Assignment

on
“E-Business in Bangladesh :Prospects & Major
Constraints”
Course Code: FB-504
Course Title: Electronic Business

Submitted To:
Md. Habibur Rahman
Assistant Professor,
Dept. of Finance & Banking
Jatiya Kabi Kazi Nazrul Islam University

Submitted by:
Emran Hasan
ID: 201326540
Reg No: 5060
Session: 2019-20
Master’s of Business Administration
Dept. of Finance & Banking
Jatiya Kabi Kazi Nazrul Islam University

Submission Date: 30-05 -2021

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 Table of Contents
Serial no Topics Pages

01 Abstract 03
02 Introduction 03
03 Background of the Study 04
04 Literature Review 05
05 E-commerce Concept 06
06 Types of E-Commerce 06
07 Overview the E-Commerce in Bangladesh 07
08 Historical Background of E-commerce Organizations 10
09 Prospect of e-commerce in Bangladesh 12
10 Potential Opportunity Of E-Business in Bangladesh 14
11 Constrains of E-commerce implementation in Bangladesh 16
12 Overcome of E-commerce implementation in Bangladesh 16
13 SWOT Analysis 19
14 Significance 20
15 Limitations 20
16 Recommendations 21
17 References 22

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Abstract
Now-a-days people in business are using e-business model for their business transaction around
the world. They are performing their traditional marketing now via internet. Electronic
commerce, commonly known as e-commerce which consists of the buying and selling of products
or services over electronic systems such as the internet and other computer networks. Electronic
commerce is rapidly growing as an impressive manifestation of globalization. The rapid expansion
of ecommerce is a major opportunity for local and international trade development of LDCs
including Bangladesh. As a developing country, Bangladesh is also emerging with the use of
internet and e-business. This study has a comprehensive perspective and provides a bird’s eye view
of the e-business, e-commerce and e-marketing practices. It provides e-business exercise and the
area of business operation (international vs. domestic) as well as gives an idea why marketers use
Internet in the country. Finally, this paper concludes with the potential prospects of e-business and
a brief recommendation on constraints in this sector in Bangladesh.

Introduction

Electronic commerce is a global trend; Internet usage has gained a scalable number of users, and
electronic commerce is a way to extend local markets around the global, across all borders and
time zones (Reynolds). Businesses around the globe are increasingly engaging in electronic
commerce, and sufficient technology for reliable electronic transactions exists. All businesses
including Asian businesses will need to establish an Internet presence in order to become or
remain competitive.
In the past, there were not so many opportunities for online transaction via internet due to the
unavailability of internet access in most of the places of the world. Business people as well as
consumers had few opportunities to deal with each other via online system. But now, the internet
has guided marketing discipline to various changes and strong challenges. People of the world are
now globally interconnected via internet and doing e-business with each other. The internet has
facilitated global connection between customers and suppliers regardless of geographic location
through data transfer networks. With the growth of online-based market, marketing is now
increasingly integrating the information and communication technologies.
Business market is now segregated on different format via e-business. The global business
community is rapidly moving towards Business-to-Business through e-commerce. The buyers or
the importers gain advantage of when the internet gives them access to the global market, by which
they can compare prices across regions, find out whether prices vary by order fragmentation, and
get awareness about substitute or alternative products. Business people are increasingly advertising
their products through online and promote their products. In the competitive global market, there
are many opportunities to increase business revenue, more quality sales leads, increasing business
profitability, improving business sustainability through online marketing. E-business has saved
many times, because it requires less time to process the transaction. The most well-known and

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familiar type of e-commerce is business to consumers e-commerce, which reaches to individual
consumers. Business to business e-commerce is larger and fast growing. In Bangladesh, many
firms do their business activities like taking order from customers to suppliers, designing products
etc in online. Thus, in Bangladesh, the present condition of online business is good and there are
many potentialities to improve the condition. But there are also some constraints like, poor
telecommunication infrastructure with limited fixed line access, unreliable connectivity, and low
bandwidth, lack of technically efficient personnel, absence of cyber law, inability of poor people
to buy computer etc. but the markets become competitive and more information is available.
Therefore, marketers need quick, reliable information. As a result, a fast and alternative
mechanism of communication, contract, and payment is an integral part of a globally competitive
business organization. This study presents the current scenario, opportunities and obstacles of e-
business in Bangladesh.

