Sri Lanka to launch Rs. 3 bn fund to develop IT industry

The Sri Lankan government will launch IT Initiative, an exclusive fund to develop the IT industry with the assistance of the island’s universities.

The Minister of Finance Mangala Samaraweera in his budget for next year announced that the government will launch its “Angel Fund for the IT industry” and invest Rs. 3 billion in the fund within the next five years. The initiative will be operated through the Export Development Board.

In his budget speech Minister Samaraweera said the IT and the IT related sectors have the potential to reach USD 5 billion in export earnings in the next 5 years.

“As such, to support this industry, especially the SME IT companies, we will launch, the ‘IT Initiative’, which is in effect the Government’s angel fund for the IT industry,”

The initiative, in the next five years will support the local startups and also attract foreign startups, and Small and Medium sized IT Companies. It will support creating the enabling environment by supporting establishment of Incubators, supporting the acquisition and augmentation of skills and knowhow in collaboration with the local universities etc.

The IT Initiative will at the outset finance 50% of the rent expenditure for 24 months on the Hatch Incubator and similar support to any such private ventures in the future, as well.

The Universities of Colombo and Moratuwa and, Sri Lanka Institute of Information Technology (SLIIT) will conduct training courses on Artificial Intelligence, Robotics, Data Science, Machine Learning, Python Development etc. in collaboration with the industry.

Employment for those who successfully follow such courses will be guaranteed by the private sector. The cost of these courses will be shared between the industry and the proposed IT Initiative.

The SME Guarantee Fund will be extended to the IT Initiative and the exporters who require support, as well.

Prime Minister Ranil Wickremesinghe last week said the government will give tax concessions for the IT industry to expand and provide funding to train the youth employ them in the industry. He said the government is starting a new Bank for Development Finance so that the IT industry will have funds for development.