The Indian IT industry's ambitions of becoming the primary destination for legal process outsourcing may fall short as myriad issues ranging from dearth of professionals to lack of cost arbitrage would clamp it down.
Legal experts opine it might take another 7-10 years for India to become competent on global front, but that could be too late. This despite the fact that Nasscom has predicted that LPO has a high-growth potential with legal services that can be outsourced from the US alone pegged at $3-4 billion.
It can also provide the country with 79,000 jobs by 2015, states the IT body.
Industry body Assocham estimates that the world LPO industry is around $250 billion, and at present India has a 3-4 per cent share. However, to achieve these goals, the Indian industry has to move over to high-end LPO and offer quality services.
"At present, only certain low-end legal contracts like proof-reading and word-processing works for US clients are being outsourced to India. Quality LPO jobs are not moved over to the country, as India does not have the expertise for the same," claims Majmudar & Co (a leading legal firm) partner Anoop Narayanan.
Currently, menial works like proof-reading of a legal letter or data entry by listening to an audio file (like in medical transcription) are being done from India. While serious works like formatting patent claims, renewal claims (insurance, patent and contracts) and intellectual property issues are being done in US itself, he adds.
J Sagar & Associates partner, Nithin Potdar, concurs, "At present, LPO contracts that require applying of mind is not being outsourced to the country. Certain back-office functions that do not require legal expertise but are related to law firms are being done from India."
These lawyers opine there are only a handful of legal firms in India that have the potential to offer international quality legal services. A rough calculation reveals there only 25 firms - like Majmudar & Co, Amarchand Mangaldas & Co, India Law Services, DSK Legal and Kochchar & Co - that can offer international quality legal services. Secondly, quality services also mean high prices.
These companies, if into LPO, would charge similar to what their US counterparts charge. While in US, the charges would be around $30-40 per hour, it would be more or less in the country, and this would upset offshoring cost-benefits.
At present, there are around 2,000 LPO employees in India and to catch the next wave of outsourcing India has to gear up fast.
There are around 1,000 patent and IP professionals in the country, who has to be trained to tap the emerging opportunity. Moreover, a thorough understanding of the US legal system is also necessary.
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