Nepal's future looks bright but not without challenges

KATHMANDU, JAN 02 -

 

Who would have imagined a decade ago that one could book air or movie tickets from a mobile phone ? Who would have thought migrant Nepali workers could send remittance on a phone ?

All this, and much more has happened in last one decade, thanks to the advancement in the domestic information and communication technology (ICT) sector. Digitisation of the economy is under way.

 

However, Nepal still has miles to go. It is at the 137th position (2012) in the ICT Development Index, as per the International Telecommunications Union, a UN body for global telecommunication matters. It clearly shows no matter how much advancement Nepal has made in the ICT sector, other economies are advancing at a faster pace. 

 

The progress made so far has been driven by the private sector. Despite being located between two fast growing economies—India and China—Nepal has failed to take advantage. The northern neighbour, China, dominates the global ICT hardware trade, while the southern neighbour, India, is known for software development and is known as one of the best destinations for business process outsourcing (BPO). 

 

“Compared to hardware, we can do far better in BPO and software development, mainly for clients looking for a cheaper labour destination,” says Binod Dhakal, president of the Computer Association of Nepal (CAN). “In the case of utilising ICT for development, the country is yet to exploit its true potential.” 

 

According to a study carried out by the CAN, the Nepali IT industry was worth $42 million in 2008, with an average annual growth rate of 8 percent. 

 

There is no any exact data on the size of investment and IT sector’s contribution to the economy, but based on the CAN study, it can be estimated that the IT industry has an estimated turnover over $110 million now, including hardware/software trading and BPO exports. 

 

Progress and Potential

ICT has become an integral part of one’s daily life. And, it is not only the private sector that is going hi-tech, but also the government is gradually adopting online service delivery systems. Some examples include online company registration launched by the Company Registrar Office, use of ICT in the issuance of voter ID cards and recording their data during the Constituent Assembly elections, and adoption of e-tendering.

 

 The Ministry of Information and Communications has formed a taskforce to carry out a feasibility study to develop the country as a free WiFi zone. The panel under the coordination of Mahesh Prasad Adhikari, board member of the Nepal Telecommunications Authority, has been given 30 days to complete the study. It will suggest the government on funding and technical requirements for the scheme. 

 

Also, under its ICT Development Project, the Department of Transport Management is gearing up to implement electronic driving licence and blue book system. 

 

Basically, the local market is considered as the consumer of services produced in the international market. But this notion is changing. Innovative services like CahOnAd (smart phone application) have been successful in attracting global attention, while a number of BPO firms have successfully attract businesses from developed economies like the United States, the United Kingdom, Australia and Japan. 

 

With the entry of the private sector operators a decade ago, the domestic telecommunication market has grown notably. Mobile telecom service, which used to be considered luxury until a decade ago, has now become a necessity. Moreover, the convergence in technology has helped use mobile devices for multiple services like mobile banking and payments.

 

In the local context, this has become possible due to a significant rise in the number of smart phone and data users, according to Bhesh Raj Kanel, former chairman of the Nepal Telecommunications Authority (NTA). As of October 2013, mobile phone penetration rate of the country has increased to 72 percent. 

 

Development of innovative mobile applications within the country suggests how big the potential of mobile technology is. Although the local market is far behind in the hardware segment, in terms of BPO, software and mobile applications, it holds huge possibilities. 

 

About four months ago, CashOnAd was launched, raising eyebrows of not only domestic but also international marketers. The smart phone application has revolutionised market segmentation and targeting. CashOnAd has so far recorded 90,000 downloads. What is more interesting is the application offers Rs 1 for watching a commercial that plays on the smart phone screen every time a call rings.

 

The developer has said it will take the product to the global market by this year. “We are targeting to reach around 70 countries and record 5 million downloads within 2014,” said Biswas Dhakal, president of CashOnAd.

 

Domestic IT forms, which mostly focused on outsourcing, have started to get demands from the domestic market as well, especially for smart phone applications. For an instance, BrainDigit IT Solution, which was originally started as a BPO in 2007, now also serves the domestic market. “BPO is just another business for us as we have started focusing on the local market as well,” said Nitesh Gorkhalai, business development director of the company. He said the company is set to launch two new concepts on product and service promotion—Predicting Game and Ramailo Mart.

