Hidden costs haunt Indian Cos

<div class="section1"><div class="Normal"><script language="javascript">doweshowbellyad=0; </script><br />NEW DELHI: After battling legislations, Indian call centres now face attack on a critical front: the cost advantage. A UK-based recruitment agency warns of hidden costs embedded in the outsourcing deals. <br /></div> <div align="left" style="position:relative; left: -2"><table cellspacing="0" cellpadding="2" align="left" border="1" width="21.5%"> <colgroup> <col width="100.0%" /> </colgroup> <tr valign="top"> <td width="100.0%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" f3f3f3=""> <div class="Normal"><img src="/photo/361850.cms" alt="/photo/361850.cms" border="0" /></div> </td> </tr> <tr valign="top"> <td width="100.0%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" f3f3f3=""> <div class="Normal"><span style="" font-size:="">Call centres under attack</span></div> </td> </tr> </table></div> <div class="Normal">Costs of redundancies and retraining in the UK, plus legal and advisory fees undo all the cost-cutting achieved by outsourcing, says the Association of Technology Staffing Companies (ATSCo).<br /><br />"Many companies fail to achieve any cost reductions from their <a href="http://www.thetimesofindia.online/articleshow/358708.cms" target="_blank">outsourcing</a> projects and some even experience an increase in costs," Ann Swain, chief executive of ATSCo was quoted by vnunet.com.<br /></div> <div align="left" style="position:relative; left: -6"><table cellspacing="0" cellpadding="2" align="left" border="1" width="34.7%"> <colgroup> <col width="100.0%" /> </colgroup> <tr valign="top"> <td width="100.0%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:=""> <div class="Normal"><span style="" color:="" ffffff="" font-size:="" font-weight:="" bold="">RELATED STORIES</span></div> </td> </tr> <tr valign="top"> <td width="100.0%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" fbfbfb=""> <div class="Normal"><a href="http://www.thetimesofindia.online/articleshow/358708.cms" target="_blank">Outsourcing: A win-win deal for consumers, firms</a><span style="" font-size:="" font-weight:="" bold=""></span><br /><span style="" font-size:=""> </span><a href="http://www.thetimesofindia.online/articleshow/354607.cms" target="_blank">UK Budget to hasten BPO to India</a><span style="" font-size:="" font-weight:="" bold=""></span><br /><span style="" font-size:=""> </span><a href="http://www.thetimesofindia.online/articleshow/354430.cms" target="_blank">''Not outsourcing to India? Think again''</a></div> </td> </tr> </table></div> <div class="Normal">Indian IT workers work on a meagre £20 an hour compared to the British £100 an hour, but the <a href="http://www.thetimesofindia.online/articleshow/354430.cms" target="_blank">savings on outsourcing</a> don''t add to the profit line thanks to huge upfront investment costs and years of fine tuning, the association warned. <br /><br />India remains the prime destination of outsourcing for the American and <a href="http://www.thetimesofindia.online/articleshow/354607.cms" target="_blank">British companies</a> as the country turns out 75,000 English-speaking IT professionals every year and has a low-wage structure.<br /></div> <div align="left" style="position:relative; left: -3"><table cellspacing="0" cellpadding="2" align="left" border="1" width="71.9%"> <colgroup> <col width="49.1%" /> <col width="50.4%" /> </colgroup> <tr valign="top"> <td width="100.0%" colspan="2" rowspan="1" style="" valign:="" top="" background-color:=""> <div class="Normal"><span style="" font-size:="" font-weight:="" bold="">PEOPLE WHO READ THIS STORY ALSO READ...</span></div> </td> </tr> <tr valign="top"> <td width="49.1%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" e3f1ff=""> <div class="Normal"><img src="/photo/361851.cms" alt="/photo/361851.cms" border="0" /><span style="" font-size:=""> </span><a href="http://timesofindia.com/articleshow/361385.cms" target="_blank">100 pc lovers lie to each other: Survey</a></div> </td> <td width="50.4%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" e3f1ff=""> <div class="Normal"><#img src="/photo/361851.cms" alt="/photo/361851.cms" border="0" /><span style="" font-size:=""> </span><a href="http://timesofindia.com/articleshow/361345.cms" target="_blank">India clinch historic win Down Under</a></div> </td> </tr> <tr valign="top"> <td width="49.1%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" e3f1ff=""> <div class="Normal"><#img src="/photo/361851.cms" alt="/photo/361851.cms" border="0" /><span