Nasscom and IDC have published a report discussing the current size and future potential and direction of India as IT Services and ITES-BPO market.The key output of the study seems to be the unearthing the current scale and the future scope of the domestic IT Services and the domestic ITES-BPO sectors, slated to touch INR 15,604 crores and INR 6,608 crores, respectively by end of 2006, out of which only 45% would go out to IT Services providers whicle the rest would consist of and training costs of inhouse IT staff and the associated overheads.

Another revelation from the study was in the ITES-BPO space, which has been historically associated with exports. The report views that there is huge opportunity waiting to be tapped, as globalisation demands higher efficiencies and competitiveness from Indian businesses. Unlike the IT Services exports market where price arbitrage plays an important role, the domestic market will be driven more by access to specialist skills and helping businesses free up their scarce resources for focusing on core business activities.IT Services and ITES-BPO players urgently need to work together with customers, government and other stakeholders to remove some of the perceived inhibitors and help develop a conducive environment for healthy, long-term growth of the domestic industry.

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Prashanth Rai