 

The progress in the overall ICT in the country is mainly driven by the private sector, while the government has not been able to catch up with the trend. Even as the government adopted e-governance concept in 2006, the results so far have been negligible even as the time has come to move from e-governance to m-governance.

 

 IT Park in Banepa built around a decade ago has failed to yield desired fruit. “The sector is one of the most neglected one by the government,” said Biplov Man Singh, chairman of the ICT Development Committee of the Federation of Nepalese Chambers of Commerce and Industry. 

Given the potential in the BPO sector, Singh said the government should first encourage local firms by giving incentives like tax waivers and addressing problems like load-shedding. 

 

Although the majority of BPO firms are yet come under the government record, it is estimated they export services worth $50 million (Rs 5 billion) annually, according the CAN. 

A study carried out by the then High Level Commission for Information Technology in 2004, BPO exports stood at $7.2 million annually, with an average annual growth rate of 20 percent. 

 

Currently, the global outsourcing market is worth over $90 billion, with Indian and the Philippines being the major BPO hubs, according to media reports. 

 

Since Nepal’s workforce is cheaper, the BPO sector has a huge potential for earning foreign currency and generating employment.  

 

There are an estimated 200 firms involved in the BPO sector. However, around only a dozen are visible in market. Also, hardly 50 such firms are registered with the government authorities concerned. 

 

Although the CAN annually organises SoftTech, an event to promote BPO firms and software developers, participation is very low, says CAN President Dhakal. 

 

Even as the government has listed BPO and software as exportable items, both the government and the private sector have failed to promote the country among global clients. Last year, the government had assured of bringing a separate policy to help promote the BPO sector. But the despite formation of the IT Council headed by the Prime Minister and a separate IT Department under the Ministry of Science, Technology and Environment, no progress has been made on this front.

 

CAN President Dhakal said the government has failed to abide by its own policy. “The policy is perfect, but there is no action plan to move ahead,” he said. 

 

Be it finance, health or education, every sector is related to IT one way or the other. At the same time, technology is changing every day. To catch up with the fast changing trend and capitalise on its potentials, the authorities concerned have to be more proactive and change the rules and regulation accordingly. In Nepal, ICT issues are looked after by agencies like Ministry of Science, Technology and Environment, Ministry of Information and Communications and the NTA. 

 

Sudhir Parajuli, CEO of Subisu Cable Net, said convergence in technology has made it possible to provide data, voice and video services from a single cable. “But we are required to take separate licence for all these services,” he said.  His company is providing cable TV service and internet service from the same cable, but has acquired two separate licences.

 

There is still confusion regarding the jurisdiction of the Communications Ministry and the Technology Ministry. The IT Department is under the Technology Ministry, but areas like voice and data service and IP TV falls under the sector is being governed by the Communications Ministry. 

In a bid to formulate policies, the IT Council was formed but it too has failed to accord priority to the sector. “HLCIT was at least trying to move gradually building local and international relations,” says Dhakal, adding the policy-level confusion and the government’s negligence has badly affected the sector.

 

Source: ekantipur.com, 2nd Jan 2014

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Mobile Devices have high demand in Nepal

KATHMANDU, JAN 02 -

Information and Communica -tion Technology (ICT) products, which used to be considered luxury a few years ago, have now become an integral part of our working and living environments.
The hardware market, which was limited to the personal computers and certain utility accessories, has been taken over by portable wireless devices with multiple functions.

First it was personal computers (desktop) which took the market by storm. Then came laptops enhanced with portability and flexibility. With the advancement in mobile communication and availability internet on-the-go, tablets and other mobile devices are now threatening laptops, globally.
Even in the domestic market, the demand for tablet computers has grown significantly. Features like removable keyboards, high-resolution screens and memory on par with laptops, portability, ease of use, gaming, and other features similar to smartphones have helped attract customers.

Traders say the increasing demand for the wireless portable devices in Nepal is driven by the fact that they offer longer battery backup. “Due to this reason, the demand, mainly laptops and tablets, has jumped multifold,” said Binil Bajracharya, general manager of Nepa Hima Trade Link.

