Indian Bpos- Waking Up the Philippines Opportunity
Indian BPOs- Waking up the Philippines Opportunity
Analysis
The Indian labor market has always been key in globalization, and has been attractive due to its low wages, and the scientific and managerial talent found in the country. The main issues faced in this case mostly stem from the loss of the tax abatement in India, in addition to the weakening US dollar. Due to these two issues, doing business in India versus other fruitful options like Philippines becomes very expensive. These are major challenges to combat for any firm looking to outsource in India. In India, the infrastructure along with the setback discussed around transportation, puts a strain on the bottom line. The Tax abatement ending in 2009 was the initial cause of the dilemma. India 's transportation and infrastructure costs are here to stay and other countries like Philippines have much more attractive incentives to bring in higher margins for the multinational corporations. The entire flow and boom of bringing BPOs into India has been affected due to this. The top dollar return on investment for a multinational corporation to bring their business into India is no longer there. However, it is there in the Philippines with the same levels customer satisfaction to be achieved. The solution is that if India wants to keep BPO’s around, they need to revisit re-instating the tax abatement as well as figure out ways the government cover the transportation costs. The Indian government needs to do everything they can to prevent these BPO’s from transplanting or just picking up their entire business and relocating to another country. They should place them in a lower tax bracket for them to stay in India. They should cover the costs of transportation as an additional incentive. At the end of the day, it comes down to profitability and return on investment. It has to be worthwhile for these firms to keep their BPO 's wherever they have them.
1) How has the global economic downturn,
Analysis
The Indian labor market has always been key in globalization, and has been attractive due to its low wages, and the scientific and managerial talent found in the country. The main issues faced in this case mostly stem from the loss of the tax abatement in India, in addition to the weakening US dollar. Due to these two issues, doing business in India versus other fruitful options like Philippines becomes very expensive. These are major challenges to combat for any firm looking to outsource in India. In India, the infrastructure along with the setback discussed around transportation, puts a strain on the bottom line. The Tax abatement ending in 2009 was the initial cause of the dilemma. India 's transportation and infrastructure costs are here to stay and other countries like Philippines have much more attractive incentives to bring in higher margins for the multinational corporations. The entire flow and boom of bringing BPOs into India has been affected due to this. The top dollar return on investment for a multinational corporation to bring their business into India is no longer there. However, it is there in the Philippines with the same levels customer satisfaction to be achieved. The solution is that if India wants to keep BPO’s around, they need to revisit re-instating the tax abatement as well as figure out ways the government cover the transportation costs. The Indian government needs to do everything they can to prevent these BPO’s from transplanting or just picking up their entire business and relocating to another country. They should place them in a lower tax bracket for them to stay in India. They should cover the costs of transportation as an additional incentive. At the end of the day, it comes down to profitability and return on investment. It has to be worthwhile for these firms to keep their BPO 's wherever they have them.
1) How has the global economic downturn,
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