Indian call center industry no longer the biggest

More people work in call centers in the Philippines than in India. The growth rate of India’s call center industry has slowed as it faces demand and supply side pressures. Many clients are moving work back onshore, operating costs are increasing and the jobs are loosing their luster.

An Indian call center

Image via Wikipedia

India now faces stiff competition from the Philippines, according to recent research from IBM. The study for the Contact Center Association of the Philippines estimates that 350,000 Filipinos work in call centres, compared with 330,000 Indians.

via BBC News – India’s call centre growth stalls.

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Signs of slowdown in Indian IT sector?

Indian IT companies are delaying  joining dates of new hires. This may reflect an expected  slowdown in demand for IT services in mature markets. It may also have something to do with the double digit salary growth witnessed in this sector, which is reflected in lesser attrition – attrition is down from 25% to 15%.

This year, TCS has campus hired 40,000 students, Infosys 30,000, Cognizant 28,000, Wipro 20,000 and HCL 8,000.

via Slowdown: IT cos delay freshers’ joining letters – The Times of India.

Cognizant's Delivery Center in Chennai, India.

Image via Wikipedia

However, this is not dampening the current hiring spree, which reflects an expected uptick in demand for IT services within the next 1.5 – 2 years.

Predicting when China’s economy will become numero uno

The Economist has shared a great interactive chart using which one can predict when the Chinese economy will overtake the US. As per the IMF, this will occur in 2016 on purchasing power parity basis. Using the relative growth rates of the two economies, the difference in inflation (the GDP deflator) and the appreciation of the Yuan against the dollar, the Economist’s tool gives a target of 2018.

Read more at Becoming number one | The Economist.

 

The interactive chart is at

http://media.economist.com/sites/default/files/media/2010InfoG/Interactive/China_US_GDP_Dec18/main.swf

IT hiring in India reflects strong future growth

IT companies are hiring heavily at engineering campuses across India, with many students receiving multiple offers.

Take the case of Amrita University which has campuses in Bangalore, Coimbatore and Kochi. India’s second largest IT exporter Infosys and Nasdaq-listed Cognizant shared the first slot. While Cognizant picked up 1,263 students, Infosys went for 1,255. Around 970 students had common offers and finally, 83% of them opted for Cognizant while the remaining chose to go with Infosys.

However, this does not tell the full story.  Students who receive an offer today will likely join jobs after another year. After joining the job, most fresh engineers receive 3-6 months of training before they join projects. Thus the hiring of today reflects the projected demand for IT services, 1.5 -2 years into the future.

During 2011, over 4.3 lakh fresh engineering graduates are expected to pass out with 2.5 lakh will be graduates with an IT degree, says industry lobby Nasscom. However, not all of them are directly employable and hence the huge scramble for talent at top colleges. Companies know this and are making a beeline for the top-level talent.

via Recession? IT cos hire in large numbers – The Times of India.

India’s industrial outpost: Tata for now | The Economist

TACO Faurecia Design Center

Image via Wikipedia

A mutually beneficial situation – the largest employer in the UK, Tata brings animal spirits and resources to the seemingly moribund British manufacturing industry. Tata gains not only 60% of revenues, but also from improved management processes, advanced technology and access to the international stage.

India’s industrial outpost: Tata for now | The Economist.

Tata UK is now the country’s biggest manufacturer, with almost 40,000 workers—just ahead of British Aerospace. Add in Tata’s service industries, such as consultancy, and the payroll tops 45,000 (see chart). Its presence in Britain is part of a growing trend. Britain is second only to America as a destination for investment by emerging-market firms, many of them from India.

But just how sweet is Tata for Britain? Any fears that Tata would strip out technology and ship it home have proved baseless. The headquarters of Tata’s beverage business is Uxbridge, a London suburb, not India. Resources have been poured into other businesses.

What will drive the tripling of Internet users in India by 2014?

From 100 million to 300 million in 3 years is the readily accessible part of the market. There are a potential 500 million more users. Key to this growth will be cheap 2G internet access ($1 per GB) over $50 smartphones – not 3G/4G on $250 phones. Data-sipping apps and contextualized websites will be important. Facebook Zero is leading the way.

Internet users to triple in India by 2014: Google – TNW India.

Google thinks that the proliferation of high-speed third- and fourth-generation telecom networks in the country, coupled with the spread of low-cost smartphones, will further the spread of Internet use in India.

Long way to go in global ICT (telephony & broadband) stakes for India

As per the International Telecommunications Union‘s latest report, India has some way to go in the global ICT (telephony and broadband) stakes. The report measures ICT Development Index as a composite of ICT Access, ICT Use and ICT Skills. ICT Price Basket is measured as a composite measure of fixed, mobile telephony & broadband prices as a percentage of average income. India ranks 116 in ICT Development and 87 in ICT Price Basket.

Though real prices for ICT access in India are among the lowest in the world, they form a substantive percentage of an average Indian’s income. An urban / rural breakup of these factors in the Indian context would provide interesting insights into the digital divide and illuminate potential pathways towards inclusive growth.

Another link to the report is here.