Background of the Study

This is the era of information and communication technology. The leading concern of electronic
revolution in this 21st century is to establish and ensure a better, easy and comfortable way of
management, communication and development with the use of information technology. E-
commerce has become a buzzword of present information technology. It is the process of
conducting all forms of business through computer network and digital communication. Increasing
domestic and global competition, economic downturn, rapidly changing market trends, and
volatile financial markets have all added to the pressure on organizations to come up with effective
responses to survive and succeed. Furthermore, easing of international trade barriers, economic
liberalization, globalization, and deregulation have led to several challenges for organizations in
developing and newly industrializing economies like Bangladesh. E-commerce is widely used in
performing B2B operations in different part of the world. Copping up the ongoing threats and
opportunities Bangladesh’s business organization`s should comply with the advancement. E-
commerce consists of all internet users of the world. The members of the community can interact
with each other at any time without considering the distance gap. Time, place and national
boundary do not make any obstacle to build and maintain the relationship. The internet has opened
up a new horizon for commerce, namely electronic commerce (e-commerce). It entails the use of
the internet in the marketing, identification, payment and delivery of goods and services. At present
internet facilities are available in Bangladesh. Slowly, but steadily these facilities are holding a
strong position in every aspects of our life. E-commerce is one of those sectors which need more
attention if we want to be a part of global business. Bangladesh is far-far away to adapt the main
stream of e-commerce application. Though government is shouting to take the challenges of e-
commerce, but they do not take the right step, that is why e-commerce dose not make any real
contribution in our socio-economic life. A question frequently strikes our mind: “Is the realities in
the developing countries like Bangladesh, where access to modern technologies is very limited,
meet the philosophy of e-commerce?” This paper aims at examining whether there is any gap
between the philosophy of the e-commerce and the reality in the developing countries like
Bangladesh and identifies the factors lies behind this gap. Then this paper suggests some measures
to be taken to minimize the gap.

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Literature Review
An expansion of the literature and an analysis of various kinds of text books, articles, journal and
common related website in the field of customer service in e-commerce are reviewed in this study.
Principles and techniques are used to introduce a general knowledge regarding to electronic
transaction and its benefit and advantages of the customer service strategy. Adding the point, a
critical analysis on theories that explains queries about how the customer service can provide that
service is one of the main stream of business for sustain and enhance the business that maintaining
the previous customer and gaining potential customers.
Buffam (2012) depicted that companies that build the better e-business solutions will outperform
their competitors. Companies that build the very best e-business solutions will transform
themselves into zero-latency enterprises. Companies that choose not to embrace e-business, or do
so ineffectively, will underperform or be driven out of business.
Turban et al. (2012) argued that following points of managerial issues are very important: Focus
of Electronic commerce management; Sales promotion; Purchase process reengineering; Just-in –
Time delivery; new electronic intermediary business; Provision of solutions; Business ethics.
Hoque, Kamal and Chowdhury (2012) argued that a key reason why ecommerce, especially the
business-to-business segment, is growing so quickly is its significant impact on costs associated
with inventories, sales execution, procurement, intangibles like banking, and distribution costs.
Uddin and Islam (2012) observed that the multifarious projections of ICT in human life plead a
wining case for institutional integration of ICT related components in rural support programs taken
by Governments and NGOs. Chaffey (2006) dealt with strategy and applications of E-Business
and E-Commerce in a logical but robust manner. He stressed that e-business and e-commerce is
very important for management implications as such a bridge to link leading edge research and
professional practice is required.
From the aforesaid literature review, it is evident that on line banking can act as a complementary
towards e-business. With the help of e-business the country can create opportunities as this will
help both producers and customers. But these theoretical observations may not be feasible in this
country. As such the study seeks to evaluate whether the country has proper infrastructure for
doing e-business? What are the statuses of e-business in our country? Does on line transaction
really works as a complementary to e-business in Bangladesh? Aforesaid questions arises which
the study intends to examine
This report is important for further researchers in their research. I’m pretty sure that this report will
add value to the existing research. This report is prepared in a structured way and it is full of
important information.

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E-commerce Concept
E-commerce is a narrower part of e-business dealing with the purchase and sale of goods and
services over the internet, including support activities such as marketing and customer support.
The ability to made transaction for personal or professional use over the internet is known as
electronic commerce or e-commerce (Corsairs, et al., 2003). Chaffey (2007) defined e-commerce
as “The exchange of information across electronic networks, at any stage in the supply chain,
whether within an Organization, between businesses, between businesses and consumers or
between the public and private sector, whether paid or unpaid.”

Types of E-Commerce
Adam (2003) categorized e-commerce in 4 categories which are
i) Business-to-Business (B2B)
Business-to-business e-commerce deals between the businesses or among the businesses. Most of
B2B applications are used in the area of distribution management, inventory management, channel
management, supplier management and payment management.
ii) Business to-Consumer(B2C)
Business-to-Consumer ecommerce is involved between the businesses and the consumers. Most
of B2C e-commerce deals with purchasing of physical goods like books or any consumer product,
information goods like software, e-book, games, song etc., and personal finance management like
e-banking
iii) Consumer-to-Consumer (C2C)
Consumer-to-Consumer e-commerce deals between individual consumers. Online auction and
peer-to-peer system for money or file exchange could be the examples of C2C e-commerce.
Business-to-Government e-commerce is involved between the business organizations and the
government.
iv) Business-to-Government (B2G)
B2G is generally used for licensing process, public purchasing and other government operations.
Though this type of ecommerce is insignificant compare to other kind of e-commerce, but it could
be a driving force for operating public sectors which is refer as e-governance.
Other e-commerce classifications can be
i) Government-to-Business
ii) Government-to- Government
iii) Government-to-Customer

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iv) Customer-to-Business
v) Customer-to-Government and
vi)M-Commerce

