Rural BPO: Sustainability And A Better Life

Posted on May 24, 2011 in Specials

By Sanika Natu:

The concept of Business Process Outsourcing, or popularly referred to as the BPOs crept into India in the past decade. Catering to the needs of MNCs (Multinational Corporations) and their operations and mainly providing technical assistance to Western customers – BPOs bloomed across the country in the blink of an eye. After targeting urban youth, mainly devoid of employment BPOs penetrated in the rural areas as well. And soon BPOs turned out to be the bread and butter of many a people in the lesser known districts of India.

Indian economy has always been agrarian in nature. With 70 per cent of India living in villages, one can’t deny rural masses’ high dependence on agriculture and related activities. In spite of this scenario, BPOs entered the rural scene with poise and high expectations. One could count rising costs in major cities as a plausible reason for this.

Skyrocketing infrastructure and real estate costs and rise in salaries have forced many small and mid level BPO players to substantially move out of urban India into the lesser travelled regions as it has eventually lead to a rise in BPO costs. Moreover, a few entrepreneurs aimed expansion of BPOs into rural India with the motive of bringing such areas in the main-stream economy of the country. This provided employment opportunity to the local youth with minimum education. And as many locals considered computers and the language English as a symbol of high status, BPOs gained popularity and wide scale acceptance. Eventually, this has begun the process of gradual transformation of rural India.

Have a look at the below projections of a few companies (listed in first-left corner) that have established rural BPOs and how they will fare in the coming years. (source)

Rural Outsourcing In India

Projections ( By 2013 – 2015)

Customers Current Centres Employees Centres Employees
ADF* 1 2 550 NA NA
B2R 3 2 100 100 6,000
DesiCrew 12 5 225 50 5,000
Drishtee 6 -7 2 30 NA NA
eGramIT 15 4 700 30 3,000
Harva 5 3 30 70-100 10,000
NextWealth NA 2 200 40 1,000
RuralShores 12 6 500 500 100,000
Source For Change 4 1 70 200 10,000
SourcePilani 7 1 60 5 500
Tata Group** 4 NA 2000 —– 10,00
Total 26 4,465 925 145,5000


Various BPO units and entrepreneurs, in order to escape the inconvenience of costs have reached to the rural parts and have captured them well. Youth and women seem to be in spotlight as far as recruitment in such BPOs is concerned. While some of these centres are run from non-air conditioned buildings with plastic chairs and women rushing in and out for carrying out their domestic errands, others are placed in well established infrastructure and modern offices where team leaders hold post-graduate degrees. But, what are analogous between these two types are their location and the man-power that is utilised. Employees are often youth or women with Class XII as their educational qualification followed by training in English-speaking skills.

As a result of this reason or that, BPOs have cropped across many small villages like Ethakota, Munnar, Tikli Akilampur, Bagepalli, Bagar, Mithapur, Jamuhar to name a few from hundreds. There are a few BPO units opened only for women which have lead to greater empowerment of the ‘weaker sex’. In a country where women are expected to remain confined to chores and kids, this scope of employment has given them a voice. Today, many of them add to their family income, pay off debts or buy cows and buffaloes. One such Indian BPO company is HarVa which is the first of its kind to employ only women from rural set ups.

Though BPOs in rural areas often come across primary obstacles like poor infrastructural facilities, lack of broadband connectivity or electrification, analysts believe they are highly sustainable for they are cost efficient. They have proved to be lucrative to both the employers and the locals as they have empowered the latter to earn and live with dignity. Moreover, they seem to have tapered the gap between the Tier I and Tier II or III cities and have infused the conceptions of globalisation into India’s rural roots. While some doubt, the sustainability of such outsourcing units in the rural areas many believe they are here to stay. As employment in rural areas is seasonal with respect to monsoon farming, BPOs could prove to be an asset to those with seasonal unemployment. They could provide employability to many through adequate training. When the BPOs entered the cities cynics raised questions on their sustainability like they are raised today with regard to the rural spectrum. And as they were answered back then, government support and improved inputs could backlash another bunch of such questions. With the yearning to narrow the bridge between two kinds of India-rural and urban and with the hope to merge them together, one could say, BPOs are here to reside in the bucolic India.