Jehan Perinpanayagam, Chairperson of Sri Lanka’s tech industry body SLASSCOM, shares insights into Sri Lanka’s burgeoning innovation landscape; both its promising trajectory and soft underbelly that calls for scaling and leveraging. Drawing parallels with regional success stories, particularly India’s remarkable strides in digital innovation over the past decade through Startup India and Madras IIT, Perinpanayagam emphasized the need for Sri Lanka to embody similar focus and execution in its journey towards becoming a startup ecosystem in bloom.
Sri Lanka boasts a pool of exceptional innovators, drawing the attention of renowned global companies such as IFC, HCL, and HSBC, all of whom have established centres in the country to tap into local talent. The spirit of innovation permeating Sri Lanka’s landscape has earned it recognition, with the nation ranking second in South Asia on the innovation index by WIPO (World Intellectual Property Organization).
This reputation for innovation resonates strongly with customers and member centres worldwide, reinforcing the value placed on Sri Lanka’s talent pool. The success stories of Sri Lankan startups further underscore the nation’s potential. Companies like Virtusa, now employing 39,000 people globally, exemplify the transformative journey of local ventures. BoardPAC, utilized by leading corporations globally, serves as another testament to Sri Lanka’s capability.
However, leveraging the Sri Lankan startup ecosystem is paramount. Learning from successful models like Startup India and Madras IIT, Sri Lanka must focus on securing funding, providing robust mentorship, and facilitating global exposure for startups. Emphasizing global thinking is crucial; startups should not limit themselves to the local market but should explore broader horizons, tapping into the vast potential of neighbouring markets like India.
Given your important position at the nexus of digitalization, governance and investment, how well has Sri Lanka harnessed the digitalization wave of the last few years, compared to its regional neighbours?
India’s remarkable strides in digital infrastructure serve as a compelling example of Sri Lanka’s transformation journey. Recently, key architects of India’s digital public infrastructure shared their success story, highlighting a significant shift towards digital banking and transactions. Within a decade, India transitioned from being one of the least banked nations with only 20% banking access to achieving an impressive 80% accessibility.
The impact of India’s digital infrastructure is evident in everyday transactions, with street vendors embracing cashless transactions through systems like U-pay. Moreover, a plethora of apps built around this infrastructure cater to various needs, including microloans facilitated by digital identification. In contrast, Sri Lanka’s efforts towards digital ID have faced setbacks over nearly two decades, underscoring the urgency to prioritize and expedite such initiatives.
Recognizing the need for collaboration, there is a high-level government-led initiative with support from India to advance Sri Lanka’s digital agenda. COVID-19 highlighted the potential for digitization, as seen in streamlined banking and customs transactions. However, recent regressions towards paper-based processes underscore the need for steadfast commitment and execution.
Despite trailing behind India, Sri Lanka stands at a pivotal juncture to embrace digitalization, leveraging lessons learned and external assistance. As the President emphasizes, the current economic crisis presents an opportunity to emerge as a digital powerhouse. With geographical proximity facilitating implementation tracking, Sri Lanka is poised to swiftly transition towards becoming a digital nation.
With the industry data showing a 6-point exit count between 2018 and 2022, and early-stage funding growth ranking 1 out of a scale of 1 to 10 in the same period, where does Sri Lanka’s digital landscape stand in terms of resiliency?
In terms of resilience, Sri Lanka has demonstrated commendable results. The presence of nearly ten submarine cables proved beneficial during recent disruptions in the Red Sea region. This extensive network contributes to the nation’s robust record uptime, with multiple cables passing through or near its shores. Notably, proactive measures such as the conversion of base stations to solar power during fuel shortages highlight a commitment to sustainability and risk reduction.
With 95% of the island covered by connectivity and over 60% internet penetration, along with 35 million mobile phone subscriptions, Sri Lanka stands well-positioned to embrace digitalization. Despite challenges, including recent crises, connectivity remained steadfast, ensuring uninterrupted business operations. Customers attest to Sri Lanka’s ability to maintain service delivery and connectivity, underscoring the nation’s resilience in adverse circumstances.
What homegrown opportunities should Sri Lanka zero in on, in terms of thinking out of the box and investing in solutions already present in the local digitalization ecosystem?
Sri Lanka boasts a wealth of talent and a demonstrated capacity for scalability, particularly in the realm of information technology (IT). We’re witnessing the integration of IT education into school curricula and a marked increase in the output of IT graduates from universities nationwide. This growing awareness of the industry extends beyond the Western Province, permeating regions throughout Sri Lanka.
However, despite these strides, our industry’s visibility on the global stage remains relatively limited. While countries like India and the Philippines are renowned as major providers of IT and business process management (BPM) services, Sri Lanka’s recognition in this arena is less pronounced. Nonetheless, there’s a burgeoning interest in Sri Lanka among industry players, with notable Indian companies, such as HCL, establishing secondary centres here and expressing satisfaction with the quality of work produced.
Recognizing the importance of diversifying risk, especially in the wake of the COVID-19 pandemic, we’re actively pursuing collaborations with Indian and Philippine companies to encourage further investment in Sri Lanka. Leveraging our geographical proximity to India presents a significant opportunity for growth.
Moreover, we’re keen in identifying and capitalizing on niche areas where we can excel. Artificial intelligence (AI) emerges as a prime contender, with Sri Lanka poised to establish itself as a centre of excellence in this rapidly evolving field. With the formation of a dedicated AI task force and initiatives like AI code clubs in schools, we’re laying the groundwork to become leaders in AI innovation.
In tandem with our pursuit of niche areas, we’re committed to positioning Sri Lanka as a responsible destination for IT/BPM services. This entails a focus on sustainability, inclusivity, and employee well-being. By championing responsible business practices and fostering an environment of equal opportunity, we aim to carve out a unique identity for Sri Lanka’s IT/BPM industry on the global stage.
Can you tell me about any lesser-known initiatives in the industry which are addressing untimely challenges Sri Lanka’s innovation landscape is facing?
We have several impactful initiatives aimed at fostering innovation. Firstly, our active capacity forum collaborates with universities, educational institutions, both state and private, and vocational training centres to ensure that curriculum development remains relevant and up-to-date. We provide input on enhancing graduate output to meet industry demands.
Another significant initiative is the upcoming SLASSCOM Ingenuity Awards, scheduled in a few months. This event serves as a platform to showcase innovative talents across all levels, starting from schools throughout the island. It’s a proud tradition, with the upcoming edition being the sixth, reflecting our commitment to nurturing innovation.
Additionally, we host various hackathons, including ones tailored for women and focusing on specific challenges like the green IT challenge, particularly pertinent in areas such as food security. Inspired by successful models in India, we aim to identify pressing problems and engage companies to develop innovative solutions.
We believe that Sri Lanka is at a pivotal moment, presenting a generational opportunity to accelerate digitization. It’s crucial not to overlook this chance. We must aggressively pursue this agenda and not be deterred by minor obstacles. The digitization of customs and other government branches can significantly enhance efficiency, reduce costs, and combat corruption. There’s a substantial window of opportunity before us, one that we must seize without hesitation.