India lost 10 percent of BPO business in 5 years
Source: india tribune View: 335 Date: 2013-03-13

India has lost about 10 percent share of the global BPO market in the last five years to destinations like China, the Philippines and Brazil, raising concerns for the $20-billion Indian BPO industry.

The pre-budget Economic Survey 2012-13, which was tabled in Parliament on February 27, said India faces stiff competition from several emerging countries in the BPO sector.

It called for information campaigns by the industry to dispel the myths and fears about outsourcing in the developed economies.

Countries like Malaysia, China and the Philippines in Asia; Egypt and Morocco in North Africa; Brazil, Mexico, Chile and Columbia in Latin America; and Poland and Ireland in Europe are emerging as attractive destinations for voice contracts, posing a significant threat to Indian firms, it said.

"According to Nasscom, in the last five years, India has lost about 10 percent market share to the rest of the world in the world BPO space, most of which is in the voice contract segment," it said.

According to industry body Nasscom, in FY13, IT services would account for $50 billion, while Business Process Management (BPM or BPO) and Engineering services would contribute $20 billion and $10 billion, respectively.

In the overall IT and IT-enabled services space, new competitors like China, Israel and the Philippines have emerged in recent years.

Between 2005 and 2011, the annual average growth of IT-ITeS services was 69 percent in the Philippines, 28 percent in Sri Lanka, 59 percent in Ukraine, 27 percent in the Russian Federation, 37 percent in Argentina and 35 percent in Costa Rica.

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