India still most favoured IT, BPO hub: Survey

India remains the most favoured outsourcing destination, according to CyberMedia's Global Services survey on Emerging Outsourcing Destinations in 2007.

Even as fears that the rupee appreciation and rising wage costs would blunt its edge, India still boasts of the largest number of cities (6) which figure among the top 50 emerging cities, followed by China (5), Brazil (3), the Philippines (3) and USA (3), among others.

The study identified Asia and East Europe as the favoured destinations for information technology (IT) and business process outsourcing (BPO), as 19 Asian and 12 East and Central European nations featured in the list of the top 50 emerging outsourcing cities globally. Bangalore, New Delhi, National Capital Region (NCR), Manila, Mumbai and Dublin dominated as the top five cities that have established themselves as prime outsourcing cities by servicing the global corporate world for over a decade, the study said.

The study, conducted in association with investment advisory firm Tholons, shows that outsourcers consider process maturity, availability of relevant skills and costs in the individual city as the top reasons before deciding on the location for IT and BPO services outsourcing. Avinash Vashistha, Chairman and CEO, Tholons points out, ""With the demand-supply gap widening, newer tier II cities will play a critical role in re-engineered globalisation models."

The top three emerging outsourcing cities world-wide from India are Chennai, Hyderabad and Pune. While Kolkata ranked fifth, followed by Kolkata in the ninth spot. The list aslo features three cities from China and two from Vietnam. With most of the large IT companies setting up base there, Chennai was identified as an established location for automotive engineering services, product development, FAO and health-care BPO. While Hyderabad gained its place due to the preference of the large corporates and the support of the government that is planning to create 250,000 new IT jobs in the next two years.

Pune also earned its place as an outsourcing destination due to lower operating costs and low attrition rates compared to the other metros. And Kolkata�s IT industry is growing at 70% per annum, along with sound educational infrastructure, lower costs and even lower attrition rates helped it to gain the fifth spot. Owing its ninth place to its planned facilities like telecom, power and road infrastructure and new Chandigarh Technology Park Chandigarh is home to major IT companies like, like Dell, Quark, Net Solutions, Netsoft Global Solutions.

In terms of function, Bangalore topped the list for Application Development and Maintenance and Testing. NCR was took the top spot as the established destination for business analytics, contact centres. While Mumbai dominated the finance and accounting space.

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