Bangladesh ICT & Software Services Analysis
ICT Exports, the Missed $5B Target, and the Cyber Security Ordinance
BDPolicyLab · 2026-06-15
Bangladesh recorded $724.6 million in ICT service exports in FY2024-25 (EPB, +7.7 percent year on year), equal to 14.5 percent of the $5 billion target the ICT Division set under the previous government for 2025: a shortfall of about $4.28 billion, or 85.5 percent below the target. Computer services (software, outsourcing, IT-enabled services) make up 87 percent of the recorded total. The gap is not a measurement artifact: World Bank balance-of-payments data put calendar-year 2024 ICT service exports at $715 million, and industry estimates reported in the trade press put the full figure near $1.0 billion once informal freelancing channels are counted. The binding constraints are workforce depth and the value mix, not ambition. The Cyber Security Ordinance 2025 and Hi-Tech Park expansion now sit with ICT Minister Fakir Mahbub Anam Swapan, in office since 17 February 2026 under the BNP government of Prime Minister Tarique Rahman.
Key findings
- Recorded ICT service exports were $724.6 million in FY2024-25 (EPB), up 7.7 percent. World Bank balance-of-payments data put calendar-year 2024 ICT service exports at $715 million (indicator BX.GSR.CCIS.CD, $715,028,938); the small difference reflects fiscal versus calendar year coverage of the same flow. Computer services account for 87 percent of the recorded total, telecom services 13 percent, information services under 1 percent (The Business Standard, EPB FY25 data, 2025). Industry stakeholders estimate the true figure is near $1.0 billion once export proceeds that clear through informal channels are counted (Prothom Alo, 2025).
- The $5 billion target for 2025 was met to 14.5 percent: a $4.28 billion shortfall. Recorded exports of $724.6 million are 14.5 percent of the $5 billion target the ICT Division set under the previous government, leaving the sector 85.5 percent below target. Even the $1.0 billion informal-inclusive estimate reaches only one fifth of the goal. The shortfall traces to an export mix skewed toward low unit-value gig work rather than enterprise software, cloud, and product delivery that earn more per worker.
- Bangladesh is the second-largest source of online freelance labour after India. The Oxford Internet Institute ranked Bangladesh second globally in online labour supply, behind India (OII Online Labour Index, via BIGD and Dhaka Tribune). The country has about 650,000 registered freelancers and roughly 500,000 working regularly (USAID/OII), but individual gig work does not build the firms, intellectual property, or delivery track record that win institutional IT contracts.
- The Cyber Security Ordinance 2025 replaced the Digital Security Act 2018. The ordinance, approved by the Advisory Council under the interim administration, dismissed all pending cases filed under the Digital Security Act 2018 and established the National Cyber Security Council (The Business Standard, 2025). Implementation now sits with ICT Minister Fakir Mahbub Anam Swapan, in office since 17 February 2026. The near-term test is whether the gazetted rules narrow the speech-restricting provisions that drew DSA-era criticism.
Bangladesh exports software talent, not software. Recorded ICT service exports of $724.6 million in FY2024-25 (EPB) reached 14.5 percent of the $5 billion target the ICT Division set under the previous government for 2025, a $4.28 billion shortfall, or 85.5 percent below the target. The miss is structural, not a forecasting error: the country has the second-largest online freelance workforce in the world but few firms able to win enterprise contracts, and its export mix is skewed toward low unit-value gig work. The fix is to convert individual gig income into institutional delivery capacity and to lift the per-worker value of what the sector sells.
The export figure is real, the gap is structural
Three numbers describe the same flow and reconcile. EPB recorded $724.6 million in ICT service exports for FY2024-25, up 7.7 percent year on year. World Bank balance-of-payments data report $715 million for calendar year 2024 (indicator BX.GSR.CCIS.CD, $715,028,938); the small difference is fiscal versus calendar year coverage. Industry stakeholders estimate the true figure is closer to $1.0 billion once export proceeds that clear through informal channels are added (Prothom Alo, 2025). Even that generous estimate reaches only one fifth of the $5 billion target.
The composition explains why the target was unreachable. Computer services (software, outsourcing, IT-enabled services) are 87 percent of the recorded total, telecom services 13 percent, and information services under 1 percent (EPB FY25 data via The Business Standard). Within computer services, the export mix skews toward low unit-value work: data entry, basic web development, graphic design, and content writing generate volume but compress revenue per worker. The shift toward enterprise software, cloud managed services, and AI-enabled analytics is the path to higher export intensity, but it requires delivery capacity the current firm base does not have. BASIS reports more than 1,100 member companies, most small and without the bench depth for large engagements.
Scale without depth in the freelance economy
Bangladesh is the second-largest source of online freelance labour after India, a position the Oxford Internet Institute established through its Online Labour Index (via BIGD and Dhaka Tribune). The country has about 650,000 registered freelancers and roughly 500,000 working regularly (USAID/OII), and their combined earnings are real income for hundreds of thousands of households.
