The ITES sector in India has flourished over the past decade. Due to its low cost but qualified workforce, Indians’ fluency in the English language, governmental support and a stable legislative and economic framework, India has enjoyed its dominant position in the global BPO segment. What more, the 12 hour time zone difference with the primary originator of most BPO jobs, the United States, is an added bonus, as day and night shifts can be carried on as routine. Moreover enhanced competitiveness in the BPO services sector has been increased due to the governmental drive to offer subsidies and tax relief benefits to the ITES industry.
It has been estimated that more than one million people have been employed in the outsourcing companies sector and it has generated revenues beyond expectation. United States holds the most prominent clientele with United Kingdom closely following it. One of the notable features is that majority of the clients are typically engaged in either the IT, financial services or telecom industries.
Challenges faced by the offshore outsourcing industry are significant in the real estate and infrastructure costs. The worst fear being the skyrocketing of construction costs in the main cities. This escalating cost has been resulting in unsustainable going forward. Hence many BPO companies in India have been migrating to suburban cities and even rural areas. Yet another threat is the expanding outsourcing operations and cheaper services by countries like China, Mexico and Vietnam.
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