IT-BPO SECTOR
Compiled by Yamini Sequeira
BRAND BUILDING FOR GROWTH
Jehan Perinpanayagam encourages the promotion of Sri Lanka’s IT-BPO brand
Q: What does Sri Lanka need to do to be globally acknowledged for its Island of Ingenuity (IOI) brand?
A: Sri Lanka needs to widely disseminate its success stories and be profiled internationally, especially in analyst reports by firms like Everest Group and Kearney. Consistent promotion of the IOI brand, hosting inward delegations and extending targeted invitations to business leaders to set up operations in Sri Lanka are essential.
Sri Lanka has an impressive track record of hosting IT-BPO (IT and business process outsourcing) operations for international brands such as IFS, Sysco, London Stock Exchange Group (LSEG), HSBC, WNS and several other global brands.
India has been a close partner in recent years and HCL setting up operations here is a major success. The feedback from its global leadership about Sri Lanka’s talent is glowing.
Yet, Sri Lanka is not widely known as a destination for IT-BPM (IT and business process management) services, a situation compounded by negative perceptions from the 2022 crisis.
Q: Do we have an IT talent pool that large global corporations require?
A: Sri Lanka’s value proposition has been centred on niche offerings, high quality, specialisation and focus.
Some of our bigger projects include HSBC, Orel IT and Global System Solutions (GSS), which are engaged in AI, machine learning and image annotation, each with a workforce of around 3,000. Sysco employs over 1,000 engineers in Sri Lanka.
Graduates and outputs from state and non-state universities, and good numbers at junior levels, have been ramped up. Yet, there is a shortage of middle management and more experienced staff. Additionally, young talent requires some refinement in both technical and soft skills.
Q: What support policies does the IT-BPO sector need to fulfil its potential?
A: In terms of policies and an enabling ecosystem, the government’s digitisation initiative and Personal Data Protection Act, recent updates to labour laws, the fast tracking of digital IDs, and the adoption of digital public infrastructure, e-signatures and electronic documents are welcome developments.
But to stem brain drain, qualifying tax deductions for housing, education and vehicles should be considered as these are pressing reasons for people migrating.
Authorities should reconsider the proposed introduction of a 30 percent corporate tax for IT-BPM exports in 2025, which will make the sector uncompetitive and position Sri Lanka with one of the highest rates in the region.
To combat the shortage of talent, company sponsored visas can help bring in international talent for a few years.
For capacity building, preferential loans for laptops and students tied to three to five years of work in Sri Lanka – similar to Singapore – could be an option.
Other priorities include improving the affordability of hardware devices, which are now subject to VAT. Sri Lanka should also work on reviving tech parks coupled with incentives to attract large international players.
Q: What role can Sri Lanka’s IT-BPM sector play in green technology initiatives?
A: It’s important to focus on five key areas – talent; global trade and investment; entrepreneurship and innovation; policy and environment, social and governance (ESG); with a focus on promoting women led startups and women in tech.
Research indicates that the next unicorns will be in green technology and we want Sri Lanka to be a leading player in this space.
Q: How does Sri Lanka’s level of digitalisation compare with others in the region?
A: Fast tracking digital IDs, e-signatures and electronic documents should be prioritised.
India for example, has moved from being one of the least banked nations to having 80 percent of its population banked, using digital public infrastructure – achieving what would otherwise take a generation in 10 years through digitalisation. Today, even street vendors in India transact using digital payments.
Sri Lanka lacks computers, IT labs in schools and trained teachers. Initiatives to reduce the cost of devices, fast track teacher training and embed IT education in all schools will yield long-term dividends.
We have an opportunity to reset and build a new digital economy, which we must seize.
Q: What are the future growth avenues for the sector?
A: Sri Lanka is being positively profiled in tourism and we must do the same for IT-BPM, while working with other investment and export bodies and foreign missions on promoting our IOI brand.
We have brilliant startup ideas and great companies, but lack the ecosystem for these startups to grow and access markets. I had the privilege of visiting the Indian Institute of Technology Madras (IITM), and witnessed the incredible innovation and startups being incubated there.
Port City Colombo is a unique offering that we must capitalise on. If we can build an attractive value proposition with incentives combined with tech zones, we could bring in some of the large India based IT-BPM companies to set up their second centres in Sri Lanka.
The ‘India Plus One’ strategy has immense potential for Sri Lanka’s industry.
With the right enabling environment, we can achieve our goal of becoming a US$ 5 billion sector by 2030.
