Indian BPO services face staff shortage

India's software services and business process outsourcing (BPO) industries could face a shortage of skilled workers in the coming years, according to the National Association of Software and Service Companies (Nasscom) in Delhi.

Although there are about 2.5 million university graduates in India every year, only a very small number of them are employable, said Kiran Karnik, president of Nasscom.

Nasscom is working with universities in India to train people with the skills required by the software services and BPO industries, he added.

Last month an analyst at research firm Gartner warned that India could find its share of the offshored BPO market drop from 80% to about 55% by 2007.

India will lose business to other countries as it does not have a long-term plan for improving infrastructure and increasing the supply of quality workers for the BPO industry, according to Sujoy Chohan, vice-president, and research director for offshore BPO at Gartner.

The country's software and BPO exports are set to grow by 30% in the year to March 2005, despite the outcry against offshore outsourcing in the US, Karnik said.

India's software and services exports business recorded revenue of $12.5bn (£6.9bn) in the year to 31 March, up by 30.5% over revenue of $9.6bn in the previous financial year, according to data from Nasscom.

The revenue figures include billings both by Indian outsourcers as well as wholly owned software development and BPO operations in India of multinational companies.

John Ribeiro writes for IDG News Service