Wage inflation in India overestimated, says Nasscom

Priya Padmanabhan

BANGALORE: Despite nations like China and Philippines competing with India

for a share of the BPO pie, Nasscom feels that India is still on topsin terms of

cost-competitiveness and labor pool.

“We have found that cost differential of BPO is anywhere between 4-185 per

cent lower in India than popularly cited alternatives like China, Philippines,

Czech Republic and other countries,” said Sunil Mehta, vice-president,

Nasscom.

He was speaking at a session on maintaining cost competitiveness and setting

benchmarks in global outsourcing.

According to Nasscom, entry-level salaries in India have risen by 4-7 per

cent and other countries are grappling with the problem of short supply of

middle level managers.

Raman Roy, regarded as the father of the BPO industry and founder and CEO,

Access Intellect BPO Services, said,” The BPO industry in India was created

based on substitution and cost arbitrage. What is happening now is expansion and

moving to the next level and in delivering unfulfilled needs in certain

segments.”

The use of disruptive technologies to increase productivity and innovation is

what matters, opined Karthik Krishnaswamy, director-IBSG India, Cisco Systems.

Milind Kamat, global director-BPO services, TCS, said that Indian BPO firms

should consider countries in Eastern Europe and Philippines as augmentation

tools for language skills and to meet regulatory mandates.

Mehta also feared that the offshoring debate could return with issue of

privacy cropping up in the US.

“Due to outsourcing of personally sensitive information and critical

operations, privacy issues could come up. There are around 20 Bills pending in

the US senate to regulate offshoring based on privacy issue.”

On benchmarks in the BPO sector, Mehta said that Nasscom is focused on

setting standards on data security and HR.

“We want to raise the bar significantly. There is no uniformity of

standards among companies. So we are looking at regulating ourselves through

initiatives such as Self Regulatory Organizations (SRO), and code of ethics

around data security, HR and data management.”

The panelists also spoke on what has emerged as the constant refrain across

panels this year: Use of technology platforms to deliver services to customers.

“Standardizing platforms will help accelerate innovation curves,” said

Krishnamurthy.

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