India is one of the biggest receivers of the outsourced projects in the world. The country has really excelled in the terms of quality of workforce and infrastructure to attract more and more of fortune 500 companies. United States, United Kingdom, Norway and Australia are some of the countries who are constantly outsourcing jobs to India. According to an estimate, around 59 percent of the outsourcing business is India is generated through USA and India seems to be the most favoured destination for US with such a dominant outsourcing market. Most of fortune 500 companies are outsourcing to India to bring down operational costs, in their bid to survive through this era of uncertain economic downturn.
Although multinationals and outsourcing has penetrated in many cities, there are some cities and regions in particular, which attract more outsourcing business. The top outsourcing destinations in India are Bangalore, Delhi-NCR, Chennai, Mumbai, Pune, Hyderabad, Kolkatta, Ahmedabad and Indore. Moreover, with rise in infrastructural facilities, many tier-2 cities are also growing in terms of generating outsourcing business.
Outsourcing Market in India
There is a common belief that Indian outsourcing market is all about call centres. However, this is not at all true. Around 43 percent of the outsourcing market is ruled by IT companies. A large number of jobs outsourced to India are from the information and technology sector. Financial services are on the second spot with a share of 17 percent followed by communication, consumer good & services and manufacturing by 16 percent, 15 percent and 9 percent respectively. The figures are enough to describe the diversity of the outsourcing market in India.
India is obviously not the only player in this outsourcing business so it has to face a cut throat competition from countries like China, Philippines, Malaysia and Bulgaria. However, no country challenges the outsourcing industry of India like China and Philippines do. China has amazing infrastructure in cities like Beijing, Shanghai, Dalian and Shenzhen. Philippines and Malaysia are also excelling in quality of workforce but the cost advantages available in India are its best weapon.
Size of the Industry
According to estimations in the year 2008, the worth of Indian outsourcing market is around US$ 310 billion which was approximately US$ 234 billion in 2005 and US$ 119 billion in 2000. The growth is pretty much evident by these figures. Moreover, outsourcing has provided jobs to thousands of graduates in India. Fortune 500 companies get best of talent at a fraction of a cost which results in better productivity along with savings .
Future of Outsourcing
The annual GDP of India is expected to grow at 8 to 10 percent in the up coming decade. Indian Government is also liberalizing laws for globalization to infuse foreign capital in country. And with raising concerns over the labor force issues and government policies in China, India will further get a boost in demand of its services as per the market analysts. The only cause of concern remain, the anti globalization protest in the western countries which will gain heat because of 2012 is the lection year in United states.