Overview the E-Commerce in Bangladesh

Emergence of E-Commerce in Bangladesh: with the increasing diffusion of ICTs, more
specifically the internet, the global business community is rapidly moving towards Business-to-
Business (B2B) e-commerce. The buyers or importers gain a clear advantage when the Internet
gives them access to the global market, by which they can compare prices across regions, find out
whether prices vary by order fragmentation, get awareness about alternative products.
Consequently, the sellers or exporters make sure that they are well portrayed in the cyber world
through websites and portals. Like buyers, sellers also benefit from increased and more efficient
access to the global market through the internet. Bangladesh is pursuing an economic policy of
export-led growth. With the rising forces of globalization, it is becoming increasingly important
that the private sector, particularly the export sectors are well prepared to meet the requirements
and expectations of the importers and also stand out in the competition again exporters in other
countries. In such a scenario, two issues are becoming particularly important for Bangladeshi
export sectors- one, whether businesses are automating their internal processes with these of ICTs
to become increasingly efficient and competitive in a global context and two, whether businesses
have effective presence and participation in the cyber world. International organizations such as
UNCTAD (United Nations Center for Trade and Development) and WTO (World Trade
Organization) have emphasized on the importance of e-commerce for developing countries over
the last several years. UNCTAD has special programs to facilitate developing countries to
transition into e-commerce. The WTO has also developed rules and guidelines for global e-
commerce transactions.
E-Commerce in Different Sector in Bangladesh: Though being a under developed country,
selected segments of the Bangladeshi business community have embraced technology with
reasonable success. Personal computers and the Internet are also emerging as day-to-day business
tools. These positive indicators are favoring the prospects of e-commerce in Bangladesh. Some
sectors are given below-
➢ Ready Made Garments (RMG).
➢ Banking sectors (Online Banking).
➢ Online Shopping.
➢ Web Hosting, Domain.
➢ Online cards, gifts.
➢ Oil and Gas sector etc.
➢ Online Transportation System, Hotel Management and Tourism etc.
Telecommunication’s Role in E-Commerce of Bangladesh: E-Commerce is largely dependent
on the Internet and the access; pricing and the quality of Internet services and internet services are
significantly dependent on the status and performance of the telecommunications sector. As per

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the National Telecom Policy, 1998, the telecom sector (Fixed line, Mobile and the Internet) is
liberalized for private investment. Following the National Telecommunication Policy, the
Bangladesh Telecom Act-2001 was enacted. In order to separate the commercial operations of
Bangladesh Telegraph and Telephone Board (BTTB) from its regulatory functions, a separate
Bangladesh Telecommunication Regulatory Commission (BTRC) has been established in January
2002. Bangladesh is already connected with Information Supper High Way (I-Way / Submarine
Cable) and with the 16-party consortium of the 20000 km „South East Asia-Middle East-West
Europe (SEA-ME-WE-4) submarine cable projects as it has already installed the 1260 km branch
line cable from the landing station at Zilina in Coax’s Bazaar and at a point in the backbone of the
undersea cable in the Indian Ocean. The capacity of the undersea cable will be available in the
national network after the installation of fiber link between Coax’s Bazaar landing station and
Chittagong, which is to be completed by 2006 which connection has drastically reduce the
communication cost and ultimately the transaction cost. Last Mile connections in Bangladesh are
provided jointly by public sector and private sector. At present, in addition to the state-run BTTB‟s
Land & Cell operation, four cellular and five rural fixed lines telecom service providers 195 ISPs
and numerous cable operators are operating in rural and urban areas of the country. Key
developments of Internet service are-
➢ The focus starts to build on the country developing into „Digital Bangladesh‟ by 2021 with
this strategy providing a boost to infrastructure.
➢ Mobile internet services have been giving a much-needed boost to internet access.
➢ Provide board band services, however, continue to struggle.
➢ Rapid early growth in WiMAX services after operators launch.
➢ BTRC prepares to open market for more VoIP operator licenses.
➢ BTRC issued 34 additional IIG licenses in 2012.
➢ Banglalion and Augere were permitted to upgrade their networks to TD-LTE.etc.

E-commerce Practice in Bangladesh

E-commerce in Bangladesh actually stated in the year of 1999 based in USA with some non-
resident Bangladeshis. This people opened some Bangladeshi sites focused on providing local
news and some transactional things like sending gift items to Bangladesh. www.munshigi. com
is the first ever Bangladeshi e-commerce web site.

List of different e-commerce-type web sites

i) www.chorka.com

ii) www.hutbazar.com

iii) www.cellbazar.com

iv) www.muktabazaar.com

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v) www.bikroy.com

vi) www.banglacommerce.com

vii) www.bdjobs.com

viii)www.premium.com

ix) www.shoppingcard.com

x) www.Ecommercebank.org

xi) www.kroybikroy.com

xii) www.kholabazar.com

xiii)www.bestway.com

xiv) www.sonalibangla.com

xv) www.e-bangla.com

xvi) www.bajna.com

xvii) www.bangladeshinfo.com

xviii) www.bdbazar.com

xix) www.bdquery.com

xx) www.quickezine.com

xxi) www.Webbangladesh.com

xxii) www.deshigift.com

xxiii) www.bangla2000.com

xxiv) www.banglabaskets.com

Dimensions of E-Commerce in Bangladesh:

