ITES Industry woes in India - Now the low end 'moat' is gone and it is a matter of time before it hits other areas.

Source: CNA

Here is the summary:

India was, at one time, considered the call-centre capital of the world, but it has since lost its status to the Philippines. Some analysts are of the view that India can regain its status, with government support and by giving people the right training.

Now, the big challenge is not really due to the "government support" but more structural issues. Whether it's the non-stop growth in wages in the last decade, or almost nonexistent infrastructure, or the people attitude of get rich quick which, or near zero growth in productivity, or the overall experience or blame the acceleration in globalization bringing more nations to the market, end of the day the market is in dire state. 

Based on Assocham numbers, the new jobs generated dropped by 2% in April-June quarter to 125,000. This is 4.3x the time of Singapore with a net 28,900 addition on Q1. Well, I don't know about numbers from USA or China or Philippines but the number looks dangerously low. It could be only the number from 'tracked' industries or specific cities, which I am not sure but still based on the details in Assocham press release this shows across all metro's, tier-2, and even tier-3 cities.

In my opinion, the key problem is productivity, lack of innovation and more importantly the "service culture & professionalism" which unfortunately not well maintained in Indian industry these days. The "chalta hai" attitude is not only killing the public sector but started to show the dangers in private sector. What we need from industry bodies like FICCI or ASSOCHAM or NASSCOM is to bring back the professionalism and show the value to the Customer. Then all these short falls associated with culture or accent will disappear without any issue.

Philippines, you guys have done a great job. The best thing is we can see it and experience it. Be it the simplification of VISA, or the industry or the regulation. Ofcourse, there are plenty of things to improve but the initiation can be seen and it is good news for all pinoy folks. Cheers..