style="" font-size:=""> </span><a href="http://timesofindia.com/articleshow/361229.cms" target="_blank">Iraqis want Saddam dead by summer</a></div> </td> <td width="50.4%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" e3f1ff=""> <div class="Normal"><#img src="/photo/361851.cms" alt="/photo/361851.cms" border="0" /><span style="" font-size:=""> </span><a href="http://timesofindia.com/articleshow/361470.cms" target="_blank">IIT-ians murder: NRIs want PM to act</a></div> </td> </tr> </table></div> <div class="Normal"><br /><br /></div> </div><div class="section2"><div class="Normal"><script language="javascript">doweshowbellyad=0; </script><br />But Indian BPO providers still have a few cards up their sleeves. A recent Forbes study said their outsourcing functions would change over time and India will be able to net more complex jobs as countries like Vietnam edge them out in the low-wage war.<br /></div> <div align="left" style="position:relative; left: -6"><table cellspacing="0" cellpadding="2" align="left" border="1" width="34.7%"> <colgroup> <col width="100.0%" /> </colgroup> <tr valign="top"> <td width="100.0%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:=""> <div class="Normal"><span style="" color:="" ffffff="" font-size:="" font-weight:="" bold="">RELATED STORIES</span></div> </td> </tr> <tr valign="top"> <td width="100.0%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" fbfbfb=""> <div class="Normal"><a href="http://www.thetimesofindia.online/articleshow/358708.cms" target="_blank">Outsourcing: A win-win deal for consumers, firms</a><span style="" font-size:="" font-weight:="" bold=""></span><br /><span style="" font-size:=""> </span><a href="http://www.thetimesofindia.online/articleshow/354607.cms" target="_blank">UK Budget to hasten BPO to India</a><span style="" font-size:="" font-weight:="" bold=""></span><br /><span style="" font-size:=""> </span><a href="http://www.thetimesofindia.online/articleshow/354430.cms" target="_blank">''Not outsourcing to India? Think again''</a></div> </td> </tr> </table></div> <div class="Normal">India can look forward to more outsourcing contracts from UK banks and insurers in the near future, if Chancellor Gordon Brown''s pre-budget report is anything to go by.<br /><br />In his proposals last Thursday, Brown hinted at a possible clampdown on value added tax (VAT) loopholes which allowed outsourcing firms to avoid the levy on contracts, which will eventually save the exchequer millions of pounds.<br /><br />India could be the largest beneficiary of the new proposal if it comes into effect, since more British companies may transfer their call centre and back-office functions to India to avoid the VAT.<br /></div> <div align="left" style="position:relative; left: -3"><table cellspacing="0" cellpadding="2" align="left" border="1" width="71.9%"> <colgroup> <col width="49.1%" /> <col width="50.4%" /> </colgroup> <tr valign="top"> <td width="100.0%" colspan="2" rowspan="1" style="" valign:="" top="" background-color:=""> <div class="Normal"><span style="" font-size:="" font-weight:="" bold="">PEOPLE WHO READ THIS STORY ALSO READ...</span></div> </td> </tr> <tr valign="top"> <td width="49.1%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" e3f1ff=""> <div class="Normal"><#img src="/photo/361851.cms" alt="/photo/361851.cms" border="0" /><span style="" font-size:=""> </span><a href="http://timesofindia.com/articleshow/361385.cms" target="_blank">100 pc lovers lie to each other: Survey</a></div> </td> <td width="50.4%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" e3f1ff=""> <div class="Normal"><#img src="/photo/361851.cms" alt="/photo/361851.cms" border="0" /><span style="" font-size:=""> </span><a href="http://timesofindia.com/articleshow/361345.cms" target="_blank">India clinch historic win Down Under</a></div> </td> </tr> <tr valign="top"> <td width="49.1%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" e3f1ff=""> <div class="Normal"><#img src="/photo/361851.cms" alt="/photo/361851.cms" border="0" /><span style="" font-size:=""> </span><a href="http://timesofindia.com/articleshow/361229.cms" target="_blank">Iraqis want Saddam dead by summer</a></div> </td> <td width="50.4%" colspan="1" rowspan="1" style="" valign:="" top="" background-color:="" e3f1ff=""> <div class="Normal"><#img src="/photo/361851.cms" alt="/photo/361851.cms" border="0" /><span style="" font-size:=""> </span><a href="http://timesofindia.com/articleshow/361470.cms" target="_blank">IIT-ians murder: NRIs want PM to act</a></div> </td> </tr> </table></div> <div class="Normal"></div> </div>