For many years it was New Delhi, Karnataka and Maharashtra that dominated the Indian IT-BPO landscape. That is until Tamil Nadu, staked its claim to the IT-BPO pie and is fast carving a place for itself as a preferred investment destination for the industry.

By providing sops such as 100 per cent additional FSI to IT parks, a wide range of investment and capital subsidies to IT companies setting up units in the state, facilitating SMEs to attend national/international trade shows by providing 30 per cent of the stall rent payable as subsidy and rolling out e-governance initiatives to deliver special services required by citizens, Tamil Nadu has been catalysing the growth of the IT-BPO industry on its turf.

According to NASSCOM-AT Kearney’s latest study, India: Location Roadmap for IT-BPO Growth, which assesses the IT-BPO business potential of 50 leading Indian cities, the state of Tamil Nadu is well suited for housing the sector. Talent remains a major edge for Tamil Nadu. Overall, around 2,37,000 people graduate from the state, creating a huge pool of talent that can be leveraged by IT and BPO companies.

While Chennai remains the leading IT-BPO location in Tamil Nadu, challenger destinations such as Coimbatore, Madurai and Tiruchirappalli (Trichy) are also being positioned as alternative IT-BPO hubs. The city of Salem, however, will require significant development support before it can become a viable IT-BPO investment destination.

After Chennai, it is Coimbatore that will hold aloft the banner of the IT-BPO industry in Tamil Nadu for the following reasons:

• Coimbatore has adequate talent (28,000 graduates and 10,000 engineers per annum) for the IT-BPO sector, even though the infrastructure and social and living environment needs to improve.
• The location is well suited for being an IT hub and potentially attractive for non-voice BPO operations and domestic voice operations in the native language, Tamil. For the IT sector, it has a good talent pool of engineers and the capability to attract people from other locations.

Besides Coimbatore, the Government of Tamil Nadu is also looking at building Madurai, a major tourist draw in the state. Madurai’s advantages lie in the fact that the availability of talent for the IT and BPO sector is good in the city, even though the quality of manpower, especially for BPOs is an issue. Madurai’s IT landscape is dominated by majors such as Honeywell, HCL, TCS etc.; Many small to mid-sized firms are also thriving in the city. Madurai and its neighbouring regions produce 15,000 graduates, though English proficiency among students is quite poor. The location has numerous engineering colleges and produces around 9,000 graduates every year. IT firms have been recruiting steadily from Madurai and look to increase their presence due to the good quality of talent. Madurai however, still needs to work on its local and international connectivity as well as other basic infrastructure before it can become a viable IT-BPO city.

Trichy, meanwhile, is already a sourcing hub for IT-BPO companies. Further improving its recreational facilities will help the city attract and retain talent. The size of the graduate pool in Trichy is enabling small and mid-sized BPO companies to set up operations in the city. Trichy produces 7,500 graduates, though it has the potential to draw talent from other locations across the country as well..

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