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Mumbai, Feb 15

INDIAN ITES-BPO exports are estimated to grow to $6.3 billion by the end of fiscal 2005-2006.

Exports from the sector had grown 48 per cent in 2004-2005, to $4.6 billion, up from $3.1 billion the year before, according to an analysis done by Nasscom. ( National Association of Software and Services Companies).

Net employment in the sector is estimated to have grown by approximately 1 lakh in 2004-2005, the total direct employment having risen to 3.16 lakh.

Based on the hiring trends over the year, this segment is likely end the current fiscal with total employment at 4.09 lakh.

Employee attrition levels seem to be stabilising with the talent acquisition, development and retention initiatives being undertaken by the players beginning to deliver results, said Nasscom.

In spite of the rising elements of cost, Indian offshore operations provide a cost savings of 40 to 50 per cent, even with wage inflation in the range of 10-15 per cent annually.

Companies are able to leverage declines in telecom and other overhead costs, productivity gains and economies of scale to sustain the cost arbitrage.

The segment composition of the BPO industry will not change significantly in the current fiscal.

Customer interaction services account for 46 per cent of revenues, finance and accounting 40 per cent, human resource administration 3 per cent, and `others' 11 per cent.

(This article was published in the Business Line print edition dated February 16, 2006)
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