Amulya Gurung, marketing manager of Nagmani International, said desktops are still in demand from business users. He said people who want to do office work “comfortably” still consider desktops. “However, laptops and tablets are gaining popularity, mainly among individual users, as they offer longer battery backup,” said Gurung, adding the latest tablets run for up 14 hours on a single charge. Nagmani International sells desktops, laptops, NAS (a server device) and other ICT accessories from global brands including Asus, Transcend, HP and Asustor.

The latest from the Asus stable the company is selling is an all-in-one touch-screen laptop.
The company is launching Asus Vibo Book at the CAN Info-Tech being held from January 2-7. The product features a touch-screen and is powered by fourth generation Intel Core i7 processor.
The company is also featuring on-to-go (OTG) pen drive at the exhibition. Gurung said the 8- GB pen drive will allow accessing the stored data directly on smartphones.

Besides laptops and tablets, traders are also offering the latest networking-related products. These include the optical fibre, video converter and routers, among others. Arun Bansal, chairman of Hi-Tech Engineering, said the market for networking-related products is expanding with the rise in the number of users. Hi-Tech sells Digicom branded broadband and ADSL routers.

At CAN Info-Tech, Hi-Tech is showcasing routers in the Digicom Zing series. Bansal said the new product, developed using next generation central processing unit, ensures high-speed internet. He said the product will be available in 150- and 300-mbps variants.

Apart from products from the existing brands, traders are also launching new brands. Sagar Group will be showcasing new smartphones and tablets from a European brand. According to an official of the company, it will open bookings for the products during the expo.

 The 20th CAN Info-Tech, aimed at promoting ICT-related products and services,
features 221 stalls. CAN General Secretary Amrit Pant said the exhibition will focus on promoting ICT products as one of the fundamental needs of the people.

Source:ekantipur.com, 2nd Jan 2014
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New Gadgets to be Launched in Nepal in 2014

KATHMANDU , JAN 01 -

With the year 2013 making shift to 2014, several gadget companies are lined up for new launches of the latest innovative products to woo prospective buyers. Local distributors of smartphones, tablets, phablets and ultra books, among others, are all set to introduce various new products in 2014. Here is the low down on some of the gadgets

Asus Vivobook S451LB & Vivobook S 551 LB

Nagmani International, authorised distributor of Asus products in Nepal, will be launching a new model of Ultra Book—Asus Vivo Book S451LB—at CAN Inchfo Techon January 2. The Ultra Book which comes with full metal body and touch screen features fourth generation core i5 processor, 4 GB RAM, 2 GB graphics Nvidia 740M and 500 GB hard drive. Amit Sharaf, director at Nagmani Inchternational, said that the new device looks attractive as it has a full metal body that will also protect the device from physical damages. He also claimed that it will be the first 14-inch Ultrabook with touchscreen and DVD-RW in the domestic market. The company has fixed the price for this Ultrabook at Rs 102,900. The company will also be launching Vivobook S 551 LB under the ultra book series. The 15-inch Ultra-book features fourth generation core i7 processor, 8 GB RAM, 1 TB hard drive with full metal body. The device is priced Rs 106,900.

Colors X Factor Tab

TeleTalk Nepal, authorised distributor of Colors mobile and tablets in the domestic market, will introduce X Factor tab with Quad Core processor by February 2014. Sachin Udas, marketing head of the company, said that this model armed with a very fast processor will offer a rich gaming experience in the tablet sector. The tablet comes with 1.2 GHz Quad processor, 1 GB RAM and 8 GB internal memory. The company said the tablet will cost approximately Rs 18,000. Similarly, the company will also introduce upgraded version of Colors Pearl Black series with Octa Core processor which features 2 GB RAM, full HD graphics. This smart phone has 13 mega-pixel rear and 5 mega-pixel front facing cameras. It is priced at around Rs 36,000.

Nokia Lumia 1520  

Neoteric Nepal, authorised distributor of Nokia products, is all set to launch Nokia 1520 fablet in the domestic market by mid-January 2014. Aayush Shrestha, the company’s marketing manager, said that this advanced model of fablet among the devices running on the Windows platform. It features the biggest screen of six inch, high resolution at 1080P which comes with the fastest processor Qualcomm’s Snapdragon 800 of 2.2 GHz and 20 mega-pixel camera.

