[🇧🇩] Telecommunication Industry in Bangladesh

[Saif]

Handset production rose 17% in 2024 but challenges persist

Handset production in Bangladesh increased by 17.17 percent year-on-year in 2024, but local assemblers faced significant challenges due to sluggish sales and the rapid expansion of the grey market.

www.thedailystar.net

Handset production rose 17% in 2024 but challenges persist

Handset production in Bangladesh increased by 17.17 percent year-on-year in 2024, but local assemblers faced significant challenges due to sluggish sales and the rapid expansion of the grey market.

The local plants produced 2.73 crore units in 2024, up from 2.33 crore in 2023.

However, the production volume has dropped compared to the preceding years as it had reached an all-time high of 3.16 crore in 2022 and 2.95 crore in 2021.

The latest increase in production did little to raise hopes for local assemblers as an increase in taxes, alongside the rise in the exchange rate of the US dollar against the taka, upended capacity expansion and profits.

Bangladesh's journey in handset manufacturing began in 2017, when the government offered substantial tax benefits to encourage local production.

This policy spurred a meteoric rise in output, from only 40,000 handsets produced by Walton in 2017 to an impressive 3.16 crore units in 2022.

Global brands like Samsung, Oppo, Vivo, and Tecno established manufacturing plants in the country to capitalise on the growing market.

However, the sector experienced a sharp downturn in 2023, with production declining by 26.35 percent year-on-year.

This downturn was driven by several factors, including the high currency exchange rate, an increase in taxes, and a decrease in consumer purchasing power.

Consumers significantly tightened their spending owing to inflation remaining persistently high for the past two years.

The price of handsets has increased by about 40 percent in some cases due to the US dollar price hike.

Despite modest growth of 7 percent to 8 percent in overall sales, the sector struggled under the weight of these challenges, said Rizwanul Haque, vice-president of the Mobile Phone Industry Owners' Association of Bangladesh.

According to him, local assemblers now face a complex tax structure, including VAT of up to 7.5 percent at the factory level, customs duties of 8 percent to 10 percent on components, and an additional 5 percent VAT at each stage of sale.

In contrast, neighbouring countries like India benefit from lower tax rates, making their products more competitive.

The dominance of distributors and retailers further squeezed local producers' profitability.

Meanwhile, the grey market, offering cheaper, often smuggled phones, continues to expand unchecked, undermining legitimate sales, Haque said.

According to the association, the grey market now accounts for 35 percent of the total handset demand in Bangladesh.

Bangladesh's potential to become a regional manufacturing hub faces significant hurdles. Countries like India and Pakistan are advancing in component manufacturing, with policies favouring relocation and investment from China, added Haque.

Local assemblers add only about 20 percent value as critical components like chips, displays, cameras, RAM, and batteries are imported.

To compete, Bangladesh must address its high tax regime, strengthen local supply chains, and focus on political stability to attract investment and bring stability to the industry, he said.​

 

[Saif]

BTRC initiates telecom licensing reforms for better services

The Bangladesh Telecommunication Regulatory Commission (BTRC) has launched efforts to reform the country’s telecom licensing regime to align with contemporary demands.

www.thedailystar.net

BTRC initiates telecom licensing reforms for better services

The Bangladesh Telecommunication Regulatory Commission (BTRC) has launched efforts to reform the country's telecom licensing regime to align with contemporary demands.

A committee, led by BTRC Commissioner Brig Gen (retd) Iqbal Ahmed, has already held three meetings to restructure the network and licensing roadmap.

BTRC Chairman Maj Gen (retd) Md Emdad Ul Bari shared this information at a press conference at the commission's office in Dhaka yesterday.

"Currently, we observe that many licences are functioning as intermediaries, increasing costs instead of promoting cost efficiency. We intend to review this and strive for a licensing framework that is streamlined, effective, and efficient," he said.

Bari said that the reforms aim to safeguard consumer interests rather than protect business entities. The initiative seeks to foster healthy competition and collaboration among stakeholders, including consumers, businesses, and the government.

Addressing challenges such as transitioning from existing licences, establishing sustainable investment policies, and creating effective regulations, the BTRC plans to submit its reform proposals to the government by March.

The chairman acknowledged the need for consumer-centric policies to ensure sustainability and facilitate, rather than regulate, telecom companies.

He said the committee would streamline complex network structures, reduce pressure on spectrum usage, and enhance fixed broadband services. The commission also aims to adopt green technologies and promote active sharing to support digital service expansion.

He mentioned plans to eliminate unnecessary licences and terminate licences that hinder healthy competition.

The proposed framework will address gaps in clear and sustainable policies, which have deterred investor interest, he said.

Regarding 5G, Bari said that consultations are ongoing, and preparations are underway to auction the 700 MHz band spectrum by June.

