Nasscom-Kearney study on IT-BPO industry identifies small cities with big potential

With the IT-BPO industry maturing, it has become imperative to expand the geographical spread of IT-BPO growth to enable more balanced economic development of the country, lower migration across cities and reduce the burden on the stretched infrastructure in the current hubs, he added.

While big cities will continue to be the preferred destinations for setting up IT-BPO companies, the Tier II cities will have the potential to account for at least 40 percent of the total projected IT-BPO jobs by 2018 provided there is a balanced growth, the report said.

Presently, the top seven cities account for over 85 percent of IT sector employment and over 90 percent of the BPO employment in the country, it said.

The report is expected to benefit regional governments, as they will be able to plan and develop the regions and attract investment in the future.

All the locations were analyzed on the following parameters: talent pool available, infrastructure, social environment, business enablers, government support and cost of operations.

India's $64 billion IT-BPO industry employing 2 million people, accounts for 5.4 percent of India's gross domestic product (GDP). The industry, which grew in the mid-1990s and helped the nation's economy surge to an annual growth rate of nine percent, is expected to increase its workforce to 8 million by 2018.