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: A year back, the Indian market did not make any business sense for them. The charge per call or document analysing and processing cost was too low compared with the North American outsourcing business. Now, for various reasons, planners and strategists of large and small business process outsourcing (BPO) companies operating in India - many of them Indian companies—are busy scouting for opportunities in the Indian market.

Market reports suggest that some of the companies like Wipro BPO, Hinduja TMT, IBM Daksh and First Source are aggressively pushing forward their plans to establish their domestic business.

And, why not? In the last two years, the cost of customer service outsourcing for the telecom companies has grown by 10-12%. In fact, from KV Kamath, managing director of ICICI Bank, to Sunil Bharti Mittal, chairman and managing director of Bharti Enterprises, all say that the rising contact centre costs have become an operational issue.

“The rise in outsourcing cost in customer service area worries us. We have to increase the operational efficiency so that it does not affect our profitability,” says Mittal.

For BPO companies, it is an opportunity. “I think today, the cost for the service we charge is less for a company than if it wants to run the entire service on its own,” says Sanjeev Sinha, head of domestic business at Firstsource Solutions.

So Wipro BPO, for which less than 2-3% of the existing business comes from the Indian market, is planning to have a well-spread operation to serve the domestic companies. On an average, the share of domestic revenues to the total is less than 5% for the top ten ITeS-BPO companies, and could easily rise to 10-15% in the next few years. In the quarter ending June in the current fiscal, domestic business contributed around 10.9% as against 2.7% in the June quarter of 2006. With a growth rate of more than 50%, analysts say domestic revenue will easily reach 15% of the overall revenues in the next few years.

It is difficult to quantify the present size of the Indian market though people like Aditya Gupta, chairman of Infovision—one the largest domestic players in the BPO business—says it will be around Rs 6,000 crore.