The structure is fragile. Individual freelancers do not incorporate, accumulate intellectual property, or build the delivery track record enterprises require before awarding contracts. India crossed this divide through TCS, Infosys, and Wipro: fragmented individual work became institutional service delivery at scale. Bangladesh has not. The threat is now acute because AI code generation and content tools target precisely the low-skill segment where most Bangladeshi freelancers compete. If that income base contracts before an institutional base expands, the human capital pipeline weakens at both ends.
Connectivity is necessary but not sufficient
Headline reach looks adequate: 4G covers 97 percent of the population (BTRC, 2024). The operative gap is fixed broadband, which stood at 7.9 subscriptions per 100 people in 2023 (World Bank, IT.NET.BBND.P2), up from 4.9 in 2018. That is well above Pakistan but far below the densities that sustain bandwidth-intensive cloud development, remote enterprise collaboration, and video-based delivery. Mobile data cannot substitute for fixed broadband in professional environments that need sustained throughput and low latency.
The institutional layer compounds the problem. BHTPA has 39 Hi-Tech Parks planned or under construction, but activation has lagged: procurement delays, power reliability failures, and connectivity gaps make parks outside Dhaka unattractive. Talent agglomerates where connectivity is reliable, which concentrates IT employment in Dhaka and leaves the tier-2 and tier-3 talent pool stranded. The startup ecosystem reinforces the ceiling, held back by uncertainty over foreign equity, weak IP protection, and the absence of a functioning venture capital market.
Recommendations
- BTRC and the ICT Division: set a binding fixed-broadband density target. Lift fixed broadband from 7.9 to 15 subscriptions per 100 people by 2028, enforced through last-mile build-out obligations on licensed ISPs with penalties for non-delivery in tier-2 cities. Success signal: the World Bank IT.NET.BBND.P2 series clears 12 per 100 by 2027. Without adequate broadband outside Dhaka, STEM investment and Hi-Tech Parks produce workers who emigrate.
- BHTPA: activate parks with guaranteed services before opening. Sequence the 39 planned parks behind non-negotiable power and fiber service-level agreements in place from day one, and publish occupancy and uptime per park quarterly. Success signal: average tenant occupancy across activated parks exceeds 70 percent within two years. Fewer parks that work beat more parks that underperform.
- UGC and public universities: tie CS curricula to industry sign-off. Require every public university computer science program to run an industry advisory board with binding curriculum approval. Success signal: a measurable rise within three years in graduates who pass a standardized technical screen used by BASIS member firms.
- Finance Ministry and BIDA: stand up a blended-capital digital economy fund. Anchor a $150-200 million fund co-invested with multilateral development banks for seed through Series A capital, paired with regulatory sandboxes for fintech and healthtech. Success signal: at least 20 ICT firms reach Series A within four years, so domestic digital demand converts into firm formation, not just transaction volume.
- BASIS and a2i: build a freelancer-to-firm conversion track. Channel the top tier of the 650,000-strong freelance base into registered service companies through tax incentives on incorporation, shared back-office and compliance support, and preferential access to the digital economy fund. Success signal: at least 5,000 freelancer-founded firms registered within three years, so individual reputation accumulates into institutional delivery capacity.
What would change this view
If EPB and industry reconcile the recorded and informal export figures upward and the true total approaches $1.0 billion on a sustained, formally banked basis, the gap to a revised target narrows materially. If fixed broadband density rises faster than the 2028 target implies, the infrastructure constraint eases and the value-mix shift becomes feasible sooner. Conversely, if AI tools erode low-skill freelancing income before institutional firms scale, total ICT earnings could fall even as headcount holds, and regional competitors such as Pakistan, whose IT exports reached a record $3.8 billion in FY25, would capture the demand Bangladesh is positioned to serve.
Data sources: EPB via The Business Standard, World Bank (BX.GSR.CCIS.CD, IT.NET.BBND.P2), Oxford Internet Institute via BIGD and Dhaka Tribune, Prothom Alo, BASIS, BHTPA, BTRC.
Data and methodology
Recorded ICT export figure ($724.6 million, +7.7 percent, FY2024-25) from EPB via The Business Standard, cross-referenced with World Bank ICT service exports (BoP, current USD), indicator BX.GSR.CCIS.CD ($715,028,938, CY2024). Target-miss computed as 724.6 / 5,000 = 14.5 percent of target; shortfall 5,000 - 724.6 = $4,275.4 million (85.5 percent below). Sectoral breakdown (87/13/<1 percent) from EPB FY25 data via The Business Standard. Freelance ranking from the Oxford Internet Institute Online Labour Index (via BIGD); registered count (~650,000) and active count (~500,000) from USAID/OII. Fixed broadband density (7.9 per 100, 2023) from World Bank indicator IT.NET.BBND.P2; 4G coverage (97 percent, 2024) from BTRC. BASIS membership (>1,100) from BASIS via Devex. Cyber Security Ordinance details from The Business Standard, 2025. Trend series from BDPolicyLab IctSoftware analyzer against bdpolicy.db.