Internet services are presently available in Bangladesh. Its usage for e-commerce by the
Bangladeshi producers to export as well as to access inputs will be dependent on their willingness
and ability to use this medium as well as that of the buyers of final products and the sellers of
intermediate goods and services. Three dimensions of e-commerce among them Business–to-

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Consumers (B2C) is practically slightly existent in Bangladesh, while a very limited level of
Business-to-Business (B2B) and Business-to-Government(B2G) transactions exists. The potential
for use of e-commerce by Bangladeshi consumers and businesses with foreign firms is much
brighter and can play an important role in boosting the country’s exports. A significant volume of
B2G is also possible, as the government remains the biggest spender. Present Internet Situation
in Bangladesh: The internet came late to Bangladesh with the country gaining connectivity in
1996. In the last few years, it has grown considerably, although obviously from a very low base.
With an estimated internet user-base of around 10 million coming into 2013, representing just
under 7% user penetration by population, the local internet industry has been preparing to move
into the next stage of its development. As this report demonstrates, however, the country must
work hard to overcome obstacles associated with the country’s lowly economic status and still
developing ICT infrastructure, not least of which being an overly bureaucratic government. The
report also looks briefly at very early signs of broadband internet in Bangladesh and importantly,
the country’s first moves into WiMAX and mobile broadband services. The Internet was launched
by private Internet Service Providers (ISPs) in 1997. Even though NTP98 acknowledges the
critical need for easy and affordable access to Internet services, BTTB‟s pricing and regulatory
strategy on ISPs are restrictive.

Historical Background of E-commerce Organizations

a) Bdjobs.com
BdJobs.com Ltd. is the first and leading career management site in the country. Eight young
business and IT professional backed by strong command over e-business and in-depth
understanding of the needs of job seekers and employers in the country’s context started this
venture on July 2000.
Right after its launching, the site has been able to attract the Internet users in the country. The site
regularly updates Job Information (on average more than 1800 valid job news are placed at any
point of time at the site), provides facility to the job seekers for posting resume and online
application. Till now, more than 5500+ employers in the country have recruited more than 150,000
professionals at different levels for their organizations through Bdjobs.com service.
b) HutBazar.com
Hutbazar.com, a sister concern of Right IT Corporation, pioneered online comparison shopping
and today is one of the fastest growing shopping destinations for a comprehensive set of products
from thousands of trusted stores from across the Web. With a singular focus on shopping,
Hutbazar.com offers shoppers easy-to-use search tools, engaging content and time saving
navigation.
Hut Bazaar currently employees more than 1700 people around the world. Their employees work
in corporate offices, fulfillment centers, customer service centers and software development
centers across Bangladesh and many parts of Asia.

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c) Cellbazar.com
Cell bazaar is probably the safest and most convenient choice for selling and buying all across
Bangladesh. cell bazaar launched in 2006 as an innovative SMS service and its ecommerce website
has been in operation since 2007. The service allows anyone in Bangladesh to buy and sell in his
or her region conveniently in a very simple manner without registration and complicated
procedures.
It is completely free to post an ad on cell bazaar. Use of the Service beyond the scope of authorized
access approved to you by cell bazaar immediately terminates said permission or license. In order
to collect, cumulative, aggregate, copy, duplicate, display, demonstrate or make derivative use of
the website or any Content made available via this website for other purposes (including
commercial purposes) not stated herein, customers must first acquire a license or permission from
cell bazaar.
d) Chorka.com
Chorka.com is the first ever online shopping mall – an online platform facilitating Bangladeshi
brands and distributors to unwrap their outlets on the web and bring their products worldwide,
except OFAC* listed countries. Customers can purchase products using credit or debit cards (Both
International and local). Local Bangladeshi customers can opt for “Cash on Deliver” and “Account
Deposit” besides credit card purchases. Customers have the opportunity to select their preferred
delivery method and track the delivery online. Please visit our payment section for more
information.
Chorka.com is devoted for the best shopping experience through competitive price, convenience,
and timely delivery. For your security we use “Comodo SSL” which ensures transaction security
during your shopping at chorka.com.

e) Amara Networks Limited

Amara networks limited (formerly Global Online Services Limited) over the last decade has
consistently provided its customers with state-of-the-art IT communication solutions. Our clients
have been able to rely on our ability to provide stable and consistent connectivity solutions. Using
the state-of-the-art backbone and infrastructure, we have ensured that our clients have had minimal
worry when it comes to dependability of their IT Communication. That in turn has ensured us an
enviable list of blue-chip customers. When Internet and related value-added services are critical
input to business, Corporate Bangladesh has but only one obvious choice-Amara.
The company is one of the 11 concerns of Amara companies. The group has diversified investment
in ICT, Textile, and Lifestyle sectors in Bangladesh. Starting in 1985 the group presently has over
500 employees.

