system. By 2024, all the payments will be electronic payments in the Government sector.


Q: Is there a Budget Proposal to take the IT sector into next generation like in India?

A: I read most of the proposals, and I can tell you that we have been allocated 11.5 billion rupees for 2023. That is for the whole ministry. When you compare Sri Lanka with India, we are far behind. But we are trying to be in line with Asian technology.


Q: You are the State Minister of Technology. What is the Sri Lankan IT industry’s goal for the year 2023?

A: We are trying to get the data protection authority activated. Because this year the Data Protection Act was approved by Parliament. I think that was the first Act in South Asia. Apart from that there are so many projects. But the main project that we are having next year is the Unique Digital ID (UDI). It is funded by India. We are getting about 13.5 billion rupees from the Indian Government. So UDI is a digital ID. It can be used to get your passport and it can be used to get your driving license. From anywhere in the country you can get a birth certificate or even the passport. So the UDI is the most important project we are going to be involved in for next year. As I mentioned before, we have the transportation card project, and then we have the driver’s license demerit point system, which will be implemented next year. Anyone can be spot-fined and the points can be demerited.


Q: What are the challenges faced in the IT sector?

A: When you compare the IT sector with the other sectors for the last two or three years, the IT sector has contributed heavily to the Sri Lankan economy. Last year the contribution was 1.7 billion US dollars into the Sri Lankan economy.

We have around 175,000 IT professionals in our country. So because of this crisis and because of the taxation, most of our professionals are going out of the country. Either they go out of the country or else they join international companies in Sri Lanka. That is the biggest challenge we have right now. The IT professionals are leaving and because of that our local IT industry might go down. Our target is to get around 3 billion US dollars in 2024. So to reach that target, there is a big issue because of this taxation. We have had discussions with the Ministry of Finance and the Central Bank as well to give some incentives to the IT sector. Hopefully by next year, if we give some incentives we will be able to survive. That is the main challenge.


Q: The IT industry in the world is rapidly developing and Sri Lanka has to compete with the rest of the world. What is your ministry doing to improve the IT education in the country?

A: The graduates who are in their second year, are being recruited by all the IT companies in Sri Lanka. The degree level holders or the undergraduates are being employed. So there is a big vacuum. We have had some discussions with the Education Ministry and the Finance Ministry as well. Early next week we are going to have some discussion with the UGC as well. From all the graduates, about 50% are Arts graduates.

We are trying to introduce IT where you can be employed by the IT sector. We are trying to partner with all the universities which have Arts degrees and introduce subjects which are relevant to the IT job market. That is what we are trying to do. Even the Minister of Education mentioned this some weeks ago, that we are going to introduce AI into our education curriculum. From O/Ls itself we need to educate the children about the IT sector and show them that there are opportunities for their future. Apart from that there are those who have not qualified to get into universities even though they have passed their A/Ls. They do not have enough marks to get into university because the university admission is so competitive. There are about 70% youth. So we are planning on getting them into the IT sector as technicians or other workers, while giving them training through all the vocational training institutes. It is important to affiliate them to the industrial sector. If you go with them, I think the job will be guaranteed. Right now there are so many IT courses in vocational training. But there is no guaranteed job opportunity for them. By combining these two together, I think in future there will be jobs for youth as well.


Q: What kind of potential does Sri Lanka have when it comes to IT Parks? Because I know that Sri Lanka has a few Government owned and privately managed IT Parks?

A: The main objective of having IT Parks is for the IT professionals to expand their export industry, for innovation, and to create more job opportunities for IT sector professionals. It is a good opportunity for the IT sector. But right now it is in a problematic stage because of the present crisis. I think there will be more investments next year.


Q: What are the shortcomings when it comes to Sri Lanka’s IT industry? Also what are the opportunities available in the Sri Lankan IT industry?

A: The main issue that I mentioned before is the brain drain. We have to address that issue. There will be challenges for the local IT companies and there will be challenges for the international IT companies as well. Because most of the professionals are leaving the country because of taxation. I hope there will be a change. The taxation system might be changed. As I mentioned before there are so many opportunities in the IT industry for professionals and technicians. From the school itself we have to focus on training these students for the industry.


Q: In order to compete with the rest of the world, what mechanisms should we put in place when it comes to the IT sector in Sri Lanka?

A: We are not in line with the technology out there in the world. We have to do the digital transformation as soon as possible. For that we are trying to implement so many projects. One of the main projects as I mentioned earlier is the UDI. If we implement that, all the Government sector services can be provided to any citizen of the country in any location.


Q: What is your ministry’s vision when it comes to technology in Sri Lanka?

A: Our vision is to provide e–government services to all the citizens within a short period.

Q: How do you intend on attracting foreign investors?

A: One is the IT technology parks. That is one thing we are focusing on for investors. Where you have all the facilities in one centre; where all the professionals can work together; where innovation can happen. However, there are problems at the moment. First we have to give incentives for foreign investors. Right now we are not in a situation to provide that for the local sector or for the foreign companies. But hopefully in the future, when things settle down and we come out of the crisis, we will be able to give incentives for the foreign investors.


Q: How much foreign income do we earn annually?

A: Last year it was 1.7 billion US dollars. We are targeting 3 billion US dollars in 2024. If we can safeguard these international and local companies, we can go to that target in 2024.


Q: How many are engaged in the IT Sector?

A: There are 175,000 professionals. And apart from that, IT literacy has come up to 52%. That is also a big achievement for the past three to four years. But by 2024 we need to raise it at least to 60% - 70%.


Q: What is our position in Asia when compared to other countries in the region?

A: We are actually behind. Singapore and Korea are leaders in technology. It is not only in Asia but in the whole world. We are somewhat behind. I think we can achieve our targets if our economy settles down. I am talking about industry 4.0. If you look at history and take industry 1.0. we were in line with the world, probably because we were colonized. And then we were somewhat in line with industry 2.0. But when it comes to industry 3.0. we were really behind. So that is one issue. Right now our challenge is, if we are planning to go to industry 4.0. we have to look at AI in all the industries. That is very important.


Q: Is there anything else you wish to say?

A: The vision is to have green energy by 2030. The President wants us to look into green hydrogen energy. So we are looking into these studies. It will be a new thing and also in the next year, we are looking at high intake agriculture. In most of the private sector they have started automation. But we are looking at the Government sector as well.



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