Communications giant British Telecom has said that it is considering moving its directory inquiry service to India.

The UK directory inquiry services market is worth some £280 million and if BT follows other British companies by switching its work to India, it could achieve savings of 40 per cent through lower wages and other costs.

Last week Aviva, Britain's largest insurance company, decided to move its call centre to India.

Aviva said it would create at least 1,000 jobs in India, which BT would match, if it decides to go ahead with its relocation plans.

A spokesman for BT said, "It is true that we are considering whether to establish contact centres in India, but we have not made a final decision.

"We would stress that, whatever decision is reached, we would not destroy BT jobs in the UK only to recreate them in India. In line with our usual practise, anyone who wants to stay with BT will be able to do so and be retrained and reskilled, if necessary.

"We will always review our operations to help us provide the best standard of service at the most competitive cost."

Despite these reassurances, the UK's Communications Union said it is considering a campaign of industrial action to protest against the move. The union said it would lead to 700 job cuts starting April.

A spokeswoman for the union said BT had a social and economic responsibility to preserve jobs in the UK.

She added, "BT is being very coy about its plans and seems to be waiting for any backlash.

"But they believe they need to be able to compete on cost and will not be able to do that unless they transfer work offshore."

The Chairman of the UK Telecommunications Users Association, Bill Mieran, said: "In truth, I suspect most people may not even realise the calls are being routed via India.

"The Indian operators are likely to be highly trained to graduate level. They will be better qualified than people doing the job in this country.

"This is part of a growing trend by banks and others to move call centres to India where wage levels are a fraction of the figure here. If people don't like the idea of calls going to India, they can always opt for one of the alternative services."