Business Process Industry witnesses phenomenal growth
12 Feb '08
3 min read
In a pre budget session organized by Business Process Industry Association of India (BPIAI) an affiliated association of Confederation of Indian Industry, issues like rising cost of real estate, salaries, tax ambiguities, extension of STPI scheme etc that have a detrimental impact on the growth of the Indian BPO industry were discussed in an open platform.
Speaking at the forum held at Gurgaon on 11 February 2008, Mr. Samir Chopra, President, BPIAI said that the Business Process Industry in India has witnessed phenomenal growth in the last few years.
Talking about the challenges he mentioned that the abrupt rise of the rupee against the dollar and pound have left many young BPO firms gasping for breath.
Tax sops from the Software Technology Parks of India (STPI) will also disappear for these companies and this might make investors avoid India and instead invest in other offshore locations like China, Sri Lanka and Philippines.
And this is why most believe, that the government stands to lose more in terms of indirect taxes than it will gain from taking away the tax breaks, he further added.
The Manufacturing and IT sector has enjoyed tax breaks for over 30 years where as the BPO industry being 5 years old has had very little time to benefit from this though the BPOs have the highest density of workforce thereby providing US 30 $ billion export opportunity to India. According to Mr. Chopra steps must be initiated to decouple the IT/ ITES from the BPO sector.
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