Seven Indian cities have topped a list of 24 vying for the tag of most-preferred offshore location in the world.
Delhi, Bangalore, Hyderabad, Mumbai, Pune, Chennai and Kolkata are the most suitable locations to offshore, states the 2006 neoIT report, Offshore Insights: Global City Competitiveness.
They score over Ho Chi Minh City (Vietnam), Manila, Shanghai and Moscow. Sao Paulo, Warsaw and Krakow bring up the rear.
The report analyses 24 cities around the world in terms of current and future attractiveness for services globalisation.
NeoIT ranked Delhi National Capital Region as the most suitable offshore location, closely followed by Mumbai and Bangalore on the basis of generic factors human capital, costs, infrastructure, business and living environment and risk factors.
On generic factors exclusively, Ho Chi Minh City, Manila, Shanghai and Moscow are the highest ranked cities outside India.
Global leaders like India and the Philippines score only on English language capabilities, the report states, adding that companies looking for other language skills will need to look towards Eastern European nations and China.
In terms of proximity, too, India and the Philippines score poorly. Budapest, Prague and Warsaw are suitable for western Europe, Dalian and Shanghai for Japan, and Mexico for the US.
Mature locations are developing a distinctive industry-specific capability. Bangalore has become a technology hub as well as retail centre, while Mumbai ranks high in financial services.
In developing countries, first-time offshorers prefer mature locations while in developed countries, offshorers are setting up centres in second-rung cities as well.
NeoIT ranks human capital 'as perhaps the most important factor in services globalisation'. Willingness to migrate is another important factor. For instance, it is estimated that over 30 percent of the people working in Delhi's BPO and infotech services companies are from outside Delhi.
In 2004, when neoIT issued the first such report, it had only considered 27 Indian cities. Gurgaon had topped the rankings with Bangalore, Pune, Hyderabad and Chennai following closely. Delhi, a top infotech destination in the early 1990s, had then ranked a poor 20.
Cities that received high rankings included Mumbai and Noida. Challenger cities that were then seen as rapidly emerging viable BPO and infotech offshore destinations included Kolkata, Thiruvananthapuram, Chandigarh and Indore.
In the last two years, multiple sourcing centres of excellence have emerged across the globe, but India continues to be home to several of the most established cities.
"There have been many changes in the last two years, with more cities emerging in the race to service global organisations," said neoIT CEO Atul Vashistha.
As for the future, the report cautions that Indian cities like Bangalore and Delhi NCR are already showing signs of heating up. There is a move towards smaller towns and cities.
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