However, no definitive timeline for the 5G rollout has been established.

The BTRC will also advise the government on developing policies that position telecom as a key enabler of digital development, focusing on simplified, efficient, and cost-effective networks to meet growing digital demands, he said.

He said VAT and taxes are the government's concern, not the BTRC's. However, VAT and taxes should be reduced as much as possible. Internet services need to be more accessible.

Regarding attracting foreign investment in the telecommunication and internet sector, Bari said that to attract foreign investment, the country must establish investment-friendly regulations. Companies like Amazon, Google, and Meta have emphasised that liability for social media posts should rest with the individual who made the post, not the platform itself.

"We will communicate this perspective to the government," he added.​

 

[Saif]

Grameen Telecom gets digital wallet licence

Samadhan Services Limited, a concern of Grameen Telecom, has at last gained ground in its effort to become a payment service provider (PSP) in Bangladesh.

www.thedailystar.net

Grameen Telecom gets digital wallet licence

Samadhan Services Limited, a concern of Grameen Telecom, has at last gained ground in its effort to become a payment service provider (PSP) in Bangladesh.

Authorities of Samadhan Services had first applied to the country's central bank for a PSP licence on November 16, 2021.

However, the Bangladesh Bank delayed its decision in this regard until August 2024 although the company fulfilled the requirements to receive a No Objection Certificate (NOC).

The central bank finally granted the NOC on September 29 last year, clearing the way for Samadhan Services to secure its PSP licence, according to officials associated with the process.

Officials of the Bangladesh Bank claimed that high-ups, former governor Abdur Rouf Talukder in particular, had purposefully delayed the process.

They said the delay was enforced as an extension of former prime minister Sheikh Hasina's alleged animosity towards Grameen Telecom and its founder, Nobel Laureate Prof Muhammad Yunus, who is now chief adviser to the country's interim government.

Rouf had resigned as Bangladesh Bank governor soon after the Awami League government was ousted by a mass uprising on August 5 last year.

The application from Grameen Telecom was initially reviewed by the central bank's Payment Systems Department, which found that the company had provided satisfactory documentation to move ahead with the process.

As such, the case was eventually forwarded to the-then Bangladesh Bank Governor Rouf in December 2023. But it was not approved at that time, central bank officials said.

The Daily Star tried to reach Rouf over phone to comment on the matter, but his phone number was found switched off.

Md Nazmul Islam, managing director of Grameen Telecom and a director of Samadhan Services, told this newspaper that they are yet to obtain the licence despite securing the NOC.

"The central bank withheld the NOC, but we do not know why," he said.

"Still, we are relieved to have finally received it," Islam said, adding that Samadhan Services is preparing to enter the local market soon as a digital payment service provider.

BANGLDESH BANK'S REQUIREMENTS

The Bangladesh Bank issued a one-year NOC to Samadhan Services, with the company now required to meet several regulatory conditions to secure the final licence.

For example, the company has to raise its paid-up capital to Tk 20 crore and maintain it at this level.

The proposed digital wallet company must also implement anti-money laundering and counter-terrorism financing policies, ensure customer due diligence, and comply with ICT security standards for scheduled banks in the country.

Besides, it must complete software quality and vulnerability assessments, enforce data backup and retention policies, and develop accurate network architecture and topology as stipulated.

WHO'S BEHIND SAMADHAN SERVICES?

The board of directors of Samadhan Services comprises of nine members, primarily nominated by Grameen Telecom.

The company's chairman, M Shahjahan, is a former managing director of Grameen Bank while its managing director, Md Ashraful Hassan, is chairman of Grameen Telecom.

Nurjahan Begum, another director nominated by Grameen Telecom, is the adviser on health and family affairs to the interim government. She is also a former managing director of Grameen Bank.

Meanwhile, Nazneen Sultana, managing director of Grameen Communications, is serving on the board as well.

Other board members include Sohel Ahmed, managing director of Grameen Shakti, and Md Nazmul Islam, managing director of Grameen Telecom.

The remaining directors -- SM Huzzatul Islam Latifee, Mahmud Hossain and Saleem Ahmad Khan -- were also nominated by Grameen Telecom.

A PSP facilitates electronic payment processes and transaction settlements through scheduled banks or financial institutions.

At present, there are eight PSPs in the country licensed by the central bank, including iPay Systems, D Money Bangladesh and Recursion FinTech.

Industry insiders said mobile network operators Robi and Banglalink are keen to enter the digital wallet business while online marketplaces like Daraz and Chaldal have already applied for PSP licenses.​

 

[Saif]

Reimagining Bangladesh’s telecom future

Returning to Bangladesh after more than a decade is both a homecoming and a rediscovery for me. I see a country alive with the energy of resilient youth and shaped by a relentless spirit for progress.

www.thedailystar.net

Reimagining Bangladesh’s telecom future

Returning to Bangladesh after more than a decade is both a homecoming and a rediscovery for me. I see a country alive with the energy of resilient youth and shaped by a relentless spirit for progress.

