The Financial Express

Closing digital divide towards a robust economic growth

| Updated: May 26, 2021 22:08:22

Closing digital divide towards a robust economic growth

Information and Communication Technology (ICT) has the power to help the nation to meet the challenges in today's global market. It is critical for the people of the country to change their attitude towards the development of ICT to increase the economy's growth. For a while now, Bangladesh has been trying to become an ICT-driven nation and has adopted numerous technologies to address multiple issues - hunger, malnutrition, illiteracy, discrimination, and many more. 

However, according to a study by ActionAid Bangladesh in 2020, only 50 per cent of the households in urban areas have internet access whereas, less than 30 per cent of homes in rural areas have it. The issue of ICT reaching a minority population is not limited to Bangladesh only, but it is also a problem for the world. As of January 2021, only 59.5 per cent of the global population has internet access.   It is creating a digital divide globally, including Bangladesh, especially during the Covid-19 pandemic. The term 'digital divide' refers to a gap between people who have access to ICT and those who do not have access or are restricted to it. The gap is harmful to any economy as it prevents societies from utilising the full benefits of ICT.

Currently, the gap is already harming the nation. For example, children without internet access are bearing the burden of the digital divide during the era of distance learning. It is jeopardising their education and future, besides creating inequalities. The gap is also stopping numerous people from taking advantage of ICT opportunities like freelancing or SMEs (small and medium enterprises).

SMEs play a vital role in contributing to the growth of the economy. The pandemic took a severe hit on the employment sector of the world, including Bangladesh. Not only that, the crisis has also impacted the SME industry too. According to Future of Business, 50 per cent of the SMEs got closed down between January and May 2020.

Due to the digital gap, numerous SMEs are unable to switch to online platforms, unlike other large businesses. Multiple SMEs have already changed to online platforms; however, many are struggling because they either do not have proper knowledge about the navigation system or do not have access to the internet itself. Without accurate guidance and technical expertise, it can be daunting for entrepreneurs to operate their business online. Thus, it is vital to enhance digital skills among everyone, especially the youths and the poor.

Fortunately, numerous organisations nationwide have been trying to promote the penetration of SMEs. To that end, Daraz has recently created different ways for SMEs to switch to online platforms and conveniently reach local and global markets. Intending to empower entrepreneurs across the country, Daraz promises simplified solutions to accelerate digital transformation, simultaneously supporting SMEs for their growth. Daraz also provides retailers loan facilities from Tk 0.1 million to Tk 4.0 million, depending on the business requirements, enabling SMEs to take the first steps to achieve their growth goals. Moreover, multiple telecommunication companies are trying to provide enterprises with connectivity solutions to meet emerging connectivity needs.

Moreover, numerous people who are stuck in their homes during the pandemic or have lost their jobs have opened their businesses through online platforms. Some of these businesses have already grown to be successful, leading them to open physical stores and hire people. Other successful enterprises are hiring people to manage online operations. All these boost the economic growth, which is beneficial for the country, at least during the crisis.

Thus, it is clear that ICT creates unlimited opportunities for people nationwide, and it is vital for the country to increase its penetration. The internet has become one of the primary and essential infrastructures of the world. According to World Economic Forum, each additional 10 per cent of internet penetration has the power to increase per capita GDP growth by 1.2 per cent in emerging countries, like Bangladesh.

It is commendable that the government and multiple companies have been working towards the development of ICT and have already been successful in numerous projects. Digitalisation will fuel the economy further. Thus, to further accelerate the process, both public and private sectors have to ensure robust digital infrastructure and services to close the digital gap. The network services need to be affordable, and smartphone penetration needs to increase substantially. 

Both public and private sectors have to work together to create digital skills and provide training to the people, especially the youth, to tackle future challenges. Finally, they need to foster social and economic equality within the economy, as it is very easy for few businesses to take advantage of the internet and create monopolies in the market.

ICT is a powerful tool, and closing the digital divide will play a critical role in Bangladesh's development, especially during the pandemic and post-COVID. It can increase social and economic equality, favour social mobility of people, innovation, and boost economic growth. Additionally, ICT will help the SMEs and decrease illiteracy, poverty, malnutrition, discrimination, unemployment, and many more.

Fuad Arefin Tonmoy is Chief Commercial Officer, Daraz Bangladesh Limited.  [email protected]

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