'India continues to be the forerunner in IT-BPO industry'

NEW DELHI, INDIA: According to a recent report by Cushman & Wakefield, globally India continues to be the forerunner in the IT-BPO industry. However, a number of other South and South-east Asian countries are increasingly gaining share in the global IT-BPO Industry.

India continues to outperform its counterparts - Philippines, China, Malaysia and other South Asian countries in the IT-BPO industry due to abundant availability of English speaking and qualified talent pool, good network infrastructure, higher cost arbitrage, rapidly growing domestic market, positive business environment that fosters Foreign Direct Investment (FDI) in the IT-BPO sector among others.

India's advantage also lies in its strong domestic demand, the geographical diversity and the growth potential in Tier II and Tier III cities, added the report.

While India is at the forefront in the IT industry, Philippines is emerging as India's competitor in voice-based operations. The major growth of voice-based operations in the country is primarily because of the educated and English-speaking talent pool, it added.

China's capabilities in low cost manufacturing and research are helping the growth of its IT industry apart from its increasing foothold in the BPO and data center segments. But the country is finding it difficult to make it big into the global BPO services due to language constraints.

Its strengths are in R&D, high-end analytics and development of advanced IT and electronic technologies which differ from India's core prowess, thus making possible to both the countries to exploit and develop their key expertise areas.

Sanjay Dutt, executive managing director - South Asia, Cushman & Wakefield said: "The strength of the Indian IT industry lies in its stronghold over the outsourcing industry worldwide and the rapidly growing domestic market."

"The Indian domestic market registered a growth of 14.1 per cent year on year while the exports grew by 10.2 per cent year on year, added Dutt.

Apart from the key cities, in India Tier 2 and Tier 3 cities in India such as Bhubaneswar, Chandigarh, Jaipur, Kochi are amongst others offer significant growth potential and provides a sizeable domestic market and are the new emerging centers for IT businesses, said Dutt.

On other Asian countries, the report further added that Malaysia, Indonesia and Vietnam have been successful in attracting IT/ITeS activities to their nations.

 

"The IT industry in these countries is still in a nascent stage in these countries, largely due to the lack of adequate and skilled English-speaking talent pool."

Also, infrastructure in the form of telecommunication network, internet bandwidth, electricity supply, etc., is largely limited to the capital cities, further restricting the growth of the industry, report said,

Impact of the IT-BPO sector on Commercial Office supply

The IT-BPO industry continues to command the majority share of the total Grade A office space leasing in India. Meanwhile, in the Philippines and China the share for the same has been rising significantly.

Cushman & Wakefield's research shows that most international IT-BPO companies are looking at opportunities to locate their operations within multiple Asian countries.

Though India is poised to remain the key location for most global software development and BPO companies, the Philippines is expected to attract some of the BPO activities such as global call centers/voice-based outsourcing activities, added the report.