Samsung Grand 2

International Marketing Services, authorised distributor of Samsung mobiles in Nepal, has said that it will introduce Samsung Grand 2 by the mid-January 2014. The phone comes with 5.25 HD screen, Quard Core 1.2 GHz processor, 1.5 GB RAM and 8 GB internal memory which is expandable up to 64 GB . With the latest Android OS v4.3 Jelly Bean operating system, the device features 8 mega-pixel rear and 1.3 mega-pixel front cameras. Geo tagging, face and smile detection, image stablisation and touch focus among other features.

LG G Pro Lite and G2  

The sole authorised distributor of LG electronics in Nepal, CG Electronics, is set to introduce LG G Pro Light within January. Ramesh Shrestha, General Manager of CG Electronics, said that the new device will treat gadget lovers with latest features. The G Pro Lite comes with features such as 5.5 inch IPS LCD capacitive touchscreen with multi-touch function and runs on Android v4.1.2 Jelly bean operating system. It has got 8 mega-pixel rear camera and 1.3 mega pixel front facing camera. The other device G2 too runs on the same platform and boasts features such as 5.2 inch LCD capacitive touchscreen with multi-touch function and corning gorilla glass 2. G Po Lite is expected to cost around Rs 36,000 and G2 at Rs 80,000.

Source:ekantipur.com, Jan 1st 2014
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Business Process Outsourcing yet to be fully exploited in Nepal

KATHMANDU, JAN 02 -

 

Business process outsourcing ( BPO ) is not new in Nepal. It’s been almost a decade since the domestic IT sector saw the emergence of BPO firms.

Since then, the sector is growing, albeit slowly. Although exact data is hard to find, it is estimated there are over 200 large and small BPO companies operating in Nepal, offering employment to more than 3,000 individuals.

 

GeoSpatial Systems, Serving Minds, Yomari Inc and D2Hawkeye (now known as Verisk Information Technologies) are the pioneers when it comes to establishing the BPO business in Nepal. 

Now, Verisk Information Technologies, DeerWalk Services and BrainDigit IT Solutions are known as the leading players in domestic BPO sector.

 

Industry insiders say some of these BPO companies’ have a “huge” annual turnover. According to CP Adhikari, coordinator of the Software and BPO Sub-committee at Computer Association of Nepal (CAN), the sector is estimated to have an annual turnaround of more than Rs 5 billion.

Analysts forecast the global BPO market will be worth $93.4 billion in 2015, up from $71.92 billion in 2010, with India, China and the Philippines being the leading BPO hubs.

 

Although software outsourcing has become a substantial sector by now, the failure of the government to recognise this sector 

has caused a big loss for the economy. 

 

“The government seems more focused on the exports of products. If the government succeeds in recognising the software outsourcing business, it might turn into one of the best exportable items for the country,” said CAN President Binod Dhakal.

 

Those involved in the business say software outsourcing is still at nascent stage in Nepal compared to countries like India, China, the Philippines and Costa Rica. But the competition has already intensified within the country among the outsourcers. Brajesh Nepal, chief executive officer of Media Guru, said there are many professionals who silently operate as an outsourcing company limiting themselves to four walls. “Since this job is done purely through the internet, there are companies which prefer silence,” said Nepal.

 

Though the outsourcing business has a huge scope, Nepali professionals are mostly focusing on outsourcing websites, HR-related software, SMS gateways and mobile phone applications, among others. There are also exceptions, however. A few companies have managed to serve the likes of Disney and Windows, among others.

 

The outsourcing sector has also turned into one of the best for jobs. Starting from Rs 15,000 for starters, there are young managers who draw Rs 150,000-200,000 a month. “There are examples of a 20-year-old fetching up to Rs 150,000 a month which is huge compared to what even best of the corporate offices in the country offer,” said Pradeep Timilsina, senior system engineer at Syntegrate, a software outsourcing firm.

 

Mostly, software outsourcing firms are paid on hourly, monthly or project basis, and the pay starts from $10-15 per hour and goes beyond $5,000 per project, depending on the nature of the project. 

What makes the outsourcing business lucrative business in Nepal is the fact that international companies can save up to 70 percent of labour costs compared to their home countries. 

