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According to survey of 250 out of the top 500 companies in Europes, by the Geneva-based United Nations Conference on Trade and Development (Unctad), more European companies are outsourcing to India.

India is a favourite destination of outsourcing because of widespread use of English among the middle-level skilled workers. The prime attraction in India is fluency in English language and sophisticated background of basic accounting, electronic and technical skills. The European companies like their US counterparts are using their services, mainly for communication, accounting and software assignments. In India, Bangalore, Mumbai and New Delhi are the favourite destinations with more sophisticated workforce and work base, although Hyderabad and Chennai are coming up fast.

With the current European and American skilled workers' hourly earnings ranging from a sum of $30 to $50 and in Europe the record high cost of social security payments and contributions - outsourcing is considered both worthwhile and profitable for major European and American companies including banks, insurance companies as well as airlines and manufacturers of consumer goods promoting their wares.

According to Unctad report, nearly half of the companies questioned planned to move more services offshore in the next few years, essentially to cut costs to maintain competitiveness. At present, British companies account for 61 per cent of the service jobs moved abroad followed by Germany, Holland, Belgium and Luxembourg, accounting for 14 per cent each. India is rated among the top destination with Asia taking 37 per cent of the jobs moved abroad.

China is at a disadvantage in this sector, but the Chinese make up with their low cost and reliable manufacturing skills. Hence, top destinations are in Asia, mostly India with 37 per cent of the projects.

This is followed by destinations in other parts of Europe - Western Europe 29 per cent and former communist ruled Eastern Europe, which is now becoming part of the European Union - 22 per cent. The Unctad report states that about 80 per cent of companies with their offshore projects have been successful and only three per cent dissatisfied.


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