BT Group Plc, Britain's largest fixed-line telecom provider, said on Friday its BT retail unit would set up two call centres in India, joining a long list of firms moving to that country in a bid to cut costs.

Pierre Danon, chief executive of BT Retail told reporters that the telecom giant would not close down any of its United Kingdom centres, and around £105 million ($168 million) of the £108 million that the company was investing in its call centres would be invested in Britain.

"None of BT's permanent employees in the UK will be made redundant as a result of the new centres opening. BT has also made the commitment that no agency people who work for BT Directories in the UK will have their contracts terminated," a BT statement said.

Moving jobs to countries like India, where salaries are lower, is a sore point with trade unions in Britain, with many of them protesting against this growing trend as companies look to cut costs in a highly competitive marketplace.

"In other countries, such as Ireland and Germany, established providers such as BT have lost up to 40 per cent of market share. We will not allow that to happen to us," Danon said, adding that BT stood to save up to 30 per cent in costs by moving work to India.

The two Indian call centres -- one in New Delhi and the second in the country's technology capital Bangalore -- will be owned by local technology firms HCL Technologies and Infosys Technologies and will handle parts of BT's directories and conferencing work.

The two centres, which will start with 500 employees by the end of March rising to around 2,200 people by March 2004, will have BT's systems and will be managed by BT managers.

Danon said the 2,200 jobs will be split more or less equally between the two Indian firms.

Many overseas companies have outsourced back-office functions to Indian firms, or set up their own units to service global clients from India which is a cheaper location with large technically skilled workforce.

Last month, Britain's largest insurance group Aviva Plc said it plans to set up a call and claims processing centre in India, employing about 1,000 people by the end of 2003.