India’s weak rupee challenge for Philippine BPOs

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bpo-employeeThe drastic fall of the Indian rupee is a problem for India’s fiscal balance, but some are happy about it, among them India’s Business Process Outsourcing (BPO) industry.

The BPO business in India has taken a bit of a knock recently due to the growing competitiveness of the Philippines’ BPO sector and the withdrawal of the 10-year tax holiday that the Indian government previously extended to IT and BPO industry.

However, now the weakening rupee makes India’s BPO companies more export-competitive. after they had lost quite a share of the business to the Philippines.

The Philippine peso too has depreciated against the dollar since May, but far less than the rupee.

The Southeast Asian country has over the past decade emerged as a strong contender to India, particularly in the voice BPO space. India’s BPO revenues now are at about $16 billion annually, while the Philippines’ are about $13 billion.

The rupee has fallen 18 per cent against the dollar in 2013 so far. Since breaking its then record low of 57.32 on June 10, it has consistently fallen further below all reasonable technical targets The rupee was at 65.72 on August 31 and heading towards 70.00.

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Reading Time: 1 minute

The drastic fall of the Indian rupee is a problem for India’s fiscal balance, but some are happy about it, among them India’s Business Process Outsourcing (BPO) industry.

Reading Time: 1 minute

bpo-employeeThe drastic fall of the Indian rupee is a problem for India’s fiscal balance, but some are happy about it, among them India’s Business Process Outsourcing (BPO) industry.

The BPO business in India has taken a bit of a knock recently due to the growing competitiveness of the Philippines’ BPO sector and the withdrawal of the 10-year tax holiday that the Indian government previously extended to IT and BPO industry.

However, now the weakening rupee makes India’s BPO companies more export-competitive. after they had lost quite a share of the business to the Philippines.

The Philippine peso too has depreciated against the dollar since May, but far less than the rupee.

The Southeast Asian country has over the past decade emerged as a strong contender to India, particularly in the voice BPO space. India’s BPO revenues now are at about $16 billion annually, while the Philippines’ are about $13 billion.

The rupee has fallen 18 per cent against the dollar in 2013 so far. Since breaking its then record low of 57.32 on June 10, it has consistently fallen further below all reasonable technical targets The rupee was at 65.72 on August 31 and heading towards 70.00.

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