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Prospect of e-commerce in Bangladesh
Bangladesh has great prospect for e-commerce. At present Information Technology (IT) is a
subject of widespread interest in Bangladesh. There are around 100 software houses, 35 data entry
centers, thousands of formal and informal IT training centers and numerous computer shops. The
Government has declared IT as a thrust sector and that computer training center will be set up in
each divisional and district headquarters of Bangladesh. Import of computer hardware and
software is now duty free, VSAT is deregulated, and high speed DDN (Digital Data Network) has
been introduced. One fourth of the 45 recommendation of JRC report on software export have
already been implemented; rest is in the process of implementation. A tremendous activity is going
on in every sector including e-commerce, e-governance, computer networking, Internet, web
browsing, web applications, multimedia product development etc. Some active steps and
initiatives are already there, as described below for an exposure of the present and future prospects
of IT in Bangladesh.
Telecommunication: Bangladesh has one of the lowest Tele-density in Asia, with a mere 0.6 (in
India 1.5) lines per 100 people. In terms of phone connectivity, the charge of Bangladesh
Telephone and Telegraph Board (BTTB) is one of the highest in the world, approximately
US$300.00 (in India US$60) for normal single telephone line connection. However, there has been
significant improvement in services of telecommunication within last few years. Present
government is also trying to get additional telephone lines from a Canadian firm. If these telephone
lines are available in Bangladesh, most of the PC users will be able to use Internet and find a scope
to build up international career.
Associations and professional bodies: The associations and professional bodies who are playing
vital role to develop the IT sector in Bangladesh are as follows:
➢ Bangladesh Computer Society (BCS) was formed in 1979. This is an association of
the IT Professionals.
➢ Bangladesh Computer Samity (BCS) was formed in 1987. This is basically an
association of Computer Vendors.
➢ Bangladesh Association of Software and Information Services (BASIS) was
formed in 1998 to promote the interest of IT business, especially for software
development and related IT services.
➢ Bangladesh Software Marketing and Promotions (BSMP), a private organization,
has been formed with the view to help the local computer programmers and
promote their software.
➢ Bangladesh Computer Writers Association has been formed to promote the writers’
activities in the country.

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 ➢ Bangladesh Association for Information Technology Education (BAITE) has been
formed to promote the activities toward standardizing informal IT education in the
country.
Banks’s support: Well-trained Bangladeshi IT professionals can start their business-like Data
entry, Web development, Multimedia, ISP and Medical Data Transcription services, Cyber cafe
and IT Training Center. They can easily get financial help from bank. A number of government
banks have already started credit programs to encourage the entrepreneurs in software industry.
Some private banks are using our locally developed software too. However, due to some
constraints the outcome is not up to the expectation.
Government initiatives: The Government of Bangladesh has taken some important initiatives to
develop our IT sector. Still, we are waiting to see a fruitful change in our Information Technology.
However, some remarkable steps of government are highlighted for information.
➢ IT has been declared as a thrust sector.
➢ Quick implementation of the recommendations of JRC report (a high-powered
committee for software export).
➢ Waiving all taxes and duties from import of computer hardware and software.
➢ Hundred percent remittances of profit and capital gains for foreign investors
without any approval.
➢ BTTB’s implementation of DDN service.
➢ Decision to link Bangladesh to global highway through submarine cable link by
next two years.

Bangladesh Computer Council: Bangladesh Computer Council is the apex body of the
government dealing with Information Technology. BCC is running according to BCC Act, 1990
as an autonomous organization under the administrative control of the Ministry of Science and
Technology BCC is playing various types of roles regarding the IT booming over the country.
Human resource: Human resource is the most important component for IT industry. Bangladesh
has a huge educated, unemployed youth force with the ability to read and write English. The
country can take advantage of its immense manpower to train and prepare programmers and IT
professionals. Government has already started a project to develop Computer Programmers in
Bangladesh. All the public universities are offering one-year postgraduate diploma program for
the graduates. Our unemployed educated persons can take this opportunity to build their career as
IT professionals.
IT awareness: Young generation in Bangladesh is very enthusiastic and has correctly identified
IT as the future of the country. There are numerous computer clubs, computer festivals,
programming contests/web design contests, IT related seminars and discussions in many cities of
the country. There are about eighteen magazines and four digital IT magazines are being published
monthly and some daily newspapers publish IT pages once/twice a week. A few of the magazines
are in collaboration with other international magazines; however, most of these are Bangladeshi
origin. There are a few interactive sites and forums. A number of business centers and cyber cafes

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have started up recently. Most of these business centers provide e-mail; e-mail to fax, phone fax
services and cyber cafes offer Internet browsing.
E-commerce related activities: Recently there has been a surge in e-commerce related activities
in Bangladesh. There are e-commerce related seminars and symposiums in the country almost
every day and all the major training centers are offering courses on e-commerce. Government is
now formulating laws for e-commerce to enhance the business rapidly and smoothly.
IT Park and international market: Some private organizations have already started to work for
setting up IT Park and IT villages in the country. Some investors are foreigners and they are very
much interested to build Bangladeshi students as IT professionals. They have already started to
commission their views. Our Bangladeshi students can take this chance and hit the international
job market in the IT field. There are lot of scopes of working and entering into the international
market. Just we have to take proper initiatives. Bangladeshi IT professionals have a good demand
in international IT job market, which has been proved by some of our BUET students.

