ITES-BPO exports may cross $6 B this fiscal

By agencies   |   Thursday, 16 February 2006, 08:00 Hrs
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MUMBAI: Indian ITES-BPO exports are estimated to grow to $6.3 billion by the end of fiscal 2005-2006.

Exports from the sector had grown 48 percent in 2004-2005, to $4.6 billion, up from $3.1 billion the year before, according to an analysis done by National Association of Software and Services Companies.

Net employment in the sector, by estimates, has grown by 100,000 in 2004-2005 and about 316,000 people were directly employed by the sector.

If the same hiring trend continues, about 409,000 will be employed by the end of current fiscal, Nasscom said.

Employee attrition levels seem to be stabilizing with the talent acquisition, development and retention initiatives being undertaken by the players beginning to deliver results, Nasscom said.

Nasscom also said despite the rising costs, Indian offshore operations provide a cost savings of 40 to 50 percent, even with wage inflation in the range of 10-15 percent annually.

Companies are able to leverage declines in telecom and other overhead costs, productivity gains and economies of scale to sustain the cost arbitrage.

The segment composition of the BPO industry will not change significantly in the current fiscal. Customer interaction services account for 46 percent of revenues, finance and accounting 40 percent, human resource administration 3 percent, and `others' 11 percent.

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