Chennai and Hyderabad to take lead: Gartner

Hyderabad and Chennai will soon replace Banga-lore and Mumbai as favored
Indian destinations for IT outsourcing by 2010, accord-ing to the Gartner report
on IT Outsourcing to India - Analysis of Cities.

The report also stated that certain drivers enable these cities as favorable
destinations for outsourcing. These include improv-ing infra-structure, overall
skills availability, good quality edu-cational institutions and active political
support.

The improving infrastru-cture in Hyderabad has ena-bled the city to top the
ratings in the infrastructure category.

However, according to Gart-ner, other factors that are inhi-biting this
growing favorability and need to be addressed are increased attrition,
inadequate infrastructure, escalating costs and lack of good quality real
estate. Pune which ranked lowest in infrastructure sup-port will need
significant inve-stment to be at par with cities like Mumbai and Bangalore or
even cities like Chennai and Hyderabad in the future.

Commenting on the report, Partha Iyengar, VP , Gartner said, "Bangalore
and Mumbai will soon cease to be the defa-ult cen-ters for offshor-ing. Ready
availability of skilled labor force with lower attrition rates in cities like
Chennai, Hydera-bad & Pune will lead to compa-nies setting up centers there
instead. In the long run other factors including global foot-print of service
provider, ser-vice line capabilities and expa-triate index will also play a
greater role for global MNCs or IT service providers setting up or expanding in
these cities."