Potential Opportunity Of E-Business in Bangladesh

However, Bangladesh is a developing and over populated country, that has high potentiality for
the successful implementation of e-business. It exports a significant number of foods, non-foods
and garment products to overseas. It can expect an attractive intrusion of e-commerce technology.
Having performed reasonably well in almost all leading businesses and the industrial sector in the
current decade, Bangladesh, unfortunately, has not yet performed satisfactorily in the field of
online trading and e-commerce. Many companies have established their own websites but there is
a much difference in launching a website and doing business online through web. Most of the
businesspersons of our country do not use Internet very much for commercial purposes (Usman,
2011).
Capital Markets: The capital markets became volatile from the second half of FY2010-11.
During the period, the DSE general index increased by 98.43 percent from 3,010.26 to 6,153.68
indicating keen interests showed by the investors in the capital market. Similarly, market
capitalization stood at 44.1 percent of GDP at that time. (Bangladesh Economic Review-2011) As
the people are some extent market-oriented introduction of new and different e-commerce
procedure may boost up our economy through e-business.
E-Tourism: The tourism industry at first focused on utilizing computerized systems (e.g., CRS,
GDS) to increase efficiency in processing of internal information and managing distribution. E-
tourism reflects the digitalization of all processes and value chains in the tourism, travel,
hospitality and catering industries. At the tactical level, it includes e-commerce and applies ICTs
for maximizing the efficiency and effectiveness of the tourism organization
Export Sector: With the recovery of global economy from recession, Bangladesh’s export trade
has been performing better. Export recorded a robust growth of 41.47 percent in FY2010-11, as
against 4.11 percent during the previous fiscal year (Bangladesh Economic Review-2011).

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Exporting of electronic equipment and technological software contributes in our economy. So, it
is necessary to develop e-business Park to ensure the economic growth.
Expatriate Employment and Remittances: The slowdown in the growth of remittance reflected
the impact of global recession, particularly on the real estate markets in the Middle East, and on
industrial labor demand in some South East Asian economies such as Malaysia. Despite the
recovery, the recent political turmoil in North Africa and Middle East negatively affects the
expatriate employment. Foreign markets always seek the expatriate of ICT. People having the
knowledge of technology and internet always have the opportunity to participate in economy by
brain draining to other country. Govt. needs to initiate computer and technology courses
compulsory in education.
Banking Sector: Although all commercial banks have started following automation system,
online banking system through ATM, local credit cards, online service, automation payment and
EFT is available in the selected area only. So in the banking sector e-business can make more
contribution. Entertainment business based on Internet is not available in Bangladesh till now.
Web radio and TV may offer a new way for delivering services to the customers. Recently, Internet
radio is available but they are not familiar to the masses and thus lose the opportunity to do
business.
Special Economic Zones: EPZ is triggering the economic growth; govt. needs to take the steps to
make the operational activities through internet. If EPZ is fully digitized and e-procurement is
ensured then the supply of the goods can be done without delay.
Health Sector: Different hospitals and clinics can provide online medical services by their best
medical officers and doctors at fees that are paid in online. On line reservation of different hospitals
needs to ensure for proper service.
Music Industry Sector: There are only a few online music shops in Bangladesh who sell music,
videos. In this sector there is great chance to introduce e-business technology. By using this
technology, people can buy music, videos at their convenience using credit card and online
payment.
Publications Sector: Education sector in Bangladesh is advancing with the passage of time. If
books are digitized student can buy them using internet at lowest possible prices using credit card.
Publication of different books and article is now easy for the publisher because of the advancement
of e-business.
Agriculture Sector: Agriculture sector plays an important role in the overall economic
development of Bangladesh and it is regarded as the lifeline of Bangladesh economy. It is also an
important social sector concerned with issues like food and nutritional security, income generation,
and poverty reduction. The contribution of agriculture sector in GDP stood at 20.29 percent in FY
2009-10. Agricultural sector needs to make strong by developing web sites enriched with different
process, systems, and particulars of agricultural products. Ordering of ago product through e-mail
will make the transaction faster and importer can give the order to the middlemen immediately.
So, it is necessary to ensure ecommerce through the whole country for our economic growth.

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 Industry Sector: Rapid and sustainable development and social progress essentially call for
industrialization in an economy. Industrial sector needs to be properly web based and internet
based then the business will grow rapidly. The industry sector has, therefore, got to play a critical
role in this regard. The contribution of this important sector to Bangladesh economy has been on
the increase.
Telecommunications Sector: Telecommunication sector is an attractive sector in Bangladesh.
About 4 crore people in this country are using mobile phones. As a result if e-commerce services
are introduced in large scale there will be a significant growth.

Constrains of E-commerce implementation in Bangladesh

Bangladesh’s Public power sector is inadequate. Overloading and lack of maintenance cause
frequent outages and necessary planned blackouts. How can a country like this be able to provide
E-commerce, when the main component, “e,” is never there? The Country’s telecommunications
services are inadequate. 60% of the lines are analog, and the quality of the service is poor; there is
a 30% connectivity rate. The followings are the obstacles in e-commerce implementation:
i) Bangladesh’s Public power sector is inadequate. Overloading and lack of maintenance cause
frequent outages and necessary planned blackouts. How can a country like this be able to provide
E-commerce, when the main component, “e,” is never there!
ii) The Country’s telecommunications services are inadequate. 60% of the lines are analog, and
the quality of the service is poor; there is a 30% connectivity rate.
iii) Lack of e-commerce sites in their countries that offer affordable and appropriate services,
especially those with a “development-friendly” image;
iv) Difficulty of obtaining merchant accounts with e-commerce service providers, even where
these exist;
v) Lack of appropriate commercial know-how and technical skills to go about setting up e-
commerce activities;
vi) Absence of a peer group to share experiences and develop strategies and solutions for their
special brand of e-commerce, since this is such a new activity.
vii) The Internet and e-commerce is a global phenomenon, so therefore it behooves the region to
adopt international standards.
viii) Lack of appropriate trainers to teach the E-commerce Knowledge.
ix) Lack of Government’s rules and regulation.
x) Bangladeshi’s Policy for e-commerce is not adequate for good result

