India’s BPO industry has grown at phenomenal rates

India’s BPO industry has grown at phenomenal rates in the past few years. BPO exports grew from a mere $565 million in 1999-2000 to $3.6 billion in 2003-04. Despite emerging constraints, the industry is expected to grow rapidly, given cost pressures and demographic shortages in developed countries and India’s comparative advantage based on its labour endowment and skill base. BPO exports are projected to rise to $20 billion by 2007 and employment in this sector is projected to rise from its current level of around 300,000 to one million by 2012. Given this, the BPO industry has far-reaching socio-economic and cultural implications, beyond the employment and foreign exchange earning effects.