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Home > India > Business > PTI > Report

Tier II cities to account for 40% BPO jobs

May 05, 2008 19:16 IST

Second grade cities in the country are likely to account for about 40 per cent of the total projected IT-BPO jobs by 2018, if the government in tandem with the industry provides a conducive environment, a study has said.

However, big cities Mumbai, Chennai, Bangalore, Hyderabad, Kolkata, National Capital Region (NCR) and Pune are still the preferred destinations for setting up an IT or a BPO company, a NASSCOM-AT Kearney study on `Location roadmap for IT-BPO growth' said.

These centres are closely followed by Ahmedabad, Kochi, Bhubaneswar, Chandigarh, Coimbatore, Indore, Jaipur, Lucknow, Madurai, Mangalore, Nagpur, Thiruvananthapuram, Vadodara, Tiruchirapalli and Visakhapatnam, it said.

"If the industry follows a balanced growth, these non-leading cities could provide three million direct jobs, 40 per cent of the projected employment by 2018," it added. At present, the leading locations account for over 85 per cent of IT sector employment and over 90 per cent of the BPO employment in the country, it said.

"The development of only a few select set of cities has put severe pressure on the infrastructure, costs and also increased migration of resources," Nasscom President Som Mittal said.

There is a lot of potential in the next set of locations if the government, IT-BPO companies and infrastructure providers pitch in to create a conducive environment, he said.

With the maturing industry, it is imperative to expand the geographical spread of IT-BPO growth to enable more balanced economic development of the country, lower migration across cities and reduce the burden on the stretched infrastructure in the current hubs, he added.

"The Indian IT- BPO sector has been a front-runner of economic development in select cities. We now see the time as being right to spread this development to a new set of locations, provided the requirements of the industry can be met," Nasscom Chairman Ganesh Natarajan said.

The study, released in Mumbai on Monday, provides a gap analysis along with advantages and shortcomings of these 50 locations. The locations were analysed on the basis of talent pool available, infrastructure, social environment, business enablers, government support and cost of operations.

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