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Message: <blockquote data-quote="x-pert" data-source="post: 1256917" data-attributes="member: 837">  NEW DELHI: As Indian ITeS players spread their wings and open global centres, Sri Lanka is fast emerging as a favourite destination for many vendors.   Big BPO players including third party vendors and captives are now discovering the benefits of opening shop in the island country.   While WNS and the captive player HDPI (offshore captive of HSBC) set up their centres in Sri Lanka way back in 2004, others are moving there by and by. So far, HDPI is the largest captive BPO in the country with around 2,500 seats and 2,000 employees. While WNS, has around 350 employees.   As per Sri Lankan Information and Communication Technology Agency statistics, the local BPO industry employs over 4,000 people and it earned around $42 million in 2006.   Not a very late starter in the BPO space, the Sri Lankan BPO sector began operations in 2000 with regular BPO units. And despite the political uncertainty, the industry got a boost in 2004 with nearly five new companies starting operations.   The momentum continued through 2005 with eight additional new firms setting up shop there. Slowly, yet steadily it’s gaining ground.   The country is going all out to woo new players. As GL Peiris, Sri Lankan minister for export, development and international trade recently said. He said, Sri Lanka has invited a handful of Indian IT outsourcing firms to invest there so that they too can gain a competitive edge.   According to Swapnil Sinha, senior research analyst, Everest Research Institute, “Sri Lanka has been in the radar of big BPO players in India for some time now. They have been evaluating it as a potential option for expansion.”  Apart from being a low-cost destination, tax incentives provided by the government have also contributed towards attracting BPO investments in the country. However, political instability, quality of manpower and inadequate infrastructure are some challenges that companies still face there.   Experts feel traditional models of doing business may not always work there and a BOT model could be a better arrangement before entering the country.   As Aradhana Kolhatkar, senior analyst, ValueNotes Research says, “Indian vendors looking to expand delivery centres beyond India are likely to consider Sri Lanka for additional capacity, the benefits being its cultural similarity and physical proximity with India.”  The variety of services being provided from there includes finance and accounting, data processing, voice-based services, research support and publishing services.   Now homegrown ITeS companies too are now attracting business. For example, Amba Research a Sri Lanka firm with over 350 employees offers investment research and support services to clients. Most of the business to the country comes from US, Europe and Australia.   There are still some roadblocks. For example, telecom services are still an obstacle and domestic leased line costs are considerably higher compared to other countries of the region.   Also, as Gaurav Gupta, country head, Everest Group points out, “The country is unlikely to be able to make a strong play unless the political turmoil and security threats are controlled or mitigated.”Source: The Times of India </blockquote>

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