Bangladesh should develop and upgrade ICT infrastructures before implementing restrictions of Cross Border Data Flows (CBDF) as restricting data flow could be a hindrance in taking full advantage of the rapidly evolving data analytics and techniques, said economists and experts.
They also suggested for policy in favor of data localisation and its restrictiveness which needs a comprehensive cost benefit analysis, reports BSS.
The observations and recommendations came from a webinar held today on 'digital exports of Bangladesh: impact of cross-border data flow restriction' jointly organized by Research and Policy Integration for Development (RAPID) and CUTS International.
Member (Secretary) of Planning Commission Dr Md Kawser Ahmed was the present as chief guest while RAPID Chairman Dr Mohammad Abdur Razzaque presented the keynote paper on a study in this regard.
Dr M Abu Eusuf Executive Director of RAPID and Professor of Dhaka University moderated the webinar.
The country's digital services exports (DSEs) might decline by 29 per cent to 44 per cent depending on the severity of cross-border data flow (CBDF) restrictions and retaliatory measures, according to the study.
"As a result, Bangladesh's gross domestic products (GDP) would shrink by 0.6 to o.9 per cent," read the report titled 'Impact of Cross-border Data Flow Restrictions on Bangladesh Economy' jointly done by Research and Policy Integration for Development (RAPID) and CUTS International.
Any policy in favor of data localisation and its restrictiveness needs a comprehensive cost benefit analysis as restricting data flow could be a hindrance in taking full advantage of the rapidly evolving data analytics and techniques, it noted.
Dr Abdur Razzaque said as businesses are increasingly relying on data with increasing digital transformation and easier global digital trade, risks of data misuse, data privacy, and security concerns have increased.
Consequently, countries, including Bangladesh, are beginning to consider policies that regulate data privacy, security, and CBDP, he said, adding that such measures also include blocking the transfer of data across borders (data localisation) and/or place conditions on the flows of data and its storage and processing.
The recently released draft Data Protection Act also restricts the transfer of sensitive data, user-generated, and classified data, outside Bangladesh without prior approval of the government, he noted.
Bangladesh's ICT sector had an impressive annual growth facilitated by CBDF and the ICT exports of Bangladesh stood about at $2 billion in 2021 and experienced an impressive growth over the past decade.
The country envisages achieving $5 billion in ICT exports, employing two million professionals by 2025 and making the ICT industry the next growth engine for the country's economy, he noted.
Speaking on the occasion, GED member Kawser Ahmed stated that Bangladesh is moving towards 'Smart Bangladesh' according to Vision 2041 as an evolution from 'Digital Bangladesh'.
He added that government is implementing several projects to promote digitalisation including CUET digital incubation centre, new digital university in southwest Bangladesh and incentivizing polytechnic education.
He emphasized on the need for comprehensive cost-benefit analysis to understand the impact of cross-border data restriction. He also stated given the nascent IT sector, Bangladesh should consider imposing any restriction in 5 years down the line.
In his presentation, Dr Razzaque highlighted those empirical studies have indicated that such restrictive policy measures could adversely impact digital trade, affecting innovation, economic growth, and foreign direct investments (FDI).