‘More offshore centres set up in India in Q2’.

In a report that would elicit a sigh of relief from the Indian IT outsourcing industry under stress due to the global recession, has maintained its leadership as the key outsourcing destination for the global suppliers, in Asia.

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While Asia continued to capture the largest share of offshore centers established in Q2 2009, India maintained its leadership by attracting investments in Tier-1 and Tier-2 cities like Coimbatore, Mumbai and Chennai, the report said.

“There has been significant increase in the market activity compared to Q1 2009 in terms of transaction signings and captive setups. The offshore suppliers are witnessing stability in the financial services sector and expect the demand to pick up later this year, provided economic conditions do not deteriorate any further,” said Nikhil Rajpal, principal, global services, Everest Group.

As per the Everest Research Institute’s research report on outsourcing and offshoring activity, Market Vista: Q2 2009, globally the outsourcing transaction volume increased 10 per cent in the second quarter compared to the first quarter this year.

This was led by contracts signed by financial services and manufacturing firms.

Global suppliers have announced 161 transactions in the Q2 of 2009 compared to 140 in the first quarter of 2009. The share of IT outsourcing transaction announcem

ents increased in the quarter while the share of BPO transaction announcements declined marginally.

During the quarter, 161 new transactions with contract value of $9 billion were signed. Surprisingly, 88 new transactions were signed in the BFSI vertical, an increase of 25 per cent compared with the previous quarter, indicating that the BFSI industry is heading for stability.

Before the slowdown affected the Indian IT outsourcing sector, BFSI was the key focus vertical for most of the Indian IT services providers.

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