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Chinese Outsourcing Ambitions---Wuxi A Case In Point

Imitation is the greatest form of flattery and India should take pride on the fact that other nations tend to copy Indian models when it comes to boost up BPO/ outsourcing industry in their countries. China is clearly in the race with India and in its struggle to grab the top slot, China is copying her fiercest rival, India. After slashing the prices, now China is all set to replicate Indian BPO hubs in an attempt to seize the meaty global projects. Wuxi, a resort town in Jiangsu province is all set to emerge as a hot BPO destination in few years time, thanks to an ever growing Chinese ambition of outpacing its traditional rival in outsourcing race.

So what led the Chinese planners pick up this quaint town lying along Taihu Lake? A traditional manufacturing town Wuxi was held responsible for causing severe environmental degradation of the region by sparking off serious blue-green algae outbreak in Taihu Lake. Since then the authorities were thinking of channelizing the town’s development in a different path, which will be less harmful for the environment. And BPO service sector came as the natural choice for obvious reasons; the sector is believed to consume lot less energy than its manufacturing counterparts and leaves lesser environmental footprints as a result.

India currently offers over 1 million jobs in BPO/outsourcing service sector.

According to the reports published in China Daily, the city of Wuxi, which is to be modeled on ‘little India’, is expected to attract outsourcing business worth of $ 30 billion to $40 billion. This will help create jobs for one million youth by 2020. But there is seemingly a gap between the goal and the means---the region has a severe shortage of talent pool. As goes the report, the number of students studying IT or software were not more than 2000 about three years ago.

Thus the authorities have a two-pronged plan at this moment. On the one hand they have to accomplish the goal of building total area of six million sq m for software service outsourcing within three years time. On the other hand, they need to create large talent pool to meet the business needs. For this, the local authorities are encouraging corporations to cultivate and import skilled workers. India’s National Institute of Information Technologies (NIIT) was however trusted with the task of setting up of NIIT wing in Wuxi as a training base for the city’s outsourcing businesses.

This NIIT center in China happens to be the world’s second-largest educational institution and this shows that authorities are not prepared to make any compromise when it comes to beat India in the outsourcing game.

And all these already started to pay off; despite recession, Wuxi’s outsourcing sector is reported to maintain robust growth. Between January and July this year, the total volume of outsourcing contract exceeded $1.14 billion in value, which is 110 percent on a year-on-year basis.

Isn’t it the high time that India takes cues from Chinese outsourcing ambitions and work toward retaining her position as world’s largest service-outsourcing base?

Niyamath Parveez

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