“If an American company develops software in its own country, the cost of production will be much higher as compared to Nepal,” said Nepal, adding countries like Vietnam, Cambodia, the Philippines, Myanmar and China have hugely benefited from software outsourcing, and even Nepal too can benefit from it, but a serious government effort is needed. 

 

Despite the industry coming to a substantial position on its own, the lack of a government policy has prevented the sector from getting the required exposure. “A huge chunk of money is getting unaccounted due to the absence of a policy,” said Nepal, adding the government should try to incorporate the sector in legal books with appropriate incentives.

 

One of the professionals seeking anonymity told the Post that numerous companies in Nepal are operating by getting registered as Indian companies. “Since it is easy to get big projects if established as an Indian company, there are many who are doing so,” the professional said, adding the trust factor is there, but the lack of a proper legal framework in Nepal is also prompting professionals to register their companies in India.

 

Biplov Man Singh, chairperson of the ICT Development Committee at the Federation of Nepalese Chamber of Commerce and Industry (FNCCI), said the government should come up with schemes to bring out these companies locked within four walls. 

 

 “Like in India, the government can bring down corporate tax for such companies to zero percent and only charge income tax for around five years,” said Shakya, adding this will help expose hidden companies.

 

Source: ekantipur.com, 2nd Jan 2014

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Service Sector is Highest Tax payer in Nepal

KATHMANDU, Dec 31: Nepal Telecom (NT) became the largest contributor to income tax in fiscal year 2011/12, paying Rs 6,015 million. Given the sluggish performance of the manufacturing sector, the service sector has dominated the top-10 list of largest contributors to income tax, according to a confidential source.

Ncell-- a multinational telecom firm--became the second largest income tax contributor, paying Rs 4,970 million. The Agricultural Development Bank Ltd ( ADBL) is the largest bank and third largest company, and it paid Rs 1,656.7 million in income tax during the year.

Surya Nepal --an Indo-Nepal-UK joint venture and subsidiary of ITC Ltd--has emerged the fourth largest contribution to income tax, paying Rs 1,654.4 million.
Surya Nepal is involved in manufacturing and marketing cigarettes as well as readymade garments in Nepal, besides exporting the apparel.
At a time when the country is facing a yawning trade deficit and a slowing manufacturing sector, Surya Nepal became the largest manufacturing industry. The fifth to 10th positions have been secured by commercial banks.

Foreign joint ventures Nabil Bank-- the first foreign joint venture bank in the country, Nepal Investment Bank and Himalayan Bank secured fifth, sixth and seventh positions, contributing Rs 1,150 million, Rs 1,050 million and Rs 847.2 million respectively. Two other joint venture commercial banks--Everest Bank and Standard Chartered -- are eighth and ninth ranking contributors, paying income tax of Rs 847 million and Rs 730 million respectively.

State-owned commercial bank Rastriya Banijya Bank stood in 10th position, paying income tax amounting to Rs 620 million.
As per existing law, banks, corporate houses and industrial entities have to pay 30 percent, 25 percent and 20 percent respectively of their profits as income tax. Only Surya Nepal--the sole firm from the manufacturing sector--being included in the top income tax-payer list, highlights the weak contribution of this sector to the national coffers.

Data compiled by the Central Bureau of Statistics (CBS) shows the growth of the manufacturing sector limited to 3 percent in 2010, 4.1 percent in 2011, 3.6 percent in 2012 and a projected at 1.8 percent for 2013.

With the manufacturing sector slowing down consistently, its contribution to Nepal´s gross domestic product (GDP) has been hovering between 6.7 percent and 6.9 percent over the last five years.

However, the service sector´s contribution to GDP stood at 49.5 percent during both fiscal years 2011 and 2012, while 50.6 percent contribution is projected for 2013. “Significant reforms in policies effected in the service sector over two decades are the major factor behind the mammoth growth of this sector and its contribution to national revenue,” Dr Chiranjibi Nepal, Chief Economic Advisor of the Ministry of Finance, told Republica on Tuesday. Contribution of the service sector in the global economy hovers around 70 percent.

Source: myrepublica.com, 31st Dec 2013
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Massive rise in Business for Multiplexes in Nepal

KATHMANDU, Dec 30: The state-of-the art cinema halls are turning into the most appealing destination for moviegoers in recent years.

The main reason for the attraction is the location of the multiplexes: in the shopping malls.

