Grapevine

CNBC's Inside India newsletter: The 'sticky' outsourcing firms on the rise

India has long been the destination for companies in developed markets to outsource labor intensive tasks.

Over the years, the services sector of the Indian economy has grown to account for 45% of total exports, up from 30% a decade ago. Business process outsourcing, or BPO, which includes customer support, drafting contracts or producing mass marketing campaigns, makes up more than three quarters of services exported by value, according to consultancy Capital Economics.

Relatively low labor costs and high IT literacy has contributed to services exports growing by nearly 20% annually over the past two years, significantly faster than the 5% year-on-year increase in goods.

The Indian government, meanwhile, has been eager to support the manufacturing sector in creating mass employment, a key economic and political challenge that the services sector alone hasn't been able to address.