Overcome of E-commerce implementation in Bangladesh

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Our Bangladeshi students should be more aware about Information Technology and they should
take proper decision to build their career. It will be only possible when there will be political
commitment with better IT infrastructure, internal network, country domain and above all a high-
speed fiber optic link to the Information Superhighway. The presence of the following pre-
conditions is inevitable successful e-commerce implementation:
Human Resource Development
i) IT training
IT training, including computer literacy rate, in Bangladesh is relatively Poor due to insufficient
facilities in both the private and public sector. IT training needs to be substantially encouraged in
the nation through formal and informal means.
ii) Establish IT University
An institute of higher learning, solely dedicated to the IT Discipline needs to be established
offering graduate and postgraduate degree programs in IT related areas.
iii)Harmonize standards for training institutes
As a result of expanded interest in the IT field, numerous institutes have been established by the
private sector. To ensure standard and quality of IT education steps need to be taken to monitor,
evaluate and certify the training being imparted by these institutes.
iv) Larger access to computers/internet through cyber cafes
Accessibility to Internet, and computers in general, is not available for to a majority of the
population. This is particularly true for people not living in major cities such as Dhaka and
Chittagong. Government and Private initiatives need to be realized and encouraged to establish
cyber cafes and similar environments to provide wider access to the computers and Internet.
Financial System
i) Computerization
Financial systems, which are currently highly hardcopy-based, should be encouraged to become a
“paperless” environment through wide scale computerization.
ii)Electronic L/C
Electronic Letters of Credits (L/Cs) should be accepted as legal documents.
iii)Problems of telecommunication line
The financial sector is highly dependent on the quantity and quality of lines of communication.
Special attention needs to be given to resolve the telecommunication needs of the financial sector.
iv)Domestic clearing
Domestic clearing of financial instruments needs to be encouraged and substantially improved.

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v) Foreign exchange credit cards
The control of foreign exchange should be liberalized gradually, starting with the FC inflows, and
issuance of Internationally honored credit cards should be allowed. Maximum limits on credit
cards should be further liberalized, but can also be reviewed to preclude flight of capital.
vi)Venture funds
Formation of venture funds, as well as non-collateral-based loans to support the IT sector should
be encouraged.
vii) International gateway
An international gateway to support the financial sector should be established.
viii)Foreign exchange limits/export definitions to be revised for export sales through E-
commerce
Accessibility of the private sector to the foreign exchange earned through exports should be
reviewed and liberalized. Definition of “exports” needs to be broadened to include exports through
non-traditional means, such as e-commerce, for them to utilize the benefits granted to exporting
companies (as in EPZs).
Telecommunications
i)International broadband under Ministry of Post & Telecommunication
Ministry of Post and Telecommunication controls the entire outside plant (OSP) or cabling
network, which is exclusively copper-based. Bandwidth limitation remains a chronic ailment to
the customer and steps need to take to increase accessibility to wider international bandwidth.
ii) Privatize Telecommunication and Telegraph
Steps need to be taken to privatize BTTB. Private sector should be encouraged to provide basic
telephony nationwide.
iii)Independent Regulatory Authority for telecommunication
Bangladesh Telecommunications Regulatory Commission (BTRC) should be allowed to operate
independent of government influence and control.
iv) Open telecommunication market to new investment
Allow the private sector, national and international, to invest in the telecommunications sector.
v)Resell restrictions to be lifted on Grameen Fiber Optic for data transmission
The provision of obtaining permission from MOPT prior to leasing the capacity from Grameen
Phone’s optical fiber network should be abolished, particularly when the usage is for the
transmission of data.
vi)Legalize Voice Over Internet Protocol (VOIP)

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VOIP enables bypassing expensive traditional telephony and helps the user utilizes the full benefits
of Internet connectivity.

SWOT Analysis
To find out the viability of a particular product we must perform a SWOT Analysis of the product.
This will analyze the Strengths, Weaknesses, Opportunities, and Threats of the particular product.
For analyzing the performance of e-commerce in Bangladesh, the following SWOT Analysis is
considered.

Strengths

• E-commerce is new in our market. Only a few organizations are now offering internet
services in solving transaction problems. Most of the companies are offering only
accounting information online. Actual payment and delivery procedure is not possible in
all the organizations that are offering internet services. So, this product will enjoy the
benefit of a first mover.
• It is cheap both for the companies and the customers. The companies will be able to lower
down the overhead costs and make more profit out of it. E-commerce will require fewer
manual workers. Again, the customers will be able to save time as well as money for their
transaction needs.
• E-commerce is convenient as the service is available all the time at just a click away.

