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'India leads in offshore services'

business Updated: Jul 24, 2008 14:03 IST
Arjun Sen
Arjun Sen
IANS
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India remains the "undisputed leader" in a list of the top 30 countries for offshore services prepared by IT market research major Gartner Inc.

The research firm based in Connecticut, US, applied a list of 10 criteria to find its top 30, but many of the conclusions are already well known - India is the "undisputed leader" in offshore services, with China, Russia and Brazil providing credible alternatives, while Ireland, Israel, Northern Ireland and South Africa are strong in language skills.

According to Gartner, however, there's a stampede of new locations determined to get more offshore business. For the 30 countries that met its criteria, Gartner reports, another 35 were viable contenders, giving companies plenty of choices in 2008.

And of those 35, 13 "came darn close to making the list", according to Helen Huntley, an author of the Gartner report prepared in December 2007.

Those coming "darn close" are Colombia, Guatemala, Panama, Peru, Puerto Rico and Venezuela in the Americas; Indonesia, Mauritius and Thailand in Asia-Pacific; and Belarus, Egypt, Latvia and Morocco in Europe, Middle East and Africa, or the EMEA region.

The aim of the Gartner study was not to rank each country but to help sourcing managers determine which locations are right for their particular needs, Huntley said.

"There are risks and rewards to any part of the world you go to, and everything from service delivery to concerns about security and language to consider," he said.

The seven countries from the Americas are becoming or already are attractive destinations for US companies, but a lack of government support is restricting offshore development, Gartner said.

Only Mexico rated "very good" in this area, followed by Canada and Uruguay. Canada and Mexico rated higher than Brazil in the quality of the labour pool.

In terms of infrastructure, think twice about Argentina, the only country to rate lower than "good". Canada earned excellent marks in most categories, except in the big rate limiter: cost.

The Asia Pacific region boasts the most countries in the top 30 list - 10. India rules, with China at its heels.

Asia has also come a long way in language skills. Only China, Sri Lanka and Vietnam rated less than "good".

As for government support, Gartner said this was strong in China, India and Singapore.

The rest of the countries are a "mixed bag" of pluses and minuses. Australia, New Zealand and Singapore, and an increasingly proactive China, rate high on infrastructure and educational systems.

Vietnam leads the pack on cost, earning an "excellent", while China, India, Pakistan, the Philippines and Sri Lanka rated "very good".

Not surprisingly, cost and risk correlate tightly: the higher the cost, the lower the risks. Vietnam, Pakistan, the Philippines, Sri Lanka and Vietnam scored either "fair" or "poor" in the category of political and economic environment.

The established EMEA countries generally score high on educational systems, infrastructure and language, either because of their high English-speaking population or because they offer other useful language skills.

No country earned higher than a "good" in government support.

Only Russia rated a "very good" in quality and quantity of labour pool. Newcomers like Slovakia and Romania scored well on cost, but costs in the EMEA region in general are in flux, Gartner warned.

The EMEA countries are also parochial; with the exception of Russia, few countries have a network of local service providers outside their own country, it added .