Jaipur, the pink city of India has a number of architectural wonders that attract tourists from all over the country and abroad. It emerged as an outsourcing destination in 2006, when the tier-1 cities in India had reached saturation. However, the city seems to have lost its identity amongst the other tier-2 cities like Ahmedabad, Baroda, Bhubaneswar and Thiruvananthapuram, which have outpaced Jaipur.

The city was ranked 31^st in the Top 50 Emerging Outsourcing Destinations, a Global Services-Tholons Study in 2008 and only inched up to the 29th rank in 2009. Low cost, reasonable education, good infrastructure and proximity to Delhi were the major attractions in 2006 for vendors like Genpact and Infosys who had set up their centers in the city.

Saugata Sengupta, Analyst, Tholons, an investment advisory firm also explains that Jaipur has marginally gone down in terms of its attractiveness in the last couple of years, post its highlighting as an emerging destination. The answer to ‘why’ that happened is not simple since multiple factors have worked as an inhibitor for the location.

Proximity to Delhi: Advantage or Disadvantage?

Jaipur is a three hour drive from NCR ( national capital region encompassing Delhi, Noida, and Gurgaon), a high-power IT-BPO cluster in itself. Thus, a vendor could have one delivery head for both the centers (Jaipur and NCR) and cut down on the cost. On the other side, the talent pool is always ready to move out of Jaipur and settle in the metropolitan capital. It’s very difficult to retain the young talent pool for a long time. “Though the city has an early mover advantage, I believe that when a city grows, hurdles and humps are expected. On the positive front, Jaipur has low human capital cost and we always have people moving from the interiors of Rajasthan to the city. Thus, there is a certain segment of people who enjoy the advantage of living in a small city and working for global companies like ours,” says Raghavendra K, Vice President and Head, Human Resources, Infosys BPO.

Comparison between Jaipur and Delhi Outsourcing Destination

Source: Tholons

Government Efforts and Educational Institutions

Mahindra World City, Jaipur’s SEZ includes exclusive zones for IT/ITeS companies, light engineering companies including auto and auto component manufacturers, handicraft companies, gems & jewelers companies and apparel companies which offer world class infrastructure for IT/BPO organizations.

Infosys (3,000+ headcount), Teleperformance (4,500), Genpact (4000), Deutsche Bank, Wipro, Nagarro, Truworth, Tech Mahindra and QH Talbros are some of the prominent firms established in the city. In the last one year, there have been no new delivery centers in the city and the government has not taken any initiative to boost the outsourcing Industry. “The government support has been mediocre in the city. However, we continue to grow with the existing clients and they are happy with our performance,” says Diwakar Singhal, Senior Vice President and Site Leader, Genpact, Jaipur.

Jaipur has the advantage of having a high graduate output of over 60,000 annually. However, the quality of technical/managerial talent pool shows up under-par on the employability scale. English-speaking is a challenge as many of the schools in Rajasthan have been Hindi-speaking for over 10 years and changed to English medium only two or three years back, explains Diwakar from Genpact. Thus, the city is better for its ITO services rather than BPO call centers. The vendors also have to invest a huge amount of time, energy and money training the youth in English speaking.

Raghavendra K from Infosys also feels that it is a collective responsibility of the government and the educational institutions to focus on employability and communication at the same time.

The Government initiatives and education system in Jaipur has a long way to go if it has to make it big as a tier-2 outsourcing destination, else it is in for a precipitous fall.