Transforming Sri Lanka to an inclusive digital economy

The Government under the leadership of President Ranil Wickremesinghe intends to transform Sri Lanka into a sustainable, digital society by leveraging advanced, technology-based solutions through the DIGIECON 2030 program. The 2024 Budget has allocated Rs. 3 billion to implement digital economy-related activities. 

Wickremesinghe during the Budget speech, mentioned that steps will be taken to establish a National Centre for Artificial Intelligence to ensure economic and social transformation, based on the latest trends in digital technology and artificial intelligence in addition to the proposal to form a technological innovation council to encourage technological innovation in coordination with the public sector, technical institutions and civil society.

The digital economies in developed countries contribute approximately 40% to their GDPs, while Sri Lanka’s equivalent contribution is currently estimated to be at 5% ($ 3.7 billion). Federation of Information Technology Sri Lanka (FITIS) Chairman Indika De Soysa had recently expressed the intention to elevate this share to 20% and increase the current contribution of $ 3.7 billion to $ 15 billion.

President Wickremesinghe, addressing the National ICT Awards last month, pointed out that embracing ICT is no longer a choice but a necessity. As per the UN, digital advances can support and accelerate achievement of each of the 17 Sustainable Development Goals – from ending extreme poverty to reducing maternal and infant mortality, promoting sustainable farming and decent work, and achieving universal literacy.

The COVID-19 pandemic accelerated the digital transformation and changed the way societies and businesses function forever. In fact, digitalisation helped businesses around the world during the pandemic, enabling them to overcome lockdowns through remote work and online operations. The Sri Lankan businesses too were compelled to rely on digital platforms to carry out their sales and operations during this period.

Further, the pandemic brought about a massive shift to digital payments, which is unlikely to disappear even though we have now returned to normalcy. In Sri Lanka too, the usage of cashless payments is rising, particularly among the youth and professionals. The 2023 Budget made it mandatory for all Government payments to be made electronically (online) with effect from 1 March 2024, including cash grants to the respective recipients as well as the payments for obtaining services from various Government agencies by the public. However, some Government agencies are very slow and lethargic in terms of adopting online payments. Our neighbour, India recorded 89.5 million digital transactions in 2022 and topped the list of five countries in digital payments. Prime Minister Narendra Modi is providing a huge encouragement to make India cashless, and on numerous occasions he has urged the country’s small traders and daily wage earners to embrace digital payment channels.

Governments all over the world are showing an inclination towards delivering public services through digital mechanisms due to greater accessibility, accountability as well as less bureaucracy. Last June, the Department of Immigration and Emigration launched an online passport application platform, enabling citizens across the country to obtain a passport without coming to the head office in Colombo, and this has provided a huge convenience to the general public. As part of the seven-year plan (DIGIECON 2030), the Government intends to establish a Universal Digital Identity platform, streamline Government payments, and launch a digital nomad visa scheme in addition to a single-window approval process for the ICT sector.

The ICT/BPM industry is also an integral element of the island’s digital economy. The industry has set a target of $ 5 billion export revenue by 2025. Over the past decade, the ICT-BPM industry had observed a substantial expansion and had some of the strongest growth among all export sectors.

In the quest towards a digital economy, it is essential to ensure that the interests of marginalised groups who lack IT literacy such as elderly and people with disabilities are given special consideration to make the digital economy truly inclusive.