The burgeoning Indian ITES-BPO sector is projected to grow by 35-40 percent during the current fiscal (2006-07) to post about 8.5 billion U.S. dollars in exports by March 2007, according to Indo-Asian News Service Wednesday.
"The Indian ITES-BPO sector is expected to maintain the current export momentum to grow by 35-40 percent in this fiscal to achieve 8-8.5 billion U.S. dollars as against 6.3 billion U.S. dollars in 2005-06," Nasscom president Kiran Karnik said in Bangalore Wednesday.
Inaugurating the India ITES-BPO Strategic Summit organized by Nasscom, the industry body, Karnik said the growth was being driven by a steady increase in the scale and depth of existing service lines.
On the hiring front, net employment in the segment has grown by 100,000 in FY 2006 to take the total number of people to 415,000, with turnover/attrition levels stabilizing due to talent acquisition and retention initiatives, Karnik told about 500 delegates participating in the two-day event.
The IT industry provides direct employment to about 1.3 million people and indirectly employs about three million people in the country.
According to a Nasscom analysis of the ITES-BPO sector, outsourcing to India provides significant benefits over arbitrage in labor costs through business process enhancements and improvements.
In spite of the rising element of cost, Indian offshore operations provide cost savings of 40-50 percent annually. Similarly, despite 10-15 percent wage inflation annually, companies are able to leverage declines in telecom and other overhead costs to sustain the cost arbitrage, Karnik said.