Building on work from as far back as 2006 to identify economic opportunities for Jaffna

Posted on October 19, 2017  /  0 Comments

In 2016 LIRNEasia went to Jaffna for fun. Finally there was a hotel big enough to house our large group so we decided on Jaffna as the location of our annual trip. Many interactions followed, for example on our work on online freelancing.

This longer piece was first published in Tamil in Thinakkural. It is interesting that the Tamil paper carried the data tables, but the Financial Times chose to delete them (correction: deleted only in the online version).

As I was looking over the piece, I could see various activities that had contributed to the thinking. One that was particularly important was the work I did while in government to attract BPO industries to Sri Lanka and the work that Sriganesh Lokanathan led in 2006.

Potential exists for the development of Jaffna as a second tier IT city. Youth in Jaffna are tech savvy and highly enthusiastic about ICTs. Volunteer organisations are actively creating awareness and interest on IT entrepreneurship among Northern youth. The Budget Speech of 2017 has announced a 200% capital allowance for businesses starting up in the North. If the Diaspora’s capacity is also effectively utilised at this stage, more start-ups such as the flourishing Extreme SEO5 are possible within the region.

Telecom connectivity is precondition for IT and ITES. The SLT fibre is running to Jaffna,6 though most likely overpriced and discriminatory. If the regulatory problems can be solved, telecom connectivity should not be a deal breaker except for BPOs where tasks are time critical. For them, the existence of a single supplier and a single “pipe” will be unacceptable. Unless that problem is addressed all that is likely to emerge in Jaffna are non-time-critical IT and ITES firms. The other precondition for successful IT and ITES is ability for foreign principals to get to the location from the airport quickly. Jaffna at present cannot satisfy this condition. For this, Palaly has to be developed as an international airport, with scheduled domestic connections from Katunayake as an interim solution.

Reliable continuous power could be a problem in Jaffna, but it is solvable with 100% redundant generator backup. Transport for the employees will have to be addressed as well. Until Jaffna infrastructure comes up to required standards, there is a good case for a business park where companies can start operations with minimum hassle.

Financial Times.

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