Eastern Europe is increasingly a base for Indian IT companies and this is expected to grow as skills become more in demand in Western Europe. The Western European markets are much larger, accounting for about 90% of Europe’s IT demand. But the east has the people and the skills.
Countries like Poland, Hungary, Romania and the Czech Republic already have centres of multinational outsourcing companies such as IBM, HP and Accenture. India's largest IT outsourcing firm TCS also has a centre in Hungary. Other Indian IT firms are exploring the region for talent, as engineering skills are strong in the region. Wipro has delivery centres in Romania and Poland for IT and BPO as well as a presence in Hungary.
The local eastern European IT suppliers compete with the Indian companies for the West's business. Wipro board member Jagdish Sheth says that India could lose its edge in BPO to countries in Eastern Europe, saying in a recent interview. "While our primary focus continues to be Continental Europe, we are seeing opportunities in Hungary and Poland. These are currently small in scale but hold future potential".
Eastern Europe works well as a delivery location to Western European countries because of the closeness of the time-zone. Also, as some of the Eastern European countries are part of the European Union, so data protection and compliance is less of a problem. "Most of the work Infosys BPO does in Eastern Europe is related to SAP consulting and cost arbitrage,” says Abraham Mathews, chief financial officer, Infosys BPO. Infosys has around 2,000 employees in Poland and about 500 in the Czech Republic.