Calcutta, Nov. 22: HSBC is planning to set up a second business process outsourcing (BPO) centre in the city. The bank’s general manager and country head (India) Naina Lal Kidwai said, “We met the chief minister today and gave him our early commitment for another BPO unit.”

HSBC already has a BPO centre in the city, set up by its wholly owned subsidiary, HSBC Electronic Data Centre. The centre has around 2,000 employees. “The second BPO unit will employ another 2,000,” Kidwai said.

“We are also setting up our second software development centre in Hyderabad,” she added. The bank has one development centre in Pune for its global operations.

In fact, HSBC had announced last year it would double the size of its offshore back-office and contract centre operations to 25,000 employees by 2008 to save $1 billion in costs.

“India definitely gives us a labour arbitrage when compared with developed countries. However, with increasing cost of employment across all sectors, we will have to look into the labour arbitrage within the country,” Kidwai explained why the bank chose the city to set up another BPO centre.

But the company is apprehensive of frequent strikes and bandhs in the state. “You can’t have strikes and bandhs often when you are catering to global clients 24X7,” Kidwai said.

Kidwai also aims at net profit of $300 million during this fiscal from the bank’s operations in the country. “If we can achieve that we will be among the top 10 countries contributing the majority to HSBC’s global earnings,” Kidwai said.

India currently ranks after China and Brazil in total business turnover and profit.

To achieve the profit goal, HSBC will focus more on SME and retail businesses. “Big corporate banking constitutes about three-fourth of our total business. We want to ramp up our SME and retail businesses so that these two sectors together account for 50 per cent of the business in the next two to three years,” Kidwai said.