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China may match India in BPO by 2007

August 24, 2003 14:36 IST

China is fast rising as a service outsourcing hub and could catch up with India by 2007, according to Business Week.

"Gartner Inc predicts that by 2007 China will pull in $27 billion for IT services including call centres and back-office work, matching India," it said in its recent issue.

ConnectITChina, a Shanghai-based consultancy, has estimated that China's software outsourcing revenue would more than double to $5 billion by 2005.

China is joining English-speaking countries such as India and the Philippines as a key destination for outsourced service jobs, Business Week said.

"So far China is focussed on providing back-office support for financial service, telecom software and retail companies in neighbouring Asian countries where operators can easily talk in Japanese and Korean languages. But it is making inroads as an outsource base for English speaking nations," it said.

China's low cost talent is another edge, it said, adding that although India is a powerhouse in high-end IT services, latecomers these days must pay higher wages for experienced engineers.

In this context, the magazine gave the example of BearingPoint, formerly KPMG Consulting, which opened a software development centre in Shanghai and quoted its Greater China president Bryan Huang saying, "BearingPoint pays $500 a month for engineers in Shanghai. In India, the pay would be $700 and in US it would be $4000."

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