Uninterrupted internet crucial for digital economy: Ambareen Reza

With Nobel laureate Professor Muhammad Yunus leading an interim government focused on reforms, there is renewed hope for building an inclusive digital economy powered by improved internet connectivity, said Ambareen Reza, co-founder and managing director of foodpanda.

In a recent interview with The Business Standard, Ambareen said these reforms are expected to support startups, SMEs, attract investments, and ultimately restore investor confidence.

"Ensuring uninterrupted internet service is essential for modern businesses. Any disruption could have a ripple effect, hampering business operations, delaying transactions, and ultimately impacting the economy. For small businesses who rely on digital platforms to reach customers, consistent internet access is essential for survival and growth," she said.

Ambareen, also the vice president of e-Commerce Association of Bangladesh (e-CAB), said that the sector had lost around Tk1,700 crore due to the internet shutdown in July.

"This disruption has caused more than 4 lakh digital entrepreneurs– large and small - to suffer and they need financial package from the government to recover from loss," she said.

She, meanwhile, appreciated the recent statement made by Posts, Telecommunication and Information Technology Adviser Nahid Islam that the internet is a fundamental right and that disrupting or shutting down internet services is a violation of human rights.

"This is a very bold statement from the advisor. We fully support this view and believe the internet should be declared a public utility service, making it more affordable and accessible to all," Ambareen said.

She also put forward several recommendations to the interim government to support the e-commerce industry, including subsidising smartphone purchases, driving digital literacy campaigns, offering subsidies for digital payments, waiving VAT on online sales, and providing indiscriminate financial support to small digital businesses and startups.

Ambareen said that providing subsidies for smartphone purchases among people at the bottom of the pyramid is crucial for digital inclusion. Smartphones are a key element in the digitalisation of the economy, and she advocates for a reduction in duty on smartphone imports and local manufacturing.

While there is a call to waive the 5% VAT on e-commerce sales to make e-commerce platforms a more economical and convenient alternative to traditional stores, she underscored that a digital literacy campaign is essential to truly increase the total addressable market.

"The government should give subsidies to customers and merchants to increase the adoption of digital payments. Our payment system heavily relies on cash. But if we can bring more people into the digital payment ecosystem, it will ensure greater transparency as the government can easily track the money flow due to the digital footprint of the transactions," she said.

However, she stressed that zero-interest, zero-collateral loans for small online businesses and restaurants, which are the backbone of the e-commerce ecosystem, are crucial at the moment. Without these, incremental change is unlikely.

On behalf of successful global startups like hers, she expressed interest in helping startups scale through mentorship. However, she believes that to truly strengthen the startup culture, the focus should be on upgrading digital infrastructure, simplifying regulations for stock market listings, and offering tax incentives.

She also stressed that government support should not be influenced by political preferences and called for extending tax exemptions for IT and software sectors until 2035 if we really want to bring about change.

She further stated that the Digital Commerce Authority Act 2023 and Data Protection Act 2023 should be reviewed to ensure they meet all stakeholders' needs, enabling a transparent, efficient, and inclusive digital economy that benefits both businesses and consumers.