This Bangladesh holds within it the promise of becoming a beacon for the region -- a nation poised to take its place among the world's great stories of progress.

But as someone who has walked the corridors of the domestic telecom industry since its formative years, the experience has given me a multi-dimensional perspective on its journey.

I am reminded that connectivity is not just a service; it is the invisible thread binding dreams to reality, powering economies, and bridging the distance between potential and achievements.

The telecom sector, a vital driver of the country's socioeconomic transformation, contributed around 1.05 percent of the national GDP in fiscal 2023-24, according to data of the Bangladesh Bureau of Statistics.

Furthermore, the telecom industry is one of the largest contributors of foreign direct investment (FDI). Since inception, approximately Tk 150,000 crore has been invested in the industry till 2023. Also, it has generated about 900,000 jobs, underscoring the crucial interplay between telecommunications growth and overall economic prosperity.

Despite all of its contributions, the sector is shadowed by structural constraints and regulatory uncertainties. Therefore, the question remains: Are we ready to give this sector the space and tools it needs to help Bangladesh soar into a digital future?

Imagine an eagle, born to soar among the clouds, yet its wings are clipped. Its eyes scan the horizon, but flight remains a distant dream. This is the reality of our telecom industry -- immense potential shackled by frameworks and inefficiencies.

A major obstacle is the unpredictable and unfavourable regulations along with micromanagement, which created a climate of uncertainty that hampers innovation and deters investment.

The industry, which thrives on agility and forward-thinking, is also bogged down by overly prescriptive policies, lengthy approval processes, frequent policy changes and a lack of clear dispute resolution mechanisms.

Despite Bangladesh being a promising market, such unpredictability not only delays progress, but poses risks and erodes investor confidence.

Besides, the fragmented licensing regime complicates rather than facilitates growth. Operators are prohibited from managing their own transmission infrastructure or constructing fibre networks. So, they instead rely on multiple intermediaries, often hindering service quality.

Moreover, the absence of uniform KPIs have created an accountability vacuum across the value chain. This fragmented value chain inflates operational costs, reduces efficiency and stifles accountability, ultimately resulting in customer dissatisfaction.

Without addressing these issues, we risk widening the digital divide and holding back the very communities that stand to gain. Therefore, it is worth reflecting on whether we are creating a regulatory environment that empowers the telecom sector to innovate and grow, or are we inadvertently letting these frameworks dictate its trajectory?

To unlock the telecom sector's potential, we need a regulatory framework that fosters innovation, encourages investment and promotes competition. By consolidating fragmented regimes and allowing operators to build and manage their own infrastructure, we can reduce inefficiencies and lower costs, ultimately improving service delivery. A shift from micromanagement to principle-based regulation would further empower the sector. Finally, a stable and predictable regulatory environment will add speed and efficiency in the journey of building a prosperous, inclusive digital society.

The choice before us is profound: Do we embrace a future where innovation thrives, investments flow, and opportunities expand, or do we accept a status quo that limits what it could be?

The author is chief corporate affairs officer of Grameenphone​

 

[Saif]

Bangladesh signs MoU with ADB to develop country’s first green data centre

The Posts and Telecommunications Division under the Ministry of Posts, Telecommunications and Information Technology, BTCL, the Public-Private Partnership Authority (PPPA), and the Asian Development Bank (ADB) has signed a memorandum of understanding (MoU) to develop the country’s first green...

www.thedailystar.net

Bangladesh signs MoU with ADB to develop country’s first green data centre

Representational image generated by using AI/Canva.

The Posts and Telecommunications Division under the Ministry of Posts, Telecommunications and Information Technology, BTCL, the Public-Private Partnership Authority (PPPA), and the Asian Development Bank (ADB) has signed a memorandum of understanding (MoU) to develop the country's first green data centre under a public-private partnership (PPP) model through international competitive bidding on 27 January.

The green data centre, which will be established on BTCL-owned land near Chattogram, will adhere to international standards to ensure high availability and operational scalability. It will be powered by renewable energy and offer commercial colocation services for both public and private sector enterprises while also meeting BTCL's internal data storage requirements, according to a recent report by Bangladesh Sangbad Sangsha (BSS).

With similar functionalities to a data centre, a green data centre conserves data while minimizing its environmental impact like reducing carbon emissions and energy consumption.

A transaction advisory services (TAS) agreement will soon be signed to implement the project under the PPP model. ADB's advisory support will focus on feasibility assessments, project structuring, tendering, and stakeholder capacity-building while fostering an investment-friendly environment for private sector participation in Bangladesh's digital economy, according to BSS.​