Weaknesses

• Security breakdown: The system will have a problem with the identification of the
individual who is initiating the transaction. In Bangladesh, the identification of an
individual is not yet supported digitally. So, there will be a problem in moving to the
Internet era for business purposes just now. First, we will have to develop a digital database
of the users of the internet business services.
• Transaction can be cancelled only via internet. The internet infrastructure of our country is
not that much supportive to provide all time access to the web. So, there will be a problem
in executing the service with its full functionality.

Opportunities

• Non- branch business is becoming popular in our country. Many e-based companies are
now trying to offer non-branch business facilities. A person can withdraw or deposit money
in any branch of the organization he has a membership with them. So, moving to internet
business will allow the companies to offer non-branch business facilities.
• The internet services are becoming very common to us. So, a service offered through the
internet will be widely accepted in the near future.

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Threats

• People have concern about security and privacy. They like to feel their money with their
hand. They actually don’t believe in virtual money transfer.
• In the field of IT new technology is coming every day. The one which is very popular today
might get obsolete tomorrow. So, to have a competitive edge over the competitors the
banks must always update their services.
• The movement towards online business might marginalized the customers who do not have
internet access or who are not technologically sound.

Despite the presence of online Internet service in Bangladesh, its scope is largely underutilized.
The reasons include high service charges, lack of awareness, poor telecommunication systems,
government policy, low buying power of potential clients, and lack of institutional support.

Significance
Despite being a poor country, selected segments of the Bangladeshi business community have
embraced technology with reasonable success. The Facsimile in the 1980‟s and mobile telephones
in the 1990‟s popularized modern technology in the mass market. Personal computers and the
Internet are also emerging as day-to-day business tools. These positive indicators are favoring the
prospects of e-commerce in Bangladesh.

The focus of this paper was on the current state of the regulatory environment in the financial and
technological sectors of Bangladesh. Necessary reforms in order to introduce e-commerce have
also been suggested. Lack of awareness among the policymakers has been identified as the major
deterrent to introducing e-commerce. Conventional understanding of payment mechanisms raises
false alarms against the flight of capital if e-commerce is implemented.

Synergy between telecommunications and information technology has the proven capability of
monitoring and administering the real-time transactions. Therefore, liberalizing the telecom and
IT sectors as well as reforming the country’s financial and commercial procedures is the
preconditions of successfully implementing ecommerce in Bangladesh.

Limitations
Although the study will address numerous benefits, explores the state of perceptions of different
business organizational categories, it is still unanswered that which of the benefits significantly
affect, and in what extent, the intention of the adoption of e-commerce, may be considered as the
limitation of the study.

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Recommendations
The followings are some of the recommendations that will ensure the smooth functioning as well
as the wide spread use of e-commerce in Bangladesh.

• Bangladesh Telecommunications Regulatory Commission (BTRC) should be established

independent of the government control.
• Voice over Internet Protocol (VoIP) and private international gateway for voice and data
should be allowed.
• The number of pre-shipment agents (PSI) should be increased. The size of fines and
penalties on PSIs should be increased for breach of rules and regulations.
• Posting of government documents and publications including budgetary information on the
Web should be instructed.
• Contracts and other alternates to Letter-of-Credit (L/C) should be allowed as legal methods
for international transactions.
• Foreign exchange controls on travel and for business should be relaxed.
• BTTB‟s monopoly in the nationwide long-distance services should be ended.
• The control of foreign exchange should be liberalized gradually, and issuance of
International Credit Cards should be allowed.
• Government officials are to be oriented on the benefits of e-commerce. For instance, short
course can be offered at training centers such as the Public Administration Training Center
(PATC).
• Business associations and organizations should be made aware of the benefits of e-
commerce. BGMEA can play a significant role in this.
• Greater competition among the Internet Service Providers (ISPs) should be promoted and
new ISPs should be encouraged to come into business.
• Revise and update ageing laws on trademark, copyrights and evidence.
• Court procedures should be simplified and expedited. Administrative and institutional
constraints in settling disputes should be removed.

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References
➢ Tkaczyk, Weariest; Kaczynski, Adrian, Springer, 2009, 255.
➢ Miller, Holmes E. and Engelmann, Kurt J., A methodology for managing information-
based risk, Information Resources Management Journal,9(2), 17-24.
➢ Introduction to E-commerce, Available:
www.pearsonhighered.com/samplechapter/0131735160.pdf
➢ Forecast for Global Ecommerce: Growth, Available: www.captureecommerce.com
➢ Mann, Catherine L., Sue E. Eckert and Sarah Cleland Knight, A Policy Primer: Global
Electronic Commerce, Institute for International Economics, Washington DC, 2000.
➢ Ministry of Commerce, Government of Bangladesh, Trade policy Review, April 2000,
Dhaka, 2000.
➢ Ministry of Commerce, Government of Bangladesh, Report on Export of Computer
Software from Bangladesh: Problems and Prospects, Dhaka, 1997.
➢ Nazmul Hossain, E-commerce in Bangladesh: Status, Potential and Constraints,
December 2000.

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