 The multiplex business that began with Jai Nepal a decade ago has leaped forward to a new height with QFX Cinemas, Big Movies, and more recent FCube Cinemas.
The improvement in technology has revolutionized the movie-viewing experience. Around 30 to 40 million rupees are invested per theater in a multiplex in QFX.

“We have introduced European sound technology and the 2K projector which has given a whole new experience to the audiences that they couldn´t experience in the single screens,” said Basanta Manandhar, distributor manager QFX.

QFX cinemas that includes three multiplexes -- Jai Nepal, Kumari and QFX Central at Civil Mall sees 90 to 100 percent occupancy on weekends and around 50 to 60 percent occupancy on weekdays. There are 930 seats at QFX Central, 475 at Jai Nepal and 543 seats at Kumari.

The QFX team is also planning to expand to Lalitpur Bishal Bazar in Lalitpur. It also plans to reach outside the valley in future in urban areas of Pokhara and Birtatnagar.
“The package of state-of-the-art cinema halls, shopping malls and food court is adding great value to the family audiences. The comfort level and security that multiplexes provide is way better than a single screen” said Manandhar.

“The major audiences of the multiplexes are school and college going youngsters. However, on the onset of festive seasons and holidays, family audiences and the working class also throng the multiplexes,” said Rakesh Shrestha, operation manager of Big Movies.

Big Movies have invested over Rs 100 million on its 875-seat multiplex at the City Center, Kamal Pokhari. According to Shrestha, due to the availability of different facilities like gaming zones, shopping outlets, café and cinema hall all in one place, the multiplex business has blossomed in the capital.

As the market grows, it has also reduced the ticket price recently by up to 10 percent in order to make the prices suitable for all classes.
Big Movies also plan to add its customer service by improving online ticketing facilities.

Source:myrepublica.com, 30th Dec 2013
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Increase in Nepali Apps developed for Smartphones

KATHMANDU, Dec 29: With the increase in number of smartphone users, the development of new Nepali apps by different companies and individuals, especially for Android-based phones, are on the rise.

To cash in on the increasing number of users of Andrioid phones, BrainDigit IT solution, a Nepali company has come up with different types of Nepali apps.

The company has developed more than dozen of productive mobile apps for Android and Windows Phone like File Locker, a data protection app, Simply Schedule, that allows users to schedule their SMS and Facebook posts, Budget Planner that helps plan and manage money, Trek Guide (TG) for trekkers and Khabar Sanchar for news updates.

The company is soon planning to release two new apps: Predicting Game and Ramailo Mart.

Though the company was established five years back and used to focus mostly on business application development, enterprise content management, and collaborative e-commerce solution, currently it has focused its drives in the field of mobile apps development.

The company assimilates that mobile phones are ubiquitous and the services and wonderful usefulness of the small gadgets have made them an integral part of human race.

“Understanding this scope of mobile phones, we have specially focused on mobile apps and as the users of Andrioid-based smartphones from low end to high end are increasing day by day, we have specially focused on apps for Andriod operating system,” said Gaurab Raj Pant, sales manager of the company.

According to the company, the upcoming app, Predicting Game is an app for online games that allows users to play free online game, creating opportunity to use one´s skill of predicting and wining exciting rewards.

Both these apps will be launched within the second week of January.
“The app is linked with email and Facebook and is free and easy to register. Each game is sponsored by a brand and the winner is privileged by the rewards in the form of cash, voucher and gifts,” said Pant.

Similarly, Ramailo Mart is an online portal which serves as a platform to advertise company and its products and services.

“The app for the portal will help to promote big, medium and small-sized companies and their products nationally as well as internationally. It is a platform for the companies to advertise their products, offerings, events and everything else to a wide range of audience,” added Pant.

The company said that the users of Ramailo Mart app will be able to brand their business and products to large number of audience, advertise their brand in advertisement section, create separate brand pages and even sell their product and services online.

Similarly the newly launched app Khabar Sanchar, which targets readers as well as media houses, allows users to read news from major newspapers and online news portals faster and also according to their interest.

The app has categorized news into different headings, and one can read news in either Nepali or English. However, for the full coverage users are redirected to the website of the source media.

Source:myrepublica, 29th Dec 2013
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