Sri Lanka has progressed through numerous challenges during the past few decades, such as thirty years of civil war, the tsunami disaster, the Easter Sunday terrorist attack, and the COVID-19 global pandemic. Currently, Sri Lanka is facing its worst economic crisis since gaining independence in 1948. To get through these challenges, all previous governments have recognised the importance of developing a robust information and communication technology (ICT) sector to drive economic growth and enhance resilience against future economic shocks.
The Sri Lankan government began promoting ICT as a key development priority with the end of the civil war in 2009. The government and other authorities developed a number of programs under the slogan “A technology-based society,” most of which were promoted under three pillars: digital government, digital economy, and digital society. Fortunately, Sri Lanka had all the regulatory infrastructure and facilities needed to start these programs at the time. For instance, the establishment of the “Telecommunications Regulatory Commission of Sri Lanka (TRCSL)” in 1996, the implementation of the ICT Act in 2003, and the establishment of the “Information and Communication Technology Agency of Sri Lanka (ICTA)” in the same year can be mentioned.
Even though projects like e-Sri Lanka, which the World Bank partially funded in 2002, and the Global Knowledge Centers, which launched in 2004 as a component of e-Sri Lanka, as well as the establishment of 1,000 telecenters called Nanasala, were initiated from time to time to enhance the digital skills of Sri Lankans, it is debatable whether Sri Lankans were able to fully benefit from them given the country’s circumstances such as the civil war at the time. Mahindyodaya Technological Laboratories, a program started by the government after the civil war, aimed to build a thousand technological laboratories island-wide, and it is also currently in its final stages.
Additionally, the Information and Communication Technology Agency of Sri Lanka, as the apex ICT body of the Sri Lankan government, recently launched a campaign called “Technology-based society and a smart nation.” This program, like many others, aims to foster digital skills among ordinary Sri Lankans through the development of ICT infrastructure. However, Sri Lanka’s ICT industry is still in its infancy. According to the Central Bank Annual Report of Sri Lanka for 2021, the ICT sector contributes 4-5 percent of the country’s GDP (compared to about 13 percent in India and Bangladesh). And the ICT contribution to the nation’s overall exports is only around 7 percent. Although the government could identify how the ICT sector influences the country’s economy and launch several programs to enhance it, the results of these programs have not benefited all citizens evenly. This is one of the reasons why the ICT sector has failed to drive Sri Lanka’s GDP properly.
According to the Department of Census and Statistics of Sri Lanka, in the year 2017, the computer literacy rate of the country was 28.6 percent which increased to 32.3 percent in 2020. Even though the authorities had introduced numerous programs with the intention of uplifting the computer literacy rate and the digital skills of Sri Lankans, it is still doubtful whether it has succeeded enough in influencing the people. Nonetheless, the Sri Lankan ICT sector was a ray of light in the gloomy 2020, when the COVID-19 pandemic had a significant negative impact on the country’s economy and people’s day-to-day activities. For instance, virtual education systems and virtual working environments were frequently used during the pandemic compared to the times before. The infrastructure needed to establish these services, such as high-capacity servers and internet connectivity expansions, was also developed within a shorter period. During this period, the “Lanka education and research network (LEARN)” platform introduced by the educational sector was able to interconnect all the universities under the University Grant Commission and all the other government education institutes. This provided vast digital space for students island-wide with other benefits such as free internet and video conferencing.
In addition, several ICT innovations during the COVID-19 pandemic significantly contributed to the sector’s growth. For example, the implementation of new software by the Sri Lankan health sector, such as the National COVID-19 Surveillance System and District Health Information Software. The Telecommunications Report Sri Lanka 2021 also reported the growth of the ICT sector in Sri Lanka during the pandemic, as the country’s overall monthly data usage climbed to 150 million GB at the end of 2020 from only 60 million GB in January 2019. Similarly, a massive expansion of internet-based online businesses, such as direct shipping, dropshipping, online content creation, cryptocurrency trading, online gaming, and streaming, were also noticed during this time.
Unfortunately, the ICT sector is being badly impacted by a number of factors related to the economic crisis Sri Lanka has been facing since early 2022. The authorities mandated and implemented remote working and learning settings due to frequent power outages and transportation problems caused by fuel shortages. People have also experienced soaring price increases for ICT products due to foreign currency restrictions and the recently enacted government importation prohibition. Although it is yet too early to discuss how this would impact the ICT sector as a whole, it is obvious that the specialists need to handle the situation quickly. Based on the recent statement issued by the Federation of Information Technology Sri Lanka, they are expecting to discuss with the country’s current president about the implications and impacts of the import ban on the prices of ICT devices and peripherals of the country and the growth of the ICT sector as a whole. Looking back, Sri Lankans’ digital inclusion and online participation have undergone a progressive transformation. The biggest obstacle Sri Lanka must overcome on the route to inclusive development is the current economic crisis. For that, the Sri Lankan ICT sector can play a significant role in overcoming this catastrophe. Given the circumstances, it is essential to pinpoint the ICT sector’s positive contribution to the nation’s inclusive growth, as it will certainly serve as one of the strong foundations of the journey to build a community that is digitally inclusive while meeting the current demands of the nation.
Prabath Perera is a PhD Candidate at the Department of Accounting, Finance and Economics and Griffith Asia Institute, Griffith University.