Many medium enterprises in IT/ITeS sector from Hyderabad and Bangalore are shifting or expanding their bases in the Philippines owing to concerns pertaining to infrastructure, cost of doing business and availability of skilled labour, an ASSOCHAM survey said.

ASSOCHAM referred to current developments taking place in the southern part of the country, and said that it clearly indicates that India's prominence as an Information Technology/Information Technology Enabled Services (IT/ITeS) hub is fast fading away.

"The driving forces are multitude, ranging from ease of doing business, availability of abundant English speaking workforce at lower wages, better infrastructure to government incentives", said D S Rawat, Associated Chambers of Commerce and Industry of India.

"It is imperative for Governments at the Centre and States to quickly initiate remedial measures on war-footing to stem the loss as the capital flight will not only severely affect the growth and employment but threaten India's leadership in the knowledge industry," he said.

According to the just concluded ASSOCHAM Eco Pulse (AEP) Study titled "Sustaining India's IT/ITeS Leadership", the prevailing macroeconomic and sectoral conditions have been resulting in a shifting of ITeS/BPO industry away from India to the Philippines, especially from Hyderabad and Bangalore.

Such a trend is yet not being noticed in the National Capital Region and Pune.