The move by Bharti, one of the most aggressive Indian telecoms players, to outsource its IT needs to the US firm comes amid a raging controversy in the United States about jobs being shifted to India and other developing nations where labour is cheaper.

"Arrangements like this will take the sting out of outsourcing," said Sunil Bharti Mittal, chairman of Bharti Televentures.

Bharti said IBM would now take care of all Bharti's hardware and software requirements, consolidate its data centres, information technology (IT) help desks and disaster recovery capabilities.

"The IT piece is critical in the telecoms jigsaw. Bharti will henceforth stop buying IT telecom, it will stop maintaining IT equipment. We are putting that responsibility on IBM," said Mittal.

"All we know is that we will have IT on tap -- and we are sure that if we have to start servicing 25 million customers from our current levels, IBM will be there to support us on the IT side.

"We're outsourcing the management of our desktop IT environment to improve cost efficiency and service flexibility," he added.

Under the 10-year contract, 200 Bharti computer engineers will be transferred to IBM but some of them will still work on the premises of the Indian group.

"This arrangement is possible because they (IBM) are not only an American company but have a strong presence in India with about 9,000 employees which is not a small number," said Mittal. "I feel safe in their hands."

Under the deal, Bharti Televentures will also be the "preferred supplier" of telecommunication services to IBM India.

"Based on the estimates agreed between Bharti and IBM, the total deal for the first five years is estimated to be 250 to 275 million dollars. For a 10-year period, the total deal is likely to be in the 700 to 750-million-dollar range," said Mittal.

The deal marks a reversal of the trend in which US firms outsource work to India which has the largest pool of English-speaking graduates outside the United States that are willing to work for wages that are far less than those paid in the West.

The issue of outsourcing, creating fears of widespread job losses, has generated huge controversy in the United States in a presidential election year.

Colleen Arnold, general manager of IBM said that this was one of the "largest and most exciting deals" that IBM had pulled off in South Asia.

"It is a significant deal -- a lot of telecom firms are now watching our relationship," said Arnold.

She added that IBM would roll out its most advanced technology to give the Indian firm the "flexibility to introduce the latest in voice, data and content-based services to its cutomers.

"Bharti Televentures and IBM will also pursue joint go-to-market opportunities and avenues for selling value-based services in the areas of communications, IT services and convergence," said Arnold.

Bharti has six million mobile subscribers and 544,900 fixed-line customers.

It is one of the strongest players in the Indian telecoms market, an industry which has emerged as a barometer of the opening up of the country's economy.

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