Electronic Commerce Vis-a Vis Digital Bangladesh

The recently held 12th WTO Ministerial Conference has taken a number of decisions to make Electronic Commerce more effective and operational. These decisions shall have immense impact on the digital world. People all over the digital world have a mixed reaction about the operational programme of WTO. To many, there is a confusion between electrical and electronic issues. Hope this write up will to some extent remove the confusion as well as misconception. From Bangladesh point of view an overview is placed for better clarification of the operational aspects of electronic commerce vis-a-vis digital Bangladesh. The decisions taken at WTO are continuation of moratorium on custom duties on electronic transmissions and no further imposition of custom duties on electronic transmission which includes online delivery of music, books, films, software, video games and other business and commercial transactions. Therefore, it will not be an exaggeration to say that electronic commerce and digital activities are complementary to each other.

There is no universally accepted definition of the term “Electronic Commerce”. However, it is generally used to cover the distribution, marketing, sale or delivery of goods and services by electronic means. The rapid growth in electronic commerce during the last decade has been due to the increasing use of Internet for commercial purposes.

Virtually all products can be sold on the basis of information available on the Internet. Information on prices, quality, delivery and payment conditions enable the manufacturers, retailers, consumers in far off countries to order their requirements from the most competitive suppliers. Physical goods are then delivered by other means of transport. It is increasingly possible to deliver certain types of products electronically; in fact any product that can be reduced to a digital format can be delivered in this way. In developing countries like Bangladesh potential product range from financial, insurance services, audio visual products, news, and information services, telecom services, technology services and soft wear. In the present day computer soft wear is the leading product sold via Internet.

Electronic Commerce provides consumers and business enterprises with information on the availability world wide of products or services, prices, and conditions of sale, enabling them to obtain supplies or the best terms possible. It provides suppliers with an online marketing service and enables them to do business without opening an establishment or to hire an agent abroad. Virtual shops and contact points on the Internet, by facilitating communication, eliminating some delays in the flow of supplies. The quick and assured availability of supplies may enable industries, wholesalers and retailers to reduce the levels of inventories and stocks they hold. This helps small and medium sized companies to reduce their costs.

Developing countries lag far behind developed markets in the availability of the technical requirements for conducting e-commerce. This is partly attributed to inadequate development of their telecommunication infrastructure and high costs of using Internet including the costs of routers and other computing facilities. Internet charges are significantly higher in developing economies than developed economies. The subscription charges are almost prohibitive and beyond the reach of common men. Long distance telephone calls giving access to the Internet is significantly higher in many developing countries.

Many of the human skills needed for e-commerce distinct from those required for other forms of trade. The more stages of a commercial exchange are carried out electronically, the more specific are the skills required. Basic computer knowledge and knowledge of the Internet are needed even to search a product on Internet. Extensive language skills are required to browse foreign Internet sites. Even to advertise a product thorough Internet designing skills are required. Most of the developing countries do not have human resources capable to work in these areas.

Physical products that are ordered from other countries electronically are delivered by air, rail, road or sea. Customs duties are collected on such products at the border, like duties collected on products ordered through non-electronic means. However, products like books, films, music may be digitized and transmitted to consumers directly. This may lead to an anomalous situation as Internet trade grows. A book or a CD record may have to pay customs duties when crossing the border, while the digitized version of those delivered direct to consumers through the Internet would escape such duties. In such cases it may be difficult to collect Internet taxes (VAT and Sale tax) on such products. Recent research shows that non-collection of customs duties on digitized products may not have serious implication for a country’s revenue. Only a few countries have high duties on products that can be rendered digital and customs duties collected on such products contribute only a small share to the government revenue even in those developed countries.

Trade and business communication through electronic means give rise to a number of questions of legal nature. For example, questions like “What is the origin of electronically traded products? When is an electronically delivered product ‘domestic’ and when ‘imported’? How do businessmen who use electronic means of communication deal with situation in which national laws or international convention applicable to International trade transaction requires ‘written ‘agreements’ ‘original’ documents or ‘manual’ signature? How can the authenticity of a message be secured, so that parties will know with certainty the identity of a sender of an electronic message or enable them to verify that an electronic message has not been altered in transmission?” Uncertainty over the enforcement and potential for redress of electronically concluded contract may create obstacles to the development of electronic commerce across the globe. A number of initiatives at the international levels have been taken to assist governments to deal with inadequacies in applicable laws. UNCITRAL is responsible for promoting the harmonization and unification of international trade laws has undertaken work which has led to adoption of a Model Law establishing rules and norms for validation and recognition of contracts formed through electronic means. Same initiatives have also been undertaken by individual countries, the European Commission and international organizations to deal with the legal issues arising from electronic commerce.

Bangladesh by breaking all traditional marketing concepts has been working in the arena of Electronic Commerce to fulfill the aim of Digital Bangladesh. UNDP has launched ‘Anondomela’ (www anondomela shop) as a free of cost alternative market place. Entrepreneurs are hosting their products on the site, which allows buyers from the comfort of their homes to order products on the site directly from Small and Medium Enterprises (SMEs). ICT has immensely helped people across the country to overcome the hardship rendered by COVID -19 pandemic by taking the support of “Digital Bangladesh”. UNDP is extending help to capacity building, training digital marketing concept , user friendly mobile application , help support Unique Business Identification creation, market linkage, advocacy for access to financial resources etc. for SMEs. In Bangladesh retail electronic commerce is growing at a rate of 72 a month. At present more than 35000 individuals and above 2500 SMEs are part of the sector.

A wide range of technologies is used in e-commerce that includes electronic data interchange (EDI) and Electronic Fund Transfer (EFT). In Bangladesh small, medium and large enterprises have taken up e-business platform. In Bangladesh there is room for improving g the business structure and raise productivity by using e-commerce as a medium. According to BTRC the number of Internet subscribers has crossed 80.6 million. At present there are nearly 2000 e-commerce sites and 50,000 Facebook based outlet delivering 30,000 products a day. Currently 80 per cent of the online sales are taking place in Dhaka, Chattogram and Gazipur. According to market analysts the e-commerce business market would reach to US $20 billion. Although the e-commerce sector in Bangladesh has grown over the years, there are a number of obstacles. Some of the key challenges are net neutrality, high speed net, parcel delivery logistics and assurance of quality products. Foreign players also pose competition and risks to local start up. E-commerce industry is an emerging industry in Bangladesh. The sector needs protection. On the other hand foreign investment is required in this sector. Despite the obstacles the sector has potential and within the next few years it will contribute significantly to GDP and employment creation.

Digital Bangladesh idea was first mooted by the prime minister in December, 2008. Starting with utter disbelief of many, only due to the conviction of the prime minister , a technology backward country has made a remarkable journey towards mass digitization. The process of digitization has been adopted by all government departments and almost every sphere of the society. During the Covid-19 lockdown Digital Bangladesh played a key role in ensuring service continuity in health , education , commerce and trade, social safety net payments for the new poor, grievance redress etc. Digital Bangladesh aims to become a prosperous developed poverty free country by 2041. Today Digital Bangladesh is bringing tangible benefits to citizen especially the rural poor. This was possible because of the sheer inspirational leadership demonstrated by the government which augmented people’s hopes and aspiration and self -belief. Digital Bangladesh is being implemented by all agencies of the government. The road to 2041 will be largely dominated by machine, popularly known as Artificial Intelligence (AI). More progress has been made in the last 5 years that master the electro chemical, nanotechnology attached to Internet. Robots co-exist with human being in all service sectors. Due to digitization extreme poverty is no more in Bangladesh. In the last 13 years Internet penetration in Bangladesh has gone up 100 times. This means that about 100 times more Bangladeshis are able to take advantage of the Internet for information, education, recreation, business, trade , health care etc. In Bangladesh almost everybody has access to mobile phone.

The government, private sector, and citizens believe in Digital Bangladesh and are hoping to transform this vision into reality. Service delivery has been improving using ICTs. Because of ICT, the development of the whole society towards a knowledge economy and diversification of exports have taken place. Therefore by 2041 Bangladesh vision will be different in terms of both structure and the concept. The foundation of Digital Bangladesh has been set. All government services are on the path of being fully digitised. Let us wait for a better future for Digital Bangladesh.

The writer is former Director General of EPB. He can be contacted at [email protected]