Infosys responds to Ohio Protectionism

The U.S. state of Ohio recently banned IT and back office outsourcing to offshore destinations.

The majority of IT corporations earn most of their revenue from the United States. Considering that Ohio is the seventh largest state in the U.S, a large share of capital comes from the territory. The state's resolution is yet one more obstacle for offshore technology companies. The U.S. recently increased visa fees for offshore consultants.

The National Association of Software and Services Companies contends that Ohio's decision is clearly electoral politics in advance of November elections.

In the mean time, Infosys is increasing hiring in America to cope with the increase in visa charges. Infosys announced plans to hire 1,000 employees in the U.S. in an attempt to create jobs there. To date, the outsourcing company has added 350 employees under the plan.

Despite Concerns, Philippines Economy Growing Fast

The Philippines economy grew by over 7% in back to back quarters for the first time since 2004. Election expenditures, recovering exports, and a better global economy elevated the Philippines economy to 7.9 % growth in the second quarter.

Full year expansion ought to be in the direction of the high end of the 5 to 6% estimate, although it could exceed those levels.

Exports rocketed by 27.4%, the best results in nearly 25 years. Services, led by the business process outsourcing sector, jumped by 6.4% and added 3.2% to GDP growth.

As a result, the central bank of the Philippines (Bangko Sentral ng Pilipinas) stopped short of increasing interest rates. Officials continue to be concerned about the possibility of tepid global growth, despite the fantastic performance of the Pinoy economy.

Disappointing economic growth in the US, Japan, and China are hinting that the worldwide rebound is losing steam. Export growth in the Philippines decreased in Q2 following a boom of about 40% in the prior quarter.

Low inflation has enabled the Philippine central bank to maintain unchanged interest rates for over a year. The Philippine benchmark interest rate the lowest it has been since the central bank began recording data in 1990. The inflation rate stayed put at a 7 month low of 3.9%.

Nasscom Ranks Indian BPO Companies

Indian trade body/chamber of commerce Nasscom, recently announced the findings of its yearly projections on the outlook for fiscal year 2010-2011. According to the study, India's IT-BPO exports are estimated to grow by 13 to 15%, whereas domestic IT-BPO is expected to gain by 15 to 17% during the fiscal year of 2011.

Nasscom expects the IT-BPO industry to experience solid growth this year due to emerging trends. Many of the emerging components of India's BPO industry include Platform BPO, Analytics, and cloud computing services.

The strengthening economy is expected to drive India's domestic spend to over $70 billion US in fiscal year 2011, and increase the size of the workforce by almost a quarter of a million. Nasscom did not speculate as to the impact globally rising protectionist measures could have on the industry.

Nasscom's ranking of IT-BPO providers remained unchanged.

Top IT Service Exporters:

1. Tata Consultancy Services (TCS)
2. Infosys Technologies
3. Wipro
4. HCL Technologies
5. Tech Mahindra
6. MphasiS Ltd
7. Patni Computer Systems
8. Aricent Technologies
9. CSC India and
10 L&T Infotech


However, general BPO rankings were modified:

1. Genpact
2. TCS BPO
3. WNS Global Services
4. Wipro BPO
5. Aegis
6. Firstsource Solutions
7. Infosys BPO
8. Aditya Birla Minacs
9. HCL BPO
10 EXL

Accenture Wins BPO Deal in Norway

BPO provider Accenture recently announced that it has won a three year contract with Norwegian aluminum producer Norsk Hydro ASA.

Accenture will deliver technical support and maintenance services globally to the company's SAP systems. By choosing to outsource tech support, Norsk Hydro expects to maximize the functionality and affordablility of its SAP systems.

As soon as this October, Accenture will assist Norsk’s clientele globally through its call centers in Germany and India.

Accenture has a history of good results with the industrial sector. Fairly recently, Accenture earned a contract with the University of North Texas to implement shared services at its Denton, TX campus.

In August, Accenture won a contract with the Singapore Ministry of Health to implement the National Electronic Health Record system across Singapore. The plan is expected to help its government accomplish an assimilated health care system.

India Upset over Latest U.S Outsourcing Legislation

In the latest struggle over outsourcing, India has fired back at the U.S. Last week, U.S. senators unanimously passed a proposal to nearly double up the charges on work visas for Indian IT and BPO companies sending laborers to the U.S. Indian Trade Minister Anand Sharma has called the move “highly discriminatory” in a letter to his counterpart, U.S. Trade Representative Ron Kirk. This follows a bill introduced by U.S. Senator Charles Schumer last month that would increase fees to companies that use offshore call centers.

Sharma must recognize he’s not going to get compassion from Kirk or others in the Obama Administration. Even if they have been interested to assist fight this motion, they are not aiming to fight the Senate where there is unusual accord about the desire to sock it to Indian outsourcing companies by pricing them more for H-1B or L-1 visas. The major issue is not the new cost of the visa by itself; even with the supplementary $2,000-per-person cost, Indian companies aren’t about to quit transferring staff to the U.S. The bigger anxiety is where this can lead. The problem is that various other Western governments are expected to follow the American lead.

Nasscom, the Indian IT industry’s chief lobbyist, is likely to roll-out publicity campaigns to dispel those untruths and inform Westerners about what Indian IT workers do.