India - A big human capital mine as core of outsourcing

Oct 03: India with its immense pool of young talent is now one of the most preferential outsourcing points in the business world. A study conducted by the Global Services magazine of CyberMedia features five of Indian cities among the top 50 most emerging outsourcing destination in 2007.

In spite of the value rise of Rupee against dollar, India still remains one of the focus points with low cost of living and a large pool of able workers. The study shows that five of Indian cities including Chennai (ranked 1 st), Hyderabad (2 nd), Pune (3 rd), Kolkata (5 th) and Chandigarh (9 th) are among the top ten emerging global outsourcing destinations.

Among the top 50 outsourcing cities world-wide, India adds six including Coimbatore. Asia and East Europe are now attracting outsourcing jobs due to the growing users of information and communication technology in terms of availability of relevant skills and also the cost effectiveness of the region.

Chennai ranked top which is almost base for all top IT companies including Infosys, TCS, IBM, Satyam and Sun Microsystems. Also taking advantage as the largest automotive industry along with operational efficiency in healthcare BPOs, it is now one of the stand points of hundreds of small or big multinational companies.

However, as rupees growing stronger against US dollar and at the same time the rising infrastructure cost in these leading IT cities is now making companies to move towards smaller cities. The government is also working in collaboration with private sectors to bring an over all development in those small cities.

In fact it is the result of a friendly government policy that encourage the IT sector including a welcoming tax policy with duty free import of capital goods and above all its education structure which makes the country the second largest English speaking population in the world.

Cities like Delhi/NCR, Bangalore, Hyderabad, Mumbai/Pune and Chennai are in the forefront of the outsourcing boom and other smaller cities are also joining with high quality manpower. There is huge amount of skilled and untapped man power which attracts companies to exploit and also it will create more employment opportunities in the coming days.

However, there is also a fear of shift of this outsourcing boom from India to other parts in view of high-quality/low-cost location. Though India is still one of the low cost locations but as far as quality of infrastructure and service along with rising labour cost is concerned the growth rate might have seen some kind of erosion.

As for the current statistics that India mostly depends more on United Sates for its outsourcing jobs but now it needs to shift the focus to other non-English speaking markets. These again demand more sophisticated back office support in addition to usual call centre and also with advanced infrastructure. Again the dollar term as rupee scores high against dollar the rising wages of employees may create disparity in the labour demand supply equation. But it is interesting to